Several years ago, Cameron Herold wrote a book entitled Double Double: How to Grow Your Revenue and Profit in Three Years or Less. Cameron was the former COO of 1-800-GOT-JUNK and was instrumental in growing the company from $2 million to $105 million in revenue in six years. In addition, he has helped dozens of companies in seventeen different countries achieve similar results. His perspective on business and his insights on selling and marketing are fascinating and his analysis of what it takes to grow when you’re slow and get where you want to be are right on target. The book lays out a plan, but more importantly details what you must focus on to get these kinds of results. Since all of us have a limited amount of time to get done what we want (especially as you seek to grow your business as you come out of this business quarantine), we must focus on what really matters.
Herold says this in the introduction to his book:
“This book will show you how to double the size of your company’s revenue and profit in three years. The steps I describe to achieve 100 percent growth of your business over three years are simple, but they require one absolutely essential discipline. Focus. If you are an entrepreneur and the leader of a $500,000 to $50 million company, you have to focus intently on everything you do to grow quickly and successfully. There’s no room for running around unsure of what you’re doing and why. Everything must be on target and geared toward that specific growth goal.” –p. 1.
In this post, I’d like to share with you the four lessons I’ve learned from this book and the coronavirus quarantine that you can apply at your business to dramatically increase your sales and your profits along with my perspective of what it takes to have great growth.
1. To grow fast, slow down.
This may seem extremely counter-intuitive. How can you grow faster by slowing down? There are three reasons why this is true.
First, if you don’t take time to recharge and slow down, you will burn out. Having a renewed sense of focus and excitement about your business when it opens up again will help you come charging back instead of dragging yourself back.
Best-selling author Stephen R. Covey calls this habit sharpening the saw. He says:
“Sharpening the saw means attending regularly and consistently to renewal in all four dimensions of life. If sharpening the saw is done properly, consistently, and in a balanced way, it will cultivate all the other habits by using them in the renewing activities themselves.” –The 7 Habits of Highly Effective Families, p. 277-278.
Second, stress takes its toll. If you aren’t taking time to de-stress daily and weekly, you will hurt yourself and everyone around you. No one enjoys being around someone who is stressed out. Be sure to take time for yourself and slow down from time to time. Many times, we feel like we can’t slow down because we are too busy or because we absolutely need a specific result and don’t trust ourselves to take time off since the goals that must be reached are always there. I’ve talked with many entrepreneurs over the years who have told me that they can’t hire anyone because they have to be in the business all of the time. This isn’t true. You can and should find someone to be in your business that you can develop into a leader so you don’t have to be there all of the time. Then, when you return from your day off or weekend off, you can come back re-energized. You should give this time to your team members as well. This is so important, especially now as you’ve had some time to think and perhaps reprioritize your goals. This time you’ve had to reflect and refocus can easily be overtaken by stress once your business is back up and running. Remember, take time for yourself and allow your team the same opportunity, or you may find yourself falling back into habits that won’t help you achieve your goals.
Third, nature and facing turbulence can teach us a lot about how to deal with stress and challenging times.
Former Lufhansa pilot Dieter Uchdorf shares this principle about how trees grow in nature and how pilots deal with turbulence. What he says about how nature and seasoned airline pilots deal with challenges and moments of stress may surprise you. He says:
“It’s remarkable how much we can learn about life by studying nature. For example, scientists can look at the rings of trees and make educated guesses about climate and growing conditions hundreds and even thousands of years ago. One of the things we learn from studying the growth of trees is that during seasons when conditions are ideal, trees grow at a normal rate. However, during seasons when growing conditions are not ideal, trees slow down their growth and devote their energy to the basic elements necessary for survival.”
He continues:
“Have you ever been in an airplane and experienced turbulence? The most common cause of turbulence is a sudden change in air movement causing the aircraft to pitch, yaw, and roll. While planes are built to withstand far greater turbulence than anything you would encounter on a regular flight, it still may be disconcerting to passengers.
“What do you suppose pilots do when they encounter turbulence? A student pilot may think that increasing speed is a good strategy because it will get them through the turbulence faster. But that may be the wrong thing to do. Professional pilots understand that there is an optimum turbulence penetration speed that will minimize the negative effects of turbulence. And most of the time that would mean to reduce your speed. The same principle applies also to speed bumps on a road.
