5 Ways - #4: Average Dollar Sale
We’re talking about the 5 Ways to massively increase profits.?Let's go into the fourth one, the Average Dollar of Sale. Average dollar of sales is really an interesting thing. At ActionCOACH we have we have over 58 different strategies to improve the average dollar sale. Things like creating bulk buy deals, gift with $ purchase, and educating clients on value instead of price.
In fact, when you're working with us, one of the first things we are going to do is help you define what your unique selling proposition is. What value are you bringing to your customers and your clients? Because as soon as we can identify what is unique about your business, you can then promote your business based on that value instead of price.
If you own a tree cutting service and someone calls you and says, ‘Hey, I have a tree I have to get rid of, how much is that going to cost?’ And you tell them it's going to be $1,000. What is their response??‘Okay. Thank you.’ Before they hang up and call the next tree cutting company.?Because what is that client going to use to determine which tree cutting service they will hire? They're going to be looking solely at your price because that's the only bit of information they have.
So instead, when the client calls your tree cutting service and says, ‘Hey, I need to get rid of a tree.?How much is that going to cost?’, you are the subject matter expert. And you need to express that to the client. ?Instead of just quoting a price, you’ll ask questions...?
‘Okay, what size of tree are we talking about? What type of tree? Do you know? If not, can you send me a picture of it? Send me a picture of its leaf. I can then tell you what type of tree it is. Whether it is a hardwood or a softwood tree will affect the price. Are there any power lines in the area or does the tree hang over any roofs or other structures? Are you looking to get rid of the tree, really? Or are there branches hanging over your house and you want to protect your home? What's the actual problem we're solving? Because I don't want to destroy an entire tree if really there's a different problem that can be solved in a different way.?Because that might be more cost effective for you. So, I want to bring that value.’
As soon as the business owner can start communicating the value of what they offer, then they are not going to be competing on price. And I went very specific because one of the first things that we talk about at ActionCOACH is how to identify your value, communicate your value, and then sell based on that value. And you can probably raise your prices. You're no longer competing on price. And by raising your prices, that improves your bottom line.?It's actually a twofer. It improves your average dollar sale and it improves another one of the 5 Ways, the profit margin, both at the same time. ??
Quite often, business owners are concerned about raising their prices.?However, if you question their customers and clients, price really isn’t the biggest issue for them.?So, they don't change their mind based on price. Think about businesses you go to even thought they don’t have the lowest price.?According to studies, over 90% of clients aren't going to change their mind based on price. There are also other ways to improve your average dollar sale.
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Let’s take McDonald's as an example. When they started asking customers, ‘Do you want fries with that?’ their sales increased by millions of dollars. Same thing when they began to ask, ‘Do you want to supersize that?’ Again, millions and millions of dollars just by directing employees to say one line.
ActionCOACH had a client who was a lawyer. They were looking at increasing their average dollar sales. And their solution turned out to be the person they have at the front desk. Any time somebody came in, he or she was directed to ask the simple question, ‘Have you updated your will recently?’ And almost always the answer was no. And the law firm made over $1,000,000 that year based on that one question alone!
So, can you increase the average dollar of sale? Absolutely. Like I said, we have many, many strategies that can work. By using simple strategies, it is possible to increase your average dollar sale by 10%. And the reason I say that specific number is we focus on small incremental changes on all five of the 5 Ways. If you make a 10% change in each of the five ways, then your bottom line, your profit will increase 61%. ?
If you’d like to learn more about the?5 Ways?and how they can?significantly?improve your business and increase profits,?schedule a free coaching strategy session.??