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Work as a Team

By Brad Sugars All too often the cry is heard you cant get good people or why cant I get my people to do as I tell them. Well heres a few ideas that may make life a lot easier. Consider for a moment, the business owner who has 10 people working in the business, yet theyre the ones doing all the work. Whats the point!? Firstly, lets get back to basics. Most people in business will understand how important systems are. Systems are usually responsible for having a business that runs smoothly (and profitably). With systems in place, its simply a matter of employing people to run those systems. Michael Gerbers fantastic book, The E-Myth, really highlights how important systems are for businesses to be successful. A real life example of course is McDonalds. With a food product that at best, could only be described as average, it is simply a matter of systems that keep it a hugely successful entity. The point is, get the systems built in your business. If you feel like youre banging your head up against a brick wall, take a look at the systems in your business. Look at the most basic things from answering the phone all the way through to how you produce your product. If your systems arent clearly defined and easy to understand, how can anyone understand what you want. Preferably write them down and turn them into checklists. This is the basic foundation of business and in turn getting your people to work as a team, something that equals more than the sum of its parts. So, the systems have been built and are clearly defined, and now its a matter of recruiting the right people to run those systems. The DISC working personality profile can really help in selecting the right people for the job. With this knowledge, you can then recruit the right people for the job. However, the real challenge lies ahead. Its not just a matter of having people who come in, follow the system and get the job done. What you are looking for now is SYNERGY! Synergy comes from having people who are committed to a common goal. If people are involved in setting the common goal, they are generally more likely to commit. If you , as the business owner are dictating to your team this is the goal, dont expect much commitment. If your team has ownership, they are much more likely to achieve. Ownership is also very useful when designing and building your systems, let alone setting goals. Keep asking the team this questionIm looking for [certain outcome], how do you think we should go about achieving that? The successful business owner has team members that say I think we should do like this. An unsuccessful business owner has team members that say I dont know, youre the boss. Finally, be aware of what you are teaching your team. By this I mean, if a baby cries and it's mother comes running. What will the baby lean to do after a while? Exactly, let out a cry and in rushes Mum. All I ask is for you to be very aware of what you are teaching your team. If youre saying to yourself no-one can do it like me and you jump in and do it, your team is learning from that.
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5 Ways
By Brad Sugars At ActionCOACH our goal is to help business owners achieve true business success through analysis and systems implementation. What that means is that we help the self-employed build a profitable commercial enterprise that works without them. After all, systems should run a business, not the owner. The first thing we do is to access the business by working with the business owners to determine where they are, where they would like to be, and then helping them implement systems and strategies based on what we find to be the most appropriate for that particular businesss needs (increase profitability, systems, employee training, controls, etc.). We will be assessing the business in the five key profit generating areas: Lead Generation, Conversion Rate, Average Dollar Sale, Average Number of Transactions, and Profit Margins. Those areas are highlighted in the following equation: Lead Generation x Conversion Rate = # Customers #Customers x Avg. Dollar Sale x Avg. # Transactions = Revenues Revenues x Profit Margins = $ Profits So basically, we are looking at the equation for profitability for any business, in any market, in any industry sector. Throughout all of these sectors of business, the equation for profitability stays the same. We have developed 367 different systems and strategies under these five variables. For example, Lead Generation has 73 systems that can be implemented to help business owners increase their lead flow. In addition, we have 86 systems that may be used to increase your Conversion Rate, and so on down the line. Once we have established where the business is, we are able to go back and look through our systems and determine which of those would be the most appropriate to implement in increasing the profitability of that particular business type. We use the information we have gathered on the business to put together a detailed Alignment Report that will serve as our road map to success for the next 12 months of Business Coaching. Once we have established that the business can be profitable, we move on to our secondary goal, which takes place during the Coaching process. That goal is to teach the business owner the difference between working on their business and working in their business. Small business owners can spend 60 hours or more per week just trying to keep their business alive. Most often, what we find is that they are working on the wrong aspects and end up spinning in a relentless circle until the business finally folds in on top of them. Our goal is to help them in working on
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growing their business instead of concentrating on the technical issues, which are usually counterproductive to growth. Throughout the process of Coaching we will spend about an hour each week with the business owner (depending on their needs) helping them stay focused on their goals, testing and measuring results, assisting them with potential obstacles for growth, systems implementation, etc. We hold our clients accountable for reaching the goals that we set together, and work diligently to help them achieve great results! So basically, we teach the self-employed how to become successful business owners. We teach them how to make more money for less effort, and we have been very successful at that.