Therefore, it is good advice to slow down a little, steady the course, and focus on the essentials when experiencing adverse conditions.”
That is great advice. As you speed up, you have to take time to slow down or you’ll burn out. Then, when you return, focus on what really matters and you’ll get more done. Also, take time to plan something fun that you’ll have to look forward to as you move forward with your daily activities. This may be a week, a month, six months or a year out, but it should be something that excites and motivates you to do what needs to be done. It is best if you can tie aspects of the reward to the specific accomplishment of successful mini-goals on the way to your daily, weekly, and monthly goals.
2. Have a vision or painted picture that details exactly what you’re working towards.
Herold says: “The goal of doubling your company’s size in three years is easy to accept. Who wouldn’t want to do that? But accepting this goal and realizing it are two different things. To achieve it, you need to prepare for fast growth. And to do that, you need to develop a detailed vision of the future. Many people create goals for the future but don’t really have a vision of what their company will look like at that point. If revenue is supposed to triple or quadruple, what will that do to the company? How many people will need to be on board? Will you still be in the same [location]? Will you have more than one location? Will you be providing different services? What might some of those look like? If creating a picture of your company is worth a thousand words, creating what I call a ‘Painted Picture’ of your company is worth big money.” –Double Double, p. 5.
When you think about your business growth in the next three years, what do you see? What will your business look like in 2023? What will your revenues be? Who will be there? Who will no longer be there? Imagine that you have hired a company to come in and film a documentary about your incredible growth as part of a series they’re doing on business success stories emerging from the recession. What does that film look like? Play the film in your mind and then write down the details of what you see. If you don’t think about this, you will end up somewhere else.
I really like this comment by Cameron Herold about how you can do this. He says:
“Pretend you traveled in a time machine into the future. The date is December 31. Three years from now. You are walking around your company’s offices with a clipboard in hand.
- What do you see?
- What do you hear?
- What are customers saying?
- What does the media write about you?
- What kind of comments are your employees making?
- What is the buzz about you in your community?
- What is your marketing like?…Are you launching new online and TV ads?
- How is your company running day to day? Is it organized and running like a clock?
- What kind of stuff do you do every day? Are you focused on strategy, team building, customer relationships, etc.
- What do business financials reveal?
- How are your core values being realized among your team members?”
He continues:
“Cover every area of your business: culture, staff, marketing, public relations, sales, IT, operations, finance, production, communication, customer service, engineering, values, employee engagement, work-life balance, etc….Remember that you are envisioning all these aspects of your company after it has doubled in size.” –p. 10.
I think you should break down your summary into the following areas and then write your own description underneath it:
- What I spend my time doing – What a day in my life looks like
- How I feel
- What we’re selling (divided out in product categories and product lines) – you can also rank these by profitability with plans to eliminate what isn’t at a certain profitability level
- What my personal celebrity and business brand look like
- What customers are saying about my business
- What my systems look like
- The number of appearances I’ve had in the local media
- Profitability and what we’re able to do as a result
- My personal time – what kinds of trips or things will you be able to do or have (what does your weekly schedule look like)
- Time with family and friends
It will take you some time to put together a three to four page summary that outlines each of these areas. The key is to focus on where you’ll be, not how you’ll get there. Allow yourself to dream again. Think about where you want to be. If you start thinking about how too early in this process, you’ll shut down your thinking process and won’t allow yourself to dream.
Then, once you have it all written down, you’ll want to reverse engineer it to see how much you’ll need to do on a monthly, or weekly basis to make this happen. For example, let’s say your goal is to be at $1 million in sales in 3 years and you’re currently at $500,000 a year. In order to make this happen, you’ll need to back down the goal into three smaller goals. If your average sale is $1000, you’ll need to sell an additional 500 products in that third year than what you are selling now. That means, you’ll need to sell an additional 9.6 products a week or 1.6 additional products per day (if you are open 6 days a week). Then, you can start breaking down how you’ll make that happen based on the number of prospects coming into your business and your close ratio. If you are only at a 50% close ratio, you’ll need to bring in 3.2 additional customers each day to make that goal a reality. Now, if your closing ratio is higher, you’ll be able to hit that goal much quicker.
