How to drive sales is one of the common concerns of many businesses nowadays, and this is maybe because of high competency on the services or products you provide.
So if you really want to increase your sales radically shift your attention pertaining to sales from attracting new clients to convincing your proven and tested clients to purchase all over again. The most and best sales outlook is a view which is already converted – in short, one of your present clients.
Top line income growth is considered the most essential part of a flourishing retail business. A business can have best margins, extraordinary stock turnover as well as outstanding great margins return of investment, however if sales are not adequate to cover usual operating costs, you have got a big problem.
Evaluate Financials First
When a business facing a dilemma regarding on how to drive sales, reviewing the financial statements is one of the major thing you should take place. It is very essential to have a base line on the company. The loss statement and profit aids ascertain the price of products sold is within company norms, and which operating fees are reasonable and normal for the location and the type of store.
The first part of the P/L offers information pertaining to sales volume as well as the productivity of those sales. Check out for a percentage adjustment from previous year up to the present if available. The GM number illustrates how efficient the procedure is at trading goods at complete cost. A GM or gross margin percent which is lower would be a sign of excessive markdowns or a sufficient initial gain
When assessing the operation cost, first you need to pay attention on payroll cost and occupancy, as those is liable to consume the biggest fraction of the fund. Since the conversation is on how to drive sales, a review on the promotion and sales expenses must be in order.
When it comes to your balance sheet, you need to consider the three essential things:
•How much capital does business have?
•How much capital is owed and due?
•Are there loan responsibilities which need to be paid monthly and how much?
Calculate or Compute Breakeven
For instance there is no main concerns are seen on the process of your financial reviews, knowing the breakeven point of the business is the next good thing to consider. Meaning, the number of sales should be acquired for the viability of the operation. You can obtain this number through the long complex way and the fast simple way.
To obtain a fast and reliable breakeven amount you need to take your annual operating cost and divide in the probable percentage of gross margin:
•Formula: total charges / anticipated gross margin percent
•For instance: $440,000/47%=$936,170
When the monetary statements are in a good shape, you need to determine why your sales are not growing. In this case, there are a lot aspects that you have to consider such as the location, the economy, dollars every square foot, promotional and advertising activity such as social media promotion, ability and attitude of sales staffs, management and ownership involvement assortment, the pricing and most significantly the condition of your products.
These are some of the factor you need to assess that will help you in the end recharging on how to drive sales?.