Friend or Foe, the Importance of Creating Great First Impressions


By Brad Sugars We often refer to the brain as having two hemispheres: the left, largely responsible for logic, and the right, predominately responsible for creativity. This description fits what we know to be the cortex or new brain; however, there is a third dimension: the hypo-thalamus or pre-historic brain, which is in fact the brain stem and is solely responsible for instincts. Bruno Catellani of the Institute of Communication, Management and Sales in Switzerland refers to the pre-historic brain as the Guard or Gatekeeper. The Gatekeepers sole function is to decide whether you are a friend or a foe; it is incapable of thought or rationalization and reacts purely on instinct by how it perceives your approach. If your initial approach stresses the Gatekeeper, it will switch on the fight/flight response and part of this process includes shutting down all other message receptors which means any opportunity you had to communicate has just been totally closed off. Its absolutely true that you never get a second chance to make a first impression. Building the language of trust is the first step to successful customer service, which translates into building sales. So, if the Gatekeeper doesnt think, does the initial Language of Trust have to be verbal? No, the first impression you deliver is based on instinct alone. The signals that you need to give out in the first 10 to 20 seconds are instinctive, i.e. your body language translated by your movements, gestures, facial expression and eye contact are open and relaxed. Your voice modulation and tone are calm, the speed of your speech is controlled and gentle and finally, you must not invade the customers space. Other factors, which will influence the Gatekeepers decision whether you are friend or foe, are, your appearance, clothes, smell, enthusiasm and posture. Once youre past this initial first impression you can get on with developing a relationship with your prospect.

Professor Albert Mehrabian of UCLA broke communication down into three Vs as follows:

Verbal: The message itself; i.e. the words you use. Vocal: The sound of your voice, intonation, projection, pitch and speed of your voice. Visual: The posture and gestures, facial expression and eye movement that people see.

The Thomas Gordon Institute added another dimension to this research and came up with:

Words: Verbal Voice: Vocal Face: Visual Body: Visual

Both institutions measured the effectiveness of each component of communication and its contribution to believability. Here are the results of their respective research: UCLA Thomas Gordon Verbal 7% Words 7% Vocal 38% Voice 23% Visual 55% Face 35% Body 35% TOTAL:100% 100% So, the first step in delivering Great Customer Service to Create Great Sales is: Approach and greet your suspect/prospect with open, friendly body language coupled with soothing, gentle voice modulation. Our total focus in this step is to get past the Gatekeeper so that we develop and build rapport and open the prospects message receptors. The words themselves are not that important, a simple Hi, how are you today, is a good ice breaker.

Goal Setting is S.M.A.R.T. Business


By Brad Sugars Goal setting is as important in personal life as it is in business. The most common denominator in all the self-help literature and books is the importance of goal setting. Were told to set longterm goals, short-term goals, lifetime goals and personal goals. The benefits of Specific, Measurable, Achievable, Results orientated, Time-framed (S.M.A.R.T) goals have been written about in self-help books for years. So, it follows that goal setting is obviously a powerful process. It is about eating the elephant, one bite at a time and of turning vision into achievable, actionable things. Its the common denominator of successful individuals and businesses.