This gives you a quick idea of how to put break down your goals into manageable and bite size chunks. You can also determine these by going through the following sequence of questions:
- What has to happen in order to reach the goal? (List the specific outcome or all the steps)
- What must be done first?
- Who will take charge of each outcome? Who will best suited for that task?
- What is the deadline by which the outcome must be reached?
You also have to have clear boundaries about what you will and won’t allow in order to hit your daily, monthly, and weekly goals. I once fired a sales consultant in our business who had a 62% close ratio over the previous 30 days. Why? Why would I let go of a consultant who many would be thrilled to have selling at that level? The reason is two fold. First, I was looking at what she wasn’t doing that one of our consultants who is closing at 80 to 85 percent is doing. Secondly, she was overall a ‘B-’ player. I don’t want our top performers and ‘A’ players to feel like they are being pulled down from reaching our sales goals. They also see I’m serious when such a decision is made.
What are your boundaries? What do you allow? What won’t you allow?
I really like what Herold says about this. He says:
“Once you have the goals set and the team is committed to hitting them, the next thing you need to do is discuss boundaries. That is to say, yes, you want to hit these goals, but at what expense? Would you work ninety hours a week to hit them or, at maximum, forty-five? Would you give up equity in the company to raise money to help you hire people to hit the goals? What won’t you do? Are the things you are committing to do within your company’s core values? Here are some topics that are worth discussing while you create your own list of boundaries.
- Amount of debt you’ll take on
- Number of hours you’ll work
- Number of days you’re willing to travel
- Percentage of profits you will share, 0 to 100%
- Percentage of equity you will give up in the company, 0-100%
- Number of acquisitions you will make, if any
- Willingness to fire ‘C’ or ‘B’ players.” –Double, Double, p. 30.
These are some great questions to think through for your business. The clearer you are about your boundaries, the more likely you are to end up with what you really want.
3. Follow Herold’s Top Ten Ways to Make Money in a Recession.
Here are Herold’s top ten ways to make money in a recession. I’ve followed his comments with my own in italics. He says:
“I’ve divided the ten tips into two sections: first, counterintuitive pieces of advice, and second, four boring but tried-and-true ideas. All of the ideas work, but a few of them will feel contradictory to what you may have heard is the ‘right’ way to behave in business, and that’s the point: while everyone else is shutting down production, you’re going to be planting the seeds for growth.”
Counterintuitive Tips
“Each of the six items in this section is contrary to what you would expect, particularly when sales are slow, but I promise you they can yield significant results as you march toward the goal of increasing your growth by 25 percent every year for the next three years.
Tip 1: Increase your expenses.
“Because personnel is usually the largest line item in any company’s budget, a surefire way to increase your expenses is to increase the number of people who work for you and/or reward the ones already in your employ.
“Hire another salesperson. When your competitors are slowing down and grumbling about the recession, they start worrying their employees. When competitors start laying people off, the great employees fear for their jobs too. If you’re hiring salespeople when everyone is laying them off, the positive buzz that you’re still hiring will start to spread. What’s even better? Imagine hiring one of your competitor’s best salespeople. It would impact both of your companies in precisely the way you want to in a competitive world. I know it seems odd that while in the middle of a recession you’d want to hire more people, but the people you will be hiring are the rainmakers. You’re hiring people to increase sales, add money to your gross margins, and increase buzz about your company and brands.
“Give everyone a raise. Make raises 100 percent commission based, but give everyone a stake in finding new business….When everyone in your company has a stake in the outcome and can make more money by bringing in clients or employees, they will work to help you build your business. Also, teach your employees how to network. Give them marketing pieces with a promo code customizable to that employee. Help them make more money, and they will too.” –p. 154.
This does seem like a counter-intuitive move, but as long as you are hiring those who bring in sales at a very high percentage (70%+ as a minimum), you’ll do great with those kinds of sales consultants. When my wife and I were in the bridal business in the recession of 2007-2008, we hired one of the top performers of a local competitor. I wouldn’t normally hire someone from a local competitor (as the cons usually far outweight the pros). However, in this case, after watching her work our booth at a recent bridal show, having a successful interview and watching her sell this past weekend, I am confident that we’ve made a great choice. I conducted three interviews with her before I considered hiring her. There is a lot of wisdom in that as well. The best thing was that I learned a lot from the interview about what our competitors do (and how they measure their consultants’ success which was very informative and valuable).
