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Monthly Archives: September 2015

Hammernik Weighs In On Whether To Lower Your Prices

We’ve been sitting down with some of our business owner clients for end-of-quarter planning and evaluation (as well as to get everything in before 9/15). Always enlightening for us here.

And what some of them are telling me is that they have been feeling a rising pressure from their employees, competitors and (less often, ironically) from their clients, to lower prices.

I have been known to weigh in on this topic. And I will do so again…

Hammernik Weighs In On Whether To Lower Your Prices
“You get the best out of others when you give the best of yourself.” – Harry Firestone

I discuss this all the time with my business owner clients — how to price their services. You see, often we might hear consumers say, “Well I would buy it if it were in my price range.” And, that idea tempts many business owners or sales people to lower their prices — just to sell more products.

This can be an extremely powerful urge.

However, as you already know, price reductions often create more problems than they solve. I’ve seen too many businesses (my clients) jump down to lower prices without consulting someone objective, only to see their revenues, profits AND business fall.

Here’s some of what you might see price reductions create within your business:

* Decrease of net profits
* Customers rush to the purchase of lower quality products
* Increasing customer demands to drop the price even lower
* Requirement of even more sales to make up the difference in revenue
* Needing a larger quantity of products and inventory to make up for lower margins

And, in the end, there will always be someone willing to go out of business faster than you. And you can’t (nor should you want to) keep up with that.

Remember this: price is not a benefit. The close of a sale is usually not determined on the cost of your product. If you properly “sell” your customers and prospects, they will purchase your products/services no matter what price you determine.

That’s the plain truth — and you’ve probably seen it in your own purchase patterns.

If a customer or prospect doesn’t buy — and they claim the cost had something to do with it — you can guess they probably wouldn’t have purchased anyway.

As a small business owner, and marketer, your job is to sell your products and services. But the actual art of selling has nothing to do with the price of the product.

By the time your contacts find out about the price, they should be determined to purchase no matter what the cost.

So, find “real” benefits (value) to sell to your customers and prospects. Help them to see how great their life is with your product, and you’ve got a customer. Point out their current pain, and your contact will do anything to get rid of it.

Set your prices and hold fast. If you’ve marketed correctly, you will still have customers anxious to do business with you.

If you’d like to sit down and conduct an analysis of your pricing strategy, this is something which we’re very equipped to help you with. Give us a call ((414) 545-1890) or send me a quick email (click the email button at the top of this page)

Feel very free forward this article to a Waukesha County business associate or client you know who could benefit from our assistance — or simply send them our way?While these particular articles usually relate to business strategy, as you know, we specialize in tax preparation and planning for Waukesha County families and business owners. And we always make room for referrals from trusted sources like you.

Warmly (and until next week),

Dale Hammernik
(414) 545-1890

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Hammernik On 7 Ways To Increase Existing Customer Sales

Many Waukesha County area small business owners believe that the easiest customer to “sell” to is a referral customer, but in point of fact, the best kind of customer to sell to is … one you already have.

So, that being the case, it sure does make sense to make an investment in your relationships with your customers, yes?

You may have noticed that this is a theme I return to frequently here in my blog for Waukesha County small business owners. Why do I that?

Simple: as we look at continued uncertainty in world and national economies, the one asset that can never be taken away — and your *greatest* advantage over any other business in your space — is the relationships you have with your customers.

So, as your numbers cruncher and (perhaps in some sense) “coach”, I know that when I can convince you to make this kind of investment, you’ll thank me — and use my accounting services here at Hammernik & Associates for longer! So it’s not simple “charity” on my part to keep spending time on these Notes for you.

I hope that’s not disillusioning. After all, when you and your Waukesha County-area business do well, it helps us to stay in business.

But all that aside, here are some more ruminations on this theme, specifically about how to use direct mail to build those “existing customer” relationships…

Hammernik On 7 Ways To Increase Existing Customer Sales
“We must find time to stop and thank the people who make a difference in our lives.” – John F. Kennedy

I’ve spoken before about the value of a regular communication plan with your existing clients and friends here in Waukesha County (and beyond). And as I’ve done so, here are some things which I’ve discovered for you to carefully consider:

#1: Most Waukesha County small businesses pay too much in chasing new customers and too little in building repeat business with their current customers.

#2: The satisfied customer will likely purchase again. And they will purchase more, and will purchase something different.

#3: It definitely costs less to motivate a known customer to purchase again than to acquire a new customer.

#4 BIG IDEA: Customers are only fickle because a new competitor is paying more attention to them than you are.