Despite their obvious value, our experience with goals have shown that some are good at setting goals and sticking to them, achieving great results and others cant keep a New Years resolution to stop smoking for two days in a row. Failure to set goals can be seen as a fear of failure. That is, the blow to our integrity when we dont reach our goals. When we make and keep commitments, such as setting and achieving goals, it reflects the amount of trust we have in ourselves. We increase our confidence in ourselves to make and keep commitments to others and ourselves. However, when we dont achieve our goals we lose confidence in our ability to make and keep commitments and to trust ourselves. There are many reasons why we dont achieve our goals. Sometimes the goals we set are unrealistic. New Years resolutions are typical examples. Suddenly, we expect to change the way we eat, or the way we exercise just because the calendar changes. Its like expecting a child thats never ridden a bike to suddenly jump on and go, or to run a marathon without months of training. These goals are based on illusion with little regard to natural growth. You must be able to crawl before you walk. So, how do we set and achieve goals? Stephen R. Covey says it best in his book 7 Habits of Highly Effective People. To begin with the end in mind means to start with a clear understanding of your destination. It means to know where youre going so that you better understand where you are now and so that the steps you take are always in the right direction. An example of a S.M.A.R.T. goal might look something like the following: WHAT My goal is to maintain a healthy body. WHY So that: I can be fit to do the things I enjoy. I can be an example to my children in health management. I can build my personal character strength. HOW Good Nutrition. I will increase my intake of fresh fruits and vegetables and decrease my intake of sugar, fats, salt and red meat. Physical. I will exercise aerobically 3 times a week for 30-minute periods.

Focus. I will be aware of my body and look out for any health problems. Focusing on the smaller, short-term goals and achieving success will give you the confidence to set other goals. So, remember, set your goals based on the S.M.A.R.T. principle to have the best chance of achieving your goals.

Ensure Good Returns on Your Investment: Follow the Saying, If it Doesnt Add Up, Dont Do It
By Brad Sugars Business is all about making a profit, so if your business strategies arent adding up to business profits, dont do it, or do it differently. To be a business that is, a commercial, profitable enterprise that works without you --your business must give a good return on investment plus a full wage for every hour you spend working in your business. You can then pay someone to do your job and the business profits are not affected. The quote if it doesnt add up, dont do it can be applied in all areas of your business. Advertising is a prime example. If an ad is run and does not get an immediate response, there is no point in keeping that ad running. It is wasting precious time and money. Change the ad or where it is running. Increasing your team must also add up in dollars. Perhaps a business should consider setting training and operating systems in place so juniors can be hired to follow the systems, rather than hiring seniors who have the head knowledge of how it should be done. Alternately perhaps the business should look at new machinery or technology instead of more team members. If you want to buy a business the figures also must add up or have the potential to do so. Make a list of the criteria the business must fill and make sure this list is filled before you commit yourself. Many people buy into something believing it would fulfill their needs, to discover the figures were inaccurate or did not add up. If you are not sure, get help. Two heads are better than one, and prevention is better than cure. A great idea when looking at a business is to check the industry average and see how your business compares. Given that four out of five businesses go broke in the first five years, you may want to be better than average. Finally the bottom line where your figures must add up is in net profit margin. To get this figure a business must add all expenses, including an appropriate wage for all the hours put in the business, plus interest on the capital you put into the business. This will give your real margins. If it doesnt add up, dont do it must be applied regularly. Dont wait until the end of the financial year to find if you have made a profit. Business is work, but it should also be fun.
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Leadership Whos Driving Your Business?


