Start Your Year Off Right: Improve Value, Profits, and Scalability in Your Company

As a CEO, you already know that to lead a successful company in today’s marketplace takes resilience.  No industry or organization is immune to the turbulent, unpredictable, and rapidly changing factors that demand we shift how we approach strategy, innovation, and competition.  That strategy shift is not about the quick profits, but creating scalable business models that can withstand disrupted fundamentals (supply chain, workforce, etc.), and structural inflation.

In fact,  Forbes shared some startling research: 2/3 of Inc. Magazine’s annual list of the top 500 fastest-growing companies had either “shrunk, stagnated, or failed.” ¹

A scalable company is one where the future revenue costs less to achieve than the current. The expense of funding growth is more than offset by the added profits you can make. While every CEO is looking to expand their operations, a scalable company integrates the groundwork to intentionally improve every part of the organization. 

So, let’s dive in on how to do exactly that.

Keep Your Machine Well-Oiled
Keep the cogs in your business machine greased with frequent attention, efficiency, and clarity. Putting the best systems in place for each sector of your business allows operations to keep running smoothly, cash flow to be steady, and productivity to increase.  Consider the right systems and technology to keep the engine moving. Look at CRM, marketing automation, sales management, inventory, manufacturing, accounting, HR, shipping and other technology systems.

Whether partnering with a strategic business advisor, like a B2B CFO® to help your decision making and financial direction or investing in a sales management system that is able to track which potential customers become real patrons of the business— your growth can be managed, scaled and maneuvered as need be. Take a moment to see what areas in the business are operating in silos or even in a haze. By creating efficiency and resolving issues, you will build value, retain customers, keep stockholders, and be well positioned to ultimately raise your profits.

Evaluate Price, Product, Promotion
A crucial step in building value, profits and scalability is understanding the relationship between your price, your product, and your sales efforts. A business owner shouldn’t throw caution to the wind when building marketing and brand awareness; instead, they should ensure that the right strategy is applied to the right product with the right price. Research what your competition is doing, what is the unmet need in your market space— what avenues of marketing haven’t you tried that your customers might respond to, and what new product or service will give you an edge.  What processes have you implemented, or products/services are you offering that aren’t yielding revenue?

Strengthen Customer Relationship
A customer relationship doesn’t stop once the transaction is complete or when your business grows to the goal of your liking.  Continue to make customer service your No. 1 priority. Invest in customer relationship management systems, polling measures or email surveys, tracking their data like gender, age, demographic and their purchasing behavior such as how often they buy your product or service.  These numbers and data are the keys to your success; they reveal customer satisfaction, customer loyalty, what you can expect in sales and projected growth as well as potential for upselling.

One tool successful companies use to track promoters and detractors, is using the Net Promoter Score. To calculate NPS, start with asking customers the ultimate question, “How likely are you to recommend us to a friend or colleague?” and score the answers on a zero-to-ten scale. Your Net Promoter Score is simply the percentage of customers who are promoters (those who scored 9 or 10) minus the percentage who are detractors (those who scored 0 to 6).  This tool can help improve processes, people, products, and pricing for the long term. ²

Honor Your Employees
A hallmark of a good company is one whose employees are proud to work in and boasts a great retention rate. The businesses that are rapidly growing, focusing only on profits and forgetting about the value tend to burn out their staff, provide low quality products their own teams don’t believe in and ultimately experience high turn-over. Each employee is an investment in time and money; an employee resigning means taking the time and money to train and integrate another. It’s in your company’s best interest to have culture programs, diversity & inclusion initiatives, paid time off, flexible time off and bonuses to help keep employees not only happy but also inspired by the vision and goal of your company. Take the time to create a company culture survey.  Find out if employees are truly happy, do they align with the company’s culture, are they being paid competitively, and do they have a healthy relationship with management. With a high retention rate, you get to keep your staff talent inside your business, focusing on the work that they are proud to be a part of at hand.

Build and Foster a Solid Sales Process
Scaling your company assumes you will sell more products and services and even expand in your current geographical location. Do you have the sales structure in place to generate more sales?  Look at sales from end to end to make sure you have a sufficient lead flow to generate the desired number of leads. Assess your marketing systems to track and manage leads. If there’s a bottleneck in the process your sales team will not be given fresh new leads—and you risk losing a potential sale.

Do you have enough sales representatives to follow up and close leads? Once requests for quotes, a new sale, or any new business comes in, be sure you have a robust system to manage the sales orders and billing systems/ receivables to follow up to ensure invoices are sent and collected timely.

Where B2B CFO® Comes In
B2B CFO® works with all CEOs and business owners to increase scalability, profitability, cash flow, company value and financial planning. If you are looking for a partner to help you formalize business goals and ultimately achieve them for sustainable growth, please schedule a complimentary discussion with a local B2B CFO® Partner today.  Visit www.b2bcfo.com

Sources:

1. Eric George. Forbes. Why Rapid Growth Kills Small Businesses, 2020.
2. Bain and Company- Net Promoter System℠