As a business, your goal is to improve every year by finding ways to increase sales and traffic to increase your overall net profit – or the ‘bottom line’ of your income statement. However, it can be tricky deciding what the best approach is for your business to take to grow your bottom line. The first thought many business owners have is “I need to increase my sales if I want to increase my bottom line” which is partially true, but there’s more to it than that. As a business owner, what you should really be focusing on is controlling the cost of expenses in addition to how you are fueling your sales. What are you putting money into for your business that is yielding the best results? You need to think about what you’re spending and how that’s affecting what you’re gaining back from it whether it’s spent on resources or advertising.
Most commonly a business owner, asks this important question – Should I hire a sales team to help sell more, or should I spend money on advertising?
Let’s look at “Should you hire a sales team?”
Many business owners think that for the business to be successful, they need to spend money on a sales team right away to make sales faster and bring in more customers. The truth is there is no “one size fits all” when it comes to a successful business plan. Some owners make the mistake of hiring a sales team too early and blowing their budget, others make the mistake of hiring a sales team when it’s too late missing out on big opportunities and lost revenue.
Before you decide to hire a sales team, you need to be confident in what you are selling and need to be able to show new hires how to sell your product. That is why YOU should be your first salesperson. Once you understand your customers directly and you start to see your workload increase due to a rise in customers and demand, then it will be time to start hiring help. But you need to be able to train your new employees on what your product is, what problem you solve, and how to sell your product – remember to always make time to train your sales reps on how you want your product to be sold. This is your business after all. Although, you might be inclined to think if you hire a salesperson they will just “know” how to sell for you but, the more work you put into planning, educating, and training the more you will get from the relationship.
Now let’s look at “Should you spend (more) on advertising?”
A big misconception about advertising is that the more money you throw at it, the more of a return you will make. However, again, there is no “one size fits all” (or in this case, “one budget fits all”). Advertising doesn’t need to be expensive; it just needs to be smart. So, before you go and decide to throw more money at your current advertising plan, review your business KPIs such as your cost per lead, cost per sale, and average customer retention span. In order to spend money on advertising, in a way that makes a definite impact on your bottom line you have to know and understand your numbers.
There is more to it than what type of ads are you placing, how relevant the content of your ads is, and when you might run sales or promotions. When we review the marketing plans of new clients who partner with us the first questions are “What have you done that worked? And, “What have you tried that hasn’t”. Additionally we will ask, “How closely did you track your results?”
Not all advertising has to be paid either. Are you taking advantage of any free marketing tactics such as social media marketing? Where are you networking? Granted with these tactics you’re investing time and time is not “free” but it’s affordable depending on where you are at in your business today. When planning for success you want to really dig deep and evaluate what’s working and what isn’t working with your advertisements – you may be surprised at how small the fix may be. Or, you might find that XY didn’t work but, Z is actually the tactic that drives your best result, in which case that is where you want to invest more money to really grow your sales.
So, how do you decide which you need? Sales or advertising…
You need to look at what you sell, how it sells best, who buys it, and how they like to buy it, alongside of everything mentioned above which can be really time-consuming and maybe even inconvenient. But, when you invest that time, you will increase your return on investment no matter which choice you make.
In fact, we’re so sure of it that if you would like a full evaluation of what your current return on investment is in your current marketing or advertising campaign, book a FREE consultation with us and let’s talk. In as little as 15 minutes we can give you an overall idea of which would be the best plan of action for you. All you have to do is book a consultation with us by calling 705-242-8964 or click here to book with us online.