By Brad Sugars When business performance needs to be improved, it may well be wise to start the improvement process by first exploring the source of the leadership in that business. From my coaching experience I have found in many instances, that where a business is not performing, the leadership direction is unclear and is not understood by the team. Leadership is about painting a current picture of the future in the form of a vision. The common thing in all of the great leadership stories of the world is the ability to create that vision and then be able to share that vision with the people. Leadership is a powerful creative tool and when embraced by business owners, has immense impact on the success that can be obtained in that business. Managers in corporations have been guided by this concept for some time and for tomorrows leaders the following has been written. Every executive, every manager, to fulfill the role, must have a vision a vision of where the organization will be and what it will look like in the future. They must create that vision and then share it with those reporting to them, if they are to gain a high level of employee involvement and commitment and attain a high level of productivity. Anon So it is in business. To succeed, the business owner must paint the picture and be willing to share that vision with the team. It is from this beginning that so many success stories have evolved. It is in the absence of this beginning that so many businesses have failed. Who is driving your business? It is in this area of business development that the small to medium size business owner will be challenged when the future direction becomes unclear because of rapid and continual changes occurring within the market place and the speed of the change generated by the technological age that we live in. Excellence in the level of service demanded by the customer today increases as you meet the level of his expectations of yesterday. The need to continue to deliver to the market place, a product or service that is better today then it was yesterday, will challenge the visions that the leader will create and the team will receive. Low team moral, absenteeism and resignations are some signs that leadership has become engulfed and is in need of repair. Increasingly, business coaches are encountering business owners who seek the help necessary to refocus and to reignite the vision for success. With the guidance provided by the experienced coaches at ActionCOACH located throughout the world, many business owners are able to regain that leadership so vital for their success.

Making Business WorkSimply


By Brad Sugars There are some things in life that are supposed to be really complicated; being a parent, learning how to invest and running your own business. When you look at all of these things nothing could be further from the truth. Parents are taught by their children, investors are taught by their experiences and business owners should be taught by a mentor. Often when I look at businesses it is clear that the owners have given up trying to improve their lot in life because they think that it is too complicated an issue to generate more activity. They think they need to be Einstein to invent some radical new way of doing business. Let me give you a few real-life examples of how simple it can be to change the direction of a business. Usually a business has no coherent direction established within its culture. The first thing I seek to have the owner and their team do is spend some time deciding exactly where they want to be in 12 months time. This process must include all of the members of the business, because they will all contribute to getting there. Once this is done the goals are well publicized. One of our clients implemented this as the first step and this alone without any other changes produced a very significant increase in sales. Another business is a physiotherapy practice. Health professionals tend to think that they should not have to sell their services and skills; people should just discover them. The practices ActionCOACH wrote a simple script for the physiotherapists to tell their patients that it is in their best interests to come back regularly for treatment until the injury they had was completely cured. Up until then they would just say thanks for coming Ill see you later. This alone increased their number of patient visits from 190 per week to around 230a 21% increase in business. Next, the practice discovered that their patients were leaving their office, walking around the corner, and buying strapping tape, etc. from the local chemist. We stocked the practice with these products. Sales of these have substantially increased the cash flow. This business has grown by some 30% in ten weeks without implementing any of the more impactful strategies that we had identified in their initial analysis. In another of our mentoring businesses, we simply implemented a dress code for their sales team. The most dramatic impact of this came recently when their leading sales person had gone into the field in a dark blue shirt and tie. He spent six hours and had not made a single sale. He walked into a menswear shop, bought a white shirt and red/blue tie, he went to the dry cleaners and had it pressed and then he changed. Within 40 minutes of this change he had sold his entire inventory. There are many more examples of this sort. The message is clear. You dont need to be a rocket scientist to make money in business. Unfortunately most owners are so close to the coalface that they cannot see the opportunities. That is why an outside mentor who can give advice, encouragement, correction and discipline is the best investment a business owner can make.

