What happens if you have a great product that’s wanted by your customers, impeccable service that gets them to return often, and your marketing campaign looks good; however, you just can’t increase your revenue beyond the loyal customers that you have right now?
You should examine the potential customers that exist in your location to determine if there are enough to sustain your business. For some business owners, the solution to your financial challenge may be to take your business to where there is a market demand for what you have to sell. There are numerous other ways to get your products to those who need and can afford them. The Internet has allowed many companies to sell globally. Going global expands your offering to a larger target market. This can be done through exporting to foreign countries, foreign licensing, and joint ventures. It also involves developing a global strategy. If you have a product that is unique, you may be able to form a strategic alliance with a well-established distributor in another country.
I met an individual who was a U.S. citizen, but had lived in Japan for several years and made some important contacts. His business was to broker deals with U.S. companies who wanted to sell to Japanese customers, but would have a difficult time breaking into the tightly-held distribution system already in place. He earned either a percentage of what sold or was paid a flat fee for his services. His clients benefited by increasing their sales exponentially.
You can also find brokers who will negotiate deals with businesses in numerous other countries that have a demand for what you’re selling. In addition, a product that is on the decline side of their product life cycle in the U.S. may experience a renewed demand in countries that are behind the technology curve. For example, it would be next to impossible to make a living selling the older, manual typewriters; however, in some developing countries or places without adequate electricity, they might be a welcome product.
Location can be an extremely important factor to consider when you start your business. With all other factors the same, you may be able to sell much more of your product in one area of the country than in another. This may be due to a larger population or a more affluent community. Brendan and John Ready were two brothers who grew up in a lobster fisherman family in Maine. They learned the trade from their father and would sell their lobsters off the docks, just as other fishermen did. One day they decided to go against tradition and they drove for two hours to sell their lobsters to wealthy customers at Martha’s Vineyard. The results were worth the inconvenience of the two hour drive because they sold all their lobsters and made three times as much revenue as they would have from selling on the dock.
When I lived in Logan, Utah, Kerry was one of my clients who made his living as a videographer, specializing in wedding videos. His top end video cost about $600, and he didn’t have much money after paying for his expenses. Within a few months of working with him, Kerry more than doubled his sales, but I told him that if he wanted to make more money he was going to have to move to a larger city. I was thinking of Salt Lake City, but he was even thinking bigger and moved to a retirement community in southern Florida that was much more affluent than Logan. There he was able to sell similar videos he made in Logan, but he charged $3,000 or more for them. That’s five times the amount for the same product. Not only was he able to earn more per client, but there were more clients willing to pay his higher fees. Needless to say, Kerry’s sales increased by more than 500 percent and his profits were even greater.
Let’s go back to the Ready brothers and their lobster adventure. After graduating from college, they tested a big breakthrough idea they developed in school called Catch a Piece of Maine. This was a membership club that planned to sell for about $3,000 and it included a dedicated lobsterman, your own lobster trap, and a specific number of gourmet lobsters delivered anywhere in the country. It also included other delicacies from Maine, and each shipment included a DVD of your lobsterman showing your catch before it was shipped, as well as a map of where your lobsters were caught and other personalized gifts.
Many people told the brothers that they were crazy, their idea wouldn’t work, and no one would buy… until the money started pouring in. The brothers had expanded their idea beyond the docks of Maine to sell to individuals who felt the concept was worth more than the high price. Brendan and John Ready weren’t just selling lobsters, they were selling a unique experience that would involve the customers in the lobster catch and turn them into partners by developing a relationship with their lobsterman.
The brothers had a goal to make over $1,000,000 in their first year by selling 400 memberships at $3,000. They ended up selling 200 memberships in their first three months and more than 400 in their first year. In addition, they have enthusiastic customers who are compelled to share their adventure with their friends. If a client has a party where the lobsters are served, they can show the DVD and brag about “their” lobsterman in Maine, who caught the meal for them this morning! You can catch their business at www.CatchAPieceOfMaine.com.
No comments:
Post a Comment