Tip 2: Fire your customers.
“Eighty percent of your results come from 20 percent of your clients; so, at minimum, fire 20 percent of your clients. They are sucking up 80 percent of your time. Feels odd to be thinking about getting rid of some of your revenues at any time, let alone during an economic downturn, but these clients likely generate very little revenue, and perhaps even cost you money. So get rid of them.” –p. 155-156.
In any business, it seems crazy to even consider dropping any customers that do business with you (unless they are the crazy ones that all seem to come out when the moon is full). In order to do this, you have to shift who you sell to and focus on selling to more affluent customers. This ties into tip #3.
“Tip #3: Someone has money, so go get some of it.
“Strong companies and rich clients always have money. [This is] true even in recessions. In fact, that’s where the old adage that ‘cash is king’ in a recessionary market comes from. Many companies saw this coming and moved into cash a long time ago. They’ve been waiting for deals. They’ve been waiting for the market to turn. They’ve also waiting to buy from you. Sell to them. They’ve got money. Some of it could be yours.” –p. 156.
Costs are increasing. The reason why this is happening is because the middle price point market has dropped out and you’re seeing more budget conscious prospects who want what they want and are willing to pay a higher price for it. Focus on more affluent customers and your overall price of what you sell will increase as well. Five benefits to selling to more affluent customers are:
1) You can grow quickly with faster speed (fewer transactions, higher transaction size). Instead of selling a $1000 product to 1,000 customers, you can sell a $2000 product to 500 custoemrs to get to the same number when selling.
2) More profitability – will give you a powerful sustainable advantage (you can spend more to get customers in your doors)
3) You can reach your personal goals faster – when you are more profitable, you can take profits out to create your own personal financial independence
4) There are fewer competitors in this space (most people don’t gravitate to higher prices, they usually gravitate to the lowest resistance and seek to sell for lower prices)
5) You can provide a more superior experience for your customers (make it more amazing so that you become the dominant, preferred, celebrated business in your market niche) When this happens, customers will seek you out because you can and do provide the best experience.
“Tip 4: Eliminate competitors.
“Ray Kroc grew McDonald’s from a few locations to the enormously powerful brand we all know (and secretly crave). He also had a particularly cutthroat saying about business: ‘When the competition is drowning, stick a hose in their mouths.’ Though brutal, Kroc understood that the best time to eliminate his competitors was when they were weakest—during an economic downturn when they had left themselves vulnerable. I once saw a Nike T-shirt that said. ‘Somewhere, right now, someone is practicing. When they meet you head to head in competition, they’ll beat you.” –p. 157.
Look for your competitor’s vulnerabilities. When you are in front of customers in your business, do you help them see the futility of buying a product anywhere else and by helping them see what a great overall value you are? As an example, you can do this by offering a first time purchase incentive, a generous tiered referral program, and coupons to downstream businesses that they can’t get anywhere else. When you beat your competitors on the field of battle with your customers, you’ll move up the field towards the goal line and your competitors will get up wondering what happened.
“Tip 5: Start stealing—legally.
“Customers will switch from your competitors right now for even the smallest discounts or bonus offers, so steal them away. You can’t go so far as predatory pricing, but in a slowdown, virtually everyone is looking to save a buck.” –p. 157.
Offer first time incentives so that prospects cancel their appointments at other businesses. You can mark things up to take them down and do the same to give the appearance of greater savings when you carry private product lines the other businesses don’t have access to and when you already have a healthy margin. I knew a caterer in the wedding business that offered 50% off invitations with the purchase of a catering order. The great deal on the invitations often persuaded the bride to book her catering business with this company. The owner told me that he didn’t care about the revenue from the invitations, he just used it to steal brides away from the competition before they had a chance to see what other catering options were available.
“Tip 6: Find money under your company’s pillow.
“You’ve already got lots of products or services, so why not rebrand them or remarket them?….Another area to find cash under your company’s pillow is by considering selling off a small equity position in your company. You’ll be able to realize some cash for what you’ve built already, and you could have a major opportunity if you sell a small position to either a current or large supplier or customer. If they own 5 percent of your business, you’ll get 100 percent of theirs.”—p. 158.