How to Sell Price Focused Shoppers


By Brad Sugars The most common complaint we get today as business coaches to small to medium sized business owners is that, we cant compete with the big guys on price. The perception in the market place is that people are shopping on price alone. The only reason your customer asks the price up front is because that is what we as business owners have trained them to do. How many times have you rung or gone into a business not really knowing what model, style, color or features you were looking for and purely asked for the price? At this point did the sales person come back with that is $29.95 or did they ask you some questions about what you were looking to use the product/service for? In this instance lets say it is a kettle. Now in most peoples eyes a kettle is a kettle; but, they have many different features and offer many different benefits. So what if the sales person simply said to you when you inquired about price, just so I can help you best is it okay if I ask you a couple of questions about the kettle you are looking for? Would you have answered yes? My bet is that the answer would have most definitely been yes! The sales person could then ask questions like; are you looking to replace an existing kettle or is it a gift for someone? Do you regularly use your kettle or is it rarely used? Would you like a kettle with a quick boiling time? Have you seen the cordless options that are available? Are you looking for something to match your kitchen? So what color are you looking for? Is it important that it has an automatic cut off when the kettle is boiled? Are you after a stove-top option, or an electric kettle? Kettles come in different cup capacity; do you require 10 cup capacity or is 5 a better size for you? From these questions the customer gets the idea that the sales person is genuinely interested in their needs and the salesperson is able to offer options in the most suitable kettles for their needs. The price is therefore negated. It is just a matter of now asking the customer to buy. A good salesperson would then ask, well based on what we have just spoken about there are two options to choose from, model x and model y, which one suits you best? Great, I can either put that away for now or I can process it on credit card for you and have it delivered to you tomorrow which do you prefer? If the option is credit card ask which credit card is it easiest to process that on? and make sure the prospect is aware there will be a delivery charge of x amount. If the option they choose is to have it put away, this gives the sales person the opportunity to get the customers name and contact details. If the customer chooses this option make sure the sales person gets a time frame for them to pick the item up. Be definite with the infinite. If the customer is in your business the sales person then simply takes them to the point of sale terminal and transacts the sale.

This example was based on a kettle, a relatively small dollar item. How does this apply to your business? This process works equally well on cars, houses, furniture, service based businesses and any other product I can think of, including funeral homes. You just need to work out what your customers are actually looking for when they ask for the price, and whats most important to them in their buying decision! ActionCOACH is a business coaching and training company that works with small to medium sized business educating the business owner how to improve the sales and marketing in their business.

The Power of Priorities


By Brad Sugars There are two things that business people find very challenging: thinking ahead and doing things in order of importance. Doing these two things makes the difference between success in business and just surviving. And the same is true for all areas of our lives. Leadership trainer and author John Maxwell says, thinking ahead and prioritizing responsibilities marks the major differences between a leader and a follower. Most people have heard of the Pareto Principle, more commonly known as the 80/20 Principle. Roughly stated this says that in most businesses 80% of your business comes from 20 % of your customers. Other examples of the Pareto Principle are: Reading: 20 percent of the book contains 80 percent of the content. Job: 20 percent of our work gives us 80 percent of our satisfaction. Products: 20 percent of the products bring in 80 percent of the profits. Picnic: 20 percent of the people will eat 80 percent of the food! So when it comes to your priorities, 20 percent of your priorities will give you 80 percent of your production IF you spend your time, energy, money and personnel on the top 20 percent of your priorities. When you do this you are getting a 400% or fourfold return in productivity. Think what this would mean in your business!

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Every business person needs to understand the Pareto Principle as it applies to the areas of customers, team and leadership. In the area of customers, it is vital to identify the 20 percent who account for 80 percent of your business. These are your raving fans and strategies must be put in place to care for them appropriately. For your team, you must identify the top 20 percent producers. Spend 80 percent of your people time with these people to develop them to their full potential. In leadership, take an honest look at the question What do I have to do that no one else can do? Remember a leader can give up everything except final responsibility. You can decide whether you will be reactive or proactive when it comes to the use of your time. The question is not, Will I be busy? but How will I invest my time? Its not Will my calendar be full?, but Who will fill my calendar?, Its not Will I see people?, but Who will I see? Do this and watch your productivity and personal satisfaction rise to new heights!

