Jan. 6/13, 2020: Volume 35, Issue 14
By Jerry Levinson
Some people have never set goals because they don’t believe it will influence their bottom line. They aren’t sure how to use the information.
For example, if you were planning a vacation, what’s the first thing you need to know? How are you getting there—by plane or car? Running your business is the same thing. You have to know where you are going in order to create your map to get there.
Let’s break it down this way: Let’s say your 2019 sales were $1,240,000. The year 2020 is going to be amazing, so let’s go with a 20% increase in business. So the goal for 2020 is $1,500,000. Furthermore, let’s say your average ticket price is $2,500. You would need 600 flooring projects to reach your goal in 2020. Assuming your closing rate is 50%; for every two customers you see you close one. If you need 600 flooring projects that means you need to see 1,200 customers. To meet this goal, you will need 100 leads a month at a 50% closing rate at a $2,500 average ticket price to reach $1,500,000.
However, there are a couple ways to reach your goals even faster—the best way is to raise your prices. Did you know you could raise your prices by 10%? (You would have to lose 40% of your business just to break even.) You can increase your average ticket price by offering more expensive products. You can make a habit of measuring other rooms and offering more flooring. You can learn selling strategies to help you command more money, like bundling and offering a “friction-free” buying experience.
I mostly focus on sales goals because it is the easiest goal to track and measure throughout the years. However, there are some other goals that may be important for you to achieve:
•Your closing rate
•Your average ticket price
•Your profit margin
•Number of stores
•Number of salespeople or employees
•Personal goals (i.e., weight loss, health, savings, relationships, etc.)
Note: Any goal you set should be meaningful and measurable, and you should reward yourself when you achieve them.
Moreover, you should share your business goals with your employees so they have a clear vision of what you want to accomplish. They will know their role and work harder to help you reach those goals and objectives. Without a clear vision or plan, your employees are just working for a paycheck. If your employees are just working for a paycheck, they won’t be as loyal to your company.
It’s also a good idea to share your goals with your vendor partners. In fact, every year when I go to shows I ask my suppliers, “How are you going to help me reach my goals?” I take the opportunity to ask for things I specifically need to help me reach my goals.
I’m one of only a few flooring dealers who does this, so I get the attention I need. If you don’t come prepared with your vision and goals, you will follow the agenda of the supplier. Put yourself in control and bring your blueprint with you to show how you are going to increase sales by 20% in 2020.
Jerry Levinson is the owner of Carpets of Arizona and founder of Profit Now, a consultant business for flooring dealers. He has also authored two books on sales and marketing. In addition, Levinson manages the Flooring Dealer Group on Facebook, which boasts more than 3,000 members.