In B2B, many companies make the huge mistake of having all their contact with their customers go through a sales representative. This leaves the customers vulnerable to theft if the representative jumps to another employer (especially if they are local in Waukesha County). It also leaves too much opportunity for negligence on the sales rep’s part.

Regardless of the layers of distribution between you and your customer, it’s a good idea to establish some direct link. The owner of a restaurant can do that by coming around and chatting personally with the customers. The chief executive officer of a large company can do it with a newsletter and maybe a hotline telephone number or an open email address.

Direct mail is also perfect for cutting through these layers (in addition to, and on top of email). Here are some of the ways that direct mail can be used to communicate with established customers.

#1: To introduce new products or services.
#2: To give advance notice of and explain price or fee increases.
#3: To offer special discounts or premiums.
#4: To provide useful information.
#5: To give recognition to top customers.
#6: To announce seasonal sales.
#7: Warm relationship building for its own sake

I’ve rarely seen a business that could not increase and improve through increased direct marketing to current customers.

Do not make the mistake of assuming knowledge on the part of the customer.

Do not take shortcuts with existing customers and do not feel that you are boring them by telling the same story repetitively.

If you have quality, service, guarantee, price or other advantages, point them out each and every time you deliver a sales presentation.

American business — especially here in the Waukesha County area — desperately needs to place a new higher value on the customer in this economy. Communicate more with your customers and you’ll do more business.

Feel very free forward this article to a Waukesha County business associate or client you know who could benefit from our assistance — or simply send them our way?While these particular articles usually relate to business strategy, as you know, we specialize in tax preparation and planning for Waukesha County families and business owners. And we always make room for referrals from trusted sources like you.

Warmly (and until next week),

Dale Hammernik
(414) 545-1890

Hammernik & Associates

Hammernik’s 4 Tips For Sending Better Marketing Messages

First, I did want to make sure you knew about the looming deadlines:

1) Estimated taxes for the third quarter are due on Tuesday, September 15th. If this applies to you, you know who you are. We’d love to help you, though, if you need a quick word of advice. Shoot me an email (click the email button at the top of this page).

2) Corporate filings are also due on the same day (9/15). Again, you know who you are, if this is for you … but let these simple reminders not be wasted!

Secondly, I wrote last week about how we can peel away from the “old” style of adversarial selling, and got some great feedback. THANK YOU for that — I put a lot of heart and thought into these notes, so your feedback is always appreciated. I have some additional, different thoughts this week.

I think it’s high time that we all realized that our customers and prospective customers have become “wise to the game” when it comes to certain, antiquated marketing tactics.

There’s a better way, now being adopted all over the place, but not just because it is very effective … in my opinion, it’s a much more ethical and principled way to sell.

Hammernik’s 4 Tips For Sending Better Marketing Messages
“You don’t lead by pointing and telling people some place to go. You lead by going to that place and making a case.” – Ken Kesey

“They” say that we’re all being slammed by over 3,000 marketing messages a day, and I believe it. Some, more than others, of course — but you have to know that your prospective customers are seeing something like that amount. Daily.

That’s a lot of messages.

And, in order to avoid information overload, many of us have trained our minds to completely ignore those messages.

That’s why you must properly implement a series of steps to *lead* your prospect to becoming a client — effectively AND ethically. Effective, because it actually works. Ethical, because it’s about delivering ALL of the information needed for a purchasing decision … and it’s not reliant on “sneaky” sales tactics.

And once you *implement* these steps to leading your customer to a sale…you can easily overcome those marketing filters your prospects have.

Here are the steps:

1) Get to know them.
When you know everything there is to know about your prospects, your messages become much more targeted. Which gets your prospect’s attention. And, your prospects will feel as though you truly care about them.

2) Follow up consistently.
When you consistently and effectively follow up with your prospects, your message will eventually sink in.

3) Offer your prospect actual value.
Every marketing message out there is an attempt to get your prospects’ money from their wallet. Imagine how you’ll stand out when your message does more than make a pitch. It educates, engages, entertains and/or helps your prospect in some way.

4) Value your customers.
Once your prospect becomes your customer, don’t abandon them. They need the same attention you offered them as a prospect. Offer that same personal attention and they will become a raving fan!

These are things which I’m consistently emphasizing to my Waukesha County business owner clients and friends. It’s because they work. And it’s a much more satisfying way to build sales.

Feel very free to share this article with a Waukesha County business associate or client you know who could benefit from our assistance — or simply send them our way? While these particular articles usually relate to business strategy, as you know, we specialize in tax preparation and planning for Waukesha Countyfamilies and business owners. And we always make room for referrals from trusted sources like you.

Warmly (and until next week),

Dale Hammernik
(414) 545-1890

Hammernik & Associates