The Steps to Successful Sales


By Brad Sugars Avoid the sales peaks and troughs experienced by the average salesperson by building an individual selling system that will guarantee you results Goals Without clearly defined goals, measured over a specific time frame, you will achieve very little. When setting your goals consider your income, lifestyle and requirements. First, aim to improve your last years income by a specific amount, or, if you are new to sales, aim to achieve as close to the top sales person in your team as you can. Prospecting The level of success achieved by salespeople will always be determined by the number of customers self generated, that is other than floor traffic or telephone enquiries generated by your advertising. Put a system in place to regularly find new customers from referrals, past customers etc. Build up your database of loyal customers that you can sell time after time. Qualifying

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Qualifying is the factor, which has the greatest impact on the management of your time. You have to become skilled in sorting prospects. The greatest stress in your career will come from working with unqualified prospects, be it someone who refuses to buy at a fantastic price or someone who is not ready, willing and able to buy at all. The Sales Process The key to a successful sale is the ability to build rapport and trust with each customer. Meet, greet and build rapport, settle them on a model, garment or product to demonstrate. All the time check by asking trial closing questions, then ask for their business. Remember to sell the benefits of your product speaking in their own linguistic modality. For example, talking to an auditory person about a car engine you would say: Listen to that engine, doesnt it sound great? or to a visual person your could say, You see how smooth that engine is Follow up This is the first step to the next sale to your customer or to obtaining referrals from them First a thank you letter, then a 7 day follow up call followed by a call at least every 9 days. This will ensure a steady stream of referrals All you have to do is ask. Remember Do what you most fear to do, and you will have the results you most want to have

People Plus Systems Equals Great Sales


By Brad Sugars When you ask many of the greatest salespeople in history what their secret is many would answer personality. But when asked how to quantify and teach personality to others, these super salespeople are often stumped. Teaching great sales involves a major re-education and a focus on systems that make sales simple. Sales scripts not only increase the sales of top performers but also produce amazing results for the entire team. One rule of thumb, which can be used in selling and in life, is that what you can measure you can manage and grow! The ultimate test of a superior salesperson is how consistent their results are and how consistent the results are for the entire team. Using a sales script achieves this consistency and makes the training of new team members simple and effective. By introducing a sales system like a script, you can then measure conversion on a daily basis and your sales will automatically increase guaranteed. So, exactly what does a sales script look like, how do you write one and how is it used? Lets look at this now.

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A sales script is a documented, methodical, learnable, effective system of selling your goods and services. It is a written process on paper designed to give the salesperson control of the call (while the customer feels in control) and create a desired result the sale! It is written by your number one salesperson, in answer to the question Exactly what do you say to a prospect to get them to buy your product? You may even choose to reward your top salesperson for doing this by offering them a great incentive such as a percentage of extra sales. Let us briefly outline key parts of the ActionCOACH sales script. Obviously, there are differences between sales scripts used on incoming and outgoing calls; however, I will just detail some of the universally used key ActionCOACH selling lines taken directly from our sales scripts! The opening: Could I just outline the reason for my call? Permission: Would if be okay if we go through the call that way? Rapport Building : Whats your biggest challenge right now in that area? Below Waterline: What's most important to you in Paraphrase: Based on what you just told me, it sounds like Temperature Check: How does that fit with what you had in mind? Secure the Sale: Would it be okay if I give you the steps in getting that process under way? Conclude the Encounter: Congratulations and bye for now. A script can be read, learned and must be practiced, used, measured and improved (if needed) to increase conversion rate of prospects to customers of all the team. Imagine taking the guess-work out of selling once and for all by using a system which makes your sales results less people dependant and more system dependant! ActionCOACH is a business coaching and training company that works with small to medium sized business educating the business owner how to improve the sales and marketing in their business.

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How to Use Scripts to Ensure Consistency in Customer Service


By Brad Sugars Is your first reaction like that of my clients - scripting doesnt work, scripting is too artificial, scripting doesnt take into account different personalities? Ive heard just about every excuse as to why scripts wont work; but, as I wean my clients onto the idea and they see their bottom line increasing, converts are made. Heres how to get started. The four main areas to consider when writing a script are:

Target Market be very clear who youre trying to reach. Process some of the more expensive products and services may require several steps before a sale is made. Urgency you must give people a reason to act now. You Focus your script needs to be focused towards the customer.

