User login

Cutting Costs to Keep More Cash

(August 2008) posted on Wed Aug 13, 2008

Trimingham describes how creatively reducing expenses can allow you to earn more in the long run and keep your valuable workforce on the payroll.


By Tom Trimingham

click an image below to view slideshow

2. Redirect 40% of the funds budgeted for lead generation into direct-response mailers or newspaper inserts with a very strong response component (percentage off, free shirts, etc.) to drive leads with a traceable element.

3. Develop a VIP referral program using 30% of the funds with a traceable card and really cool awards (like a Nintendo Wii) that would motivate referrals.

4. Create a simple Website that could be used for searches instead of the phone book with 20% of remaining budget.

5. Save the remainder of the budget.

 

Lead conversion

Properly cutting costs in lead conversion was a touchy area at XYZ, because the sales force had a set method in how to deal with the sales process. As such, the company found it necessary to conduct a short review of three areas:

1. Total time/costs invested with clients before sales were closed.

2. Cross reference this information with the different level of each sale--1 being low level, 2 being moderate ($500+), and 3 being high ($1000+).

3. Balance any pattern of time/cost investment against the level of sale, and consider the art component at this point (investments of art time, spec art costs, and revisions prior to closing the sale).

 

This review quickly showed what you might expect. There was no pattern that regulated the time/cost vs. the level of a sale. The important conclusion at this point was that it was not inconsiderate to quickly qualify clients’ orders (and the potential of future business) to a certain level of sales service at the very beginning of the process. Failure to qualify sales service can be very expensive.


Terms:

Did you enjoy this article? Click here to subscribe to the magazine.