You can easily bundle in-stock items together to help you move them faster. Another way to do this is to incentivize your bridal consultants when they sell certain items. One of my retail coaching clients emailed me and told me: “I decided to put a point system to reward my consultants for selling discontinued products….They are accumulating the points until July 31th that’s when they can redeem their points for gifts from gift cards to spa packages. I wanted it to be accessible to every one on staff.” As a result of implementing this idea she has sold an additional 13 wedding dresses so far. The staff is motivated and rewarded for selling the discontinued merchandise.
Do you have discontinued products that you need to get rid of?
Can you bundle these types of products with other in-stock items you have to help you move them faster and move them out of your business?
Are there other alliances you could form with other industry related businesses that could help you increase your sales and profits?
Look for ways that you can find the hidden money in your business and bring it out so you can convert those items into cash.
Now, let’s move into the tried-and-true tips:
Herold continues:
“If you tend to be risk-averse, you’ll probably be more comfortable reading these four ways to make money in a recession than you were considering the six counter-intuitive tips.
“Tip #7: Stay positive.
“There will be a long slowdown or recession—so what? We’re going through a much-needed correction in the market, and the strong will come out even stronger. In every recession, companies still do well. Choose to be one of them. Remember: like attracts like. Stay positive and you attract positive things. If you’re down and gloomy, you won’t attract anything worthwhile.” –p. 158.
It isn’t enough to stay positive. You also have to do something positive everyday that will turn into more business. In my new book, Clear and Present Game Changers, I explain how you can positively align yourself with other industry vendors and actually do something instead of just staying positive. You won’t stay positive very long if you aren’t generating sales and profits and that entails actually going out and doing something.
Tip #8: Stay focused.
“Don’t keep adding stuff to your To Do list. If anything, start crossing stuff that doesn’t need to be done off your list. For example, if it won’t have an impact on sales going up, profits going up, or costs going down—stop doing it. Each morning (or the night before), write down the top five things you need to get done that day. Then start working on number one until it’s done. Then move on to number two. If you are diligent and stay focused using this age-old method, you and your team will grow during any downturn we have.” –pp. 158-159.
Tip #9: Reinforce your relationships
“The great thing about an economic slowdown is that it gives you more time. You can use this time to reinforce relationships inside and outside your company. Inside the company, take the time to get to know people better. Indulge them in activities you know they enjoy. Bring employees along with you [on buying trips]….Set up random lunches a few times a month and invite three to five employees you rarely spend time with. It all makes a huge difference when you are trying to grow.”—p. 159
The stronger the relationship you have with a customer, the more likely it is that you will do more business with them and you’ll sell additional items that you didn’t sell before. The same is true with your sales consultants. Ask their opinions and advice about things you are doing or considering at your business. They will give great insights and advice. I ask my top selling consultants each week what they feel I should train on. The objections they’re facing are also affecting the rest of the team. I’ll occasionally ask them to conduct the training meetings and share what they’re doing when their sales are really high. When you trust others, they’ll trust you more and you’ll be able to grow together. When we were part of a industry buying group, we would take our top performers with us to get insights on what products they felt would sell best in our business. As your business grows, you’ll rely on this type of advice much more, but don’t discount the importance of developing those relationships now.
Tip #10: Watch your cash flow.
“Look for all the areas in which you can cut expenses—except advertising and marketing. Obviously, if you cut those, you will see a slowdown of your own making. Really look for waste in your company and start cutting it fast anywhere you can. Cut the people you’ve been wanting to fire but didn’t have the guts to. Cut any ‘dead weight employees.’”—p. 160.
Are you spending more efficiently on your advertising and marketing to get customers into your business? It isn’t enough to just throw money at your marketing. You’ve got to know what works and put money into what delivers results. We’ve shifted much more of our emphasis online to generate leads. Make sure you are tracking what is working and tweak what is to get even better results.
4. Focus. Take action now.
Study what I’ve written here and make your own list of what you will focus on and what you will accept in your business. If you want to grow when your business is slow, you have to do the things that will turn your business around and get you to where you want to be. Waiting for things to turn around won’t get you where you want and need to be now. Learn from those around you who are growing now and do what they’re doing. There is no excuse for being stagnant. Businesses will grow in this new and shifting economy and there is no reason why you can’t too.