Within the script itself you then need to look at:


Greeting Get this right as it will set the tone for what follows. Outline the reason for your call/visit and get permission to continue e.g. Would it be OK if I outlined the reason for my call today? This step applies when youre the one making the first contact. Ask open-ended questions you must ask questions that cant be answered by yes or no.

d) Get agreement - you need to get feedback from the customer. Ask rhetorical questions that will get them to say yes - e.g. So it sounds like youd benefit from A, B and C, thats pretty good, isnt it? e) Deal with objections this is part of the process! Get the customer to elaborate, acknowledge that what theyre saying is true for them at the time and then come up with your standard replies to known objections. f) Close and take the next step Would you like to pay by check or credit card? g) Use transition phrases/temperature checking phrases like, How does this fit with what you had in mind?, So from what I understand, you want A, B and C. Is there anything else?
You will end up with a script that is really effective as a sales tool. More importantly, your entire team will have a framework to follow, which means your customers will be treated in a like-minded fashion regardless of who speaks to them. This, in turn, enhances the perception of excellent customer service. An added bonus, if you needed another one, is that any new team member will be productive much more quickly. Go make it happen! 14

Increase your profits, measure your results I hate accounting but I Love tracking and measuring the responses to my ads. When a friend saw my tracking system, he claimed I was a frustrated accountant. (Since he was an accountant, I took it as a compliment.) The only difference today is that theyre kept by computer rather than by hand and theyre more detailed. To tell whether your ad made a profit, you have to compare the profit on your sales from the ad (gross revenue, less the cost of the product and marginal costs like credit card commissions, postage, and so forth) to the cost of running the ad (including an allocation of the costs of creating and laying out the ad). (You may also want to include the cost of the product or service, as I have done in these examples. Ill discuss this under Rule #3.) The other important feature of the %B/E column is that it allows instant, bottom line comparison between different ads and offers. It summarizes your return on investment and takes out all the differences, like different media costs. Consider the two sets of results I have show you here. Both ads were for the same product, a special Report I wrote called How to get a second Passport. They both ran in the same publication, The South China Morning Post (so the records are kept in Hong Kong dollars HK$1 = US$7.8 if you want to make any conversions). However, they ran a year apart, but the second ad results on page 7 did better (372% of break-even compared to 286%) even though the second insertion cost more that the first; and despite the second offer in the first ad for a one-year subscription to my investment newsletter, World Money Analyst. And since Id run this ad many times in that year, you would expect a fall-off in response you would expect the second ad to do worse. One reason is the position of the ad the first as was run of paper which meant the ad manager could put it anywhere he liked. The second ad was on the first page of the Business News section of the Post. A far better position (see rule #5). But without a premium or loading for that position (rule #7). When you can have an unlimited ad budget When you are over 100% of break-even, what happens to your advertising budget? It becomes unlimited (with that offer in that medium, of course).

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When your ad is aimed to generate enquiries, you need to calculate two key indicators:

The cost per enquiry (number of enquirers divided by the cost of the ad); and, The conversion rate (the percentage of enquiries that buy) plus, of course, the ultimate profit.

Once you know your conversion rate, you can project the profitability of your ad simply from the number of enquiries you have received. For example, lets say your profit per sale is $25. If your cost-per-enquiry is $5, your conversion rate must be 20% to break even. But if your average conversion rate is only 10%, you will know that this ad, in this publication isnt going to work. But if your new ad produces a cost-per-enquiry of only $1, the ultimate profit-per-enquiry (with the same 10% conversion rate) will be $2.50, and you will know you will want to run this ad again. If this is new to you, you will be wondering how to trace a specific sale to a specific ad. The answer is: Rule #2

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