Organic Sales Growth

Friday, September 6 2013

Organic business growth happens without dramatic measures such as buying a competitor, changing suppliers, or entering a new market.

Such major interventions require significant capital and human resource investments well in advance of any return. Organic growth emerges naturally, expanding upon existing customers, products or services. Like farming, it attempts to get the best return on the investment of existing assets.

Your company can grow organically and sustainably by making relatively inexpensive tweaks in your business. Let’s review five strategies that you can implement immediately.

1.     Increase the number of sales per salesperson.

If every salesperson increased year-over-year sales modestly, by 5-10%, it will likely cost little more than a commensurate increase in commissions. Your overhead, salaries, and warehouse costs will hardly be impacted. Most of the margin on those sales will go straight to your bottom line. A good sales course will help you accomplish this and more.

2.     Increase the number of products or services purchased per customer.

This may be a simple correlation to the previous strategy – more sales per salesperson could be achieved through more sales per customer, or it could happen through better customer service, special offers, more direct marketing, better literature that explains additional options, or smarter social media marketing that encourages more frequent purchases.

3.     Enhance the size of sale per purchase.

Accomplish growth by marketing or prospecting to a ‘bigger’ buyer. If your average size sale is currently $1,000, are there other buyers who need a bigger, better, more sophisticated, interesting, convenient, reliable, guaranteed, flexible product that is worth $1,500? This strategy represents an internal shift in thinking that focuses your attention rather than one that will cost more money.

4.     Boost the profit margin per product sold.

Can you negotiate a better price with your supplier if you promise to sell more? Can you increase your price slightly without giving anything else away? Can you reduce your cost of sales using more phone calls and email versus on-site visits? What about webinars instead of lunch meetings?

5.     Target add-on sales that naturally complement existing sales.

There are so many examples of natural complements – sell a shirt, tie, belt and shoes to go with the suit. Undercoating, fancy floor mats, upgraded sound system, Bluetooth connections, and GPS go nicely with a new car. What add-on complementary products or services go naturally with your product?

At a time when businesses are cautiously optimistic about the economy and the future, planned organic growth offers a safer, more sustainable bet than highly disruptive approaches that bet the farm.