“I have a gym, there is a lot of competition in the area and despite having the lowest prices and a good atmosphere I cannot increase the number of clients, I would appreciate any recommendation since nobody talks about this business, thank you very much.” – Ricardo
“My sales have dropped a lot to all the tenants, the customers who buy are less and less, but if there is an influx of people, I have excellent saleswomen” – Felipe
“My dad owns a tortilleria but lately the sales have dropped too much, he had deliveries in grocery stores and they canceled them. And there is a lot of competition near your business. What could we do to improve sales?“- I’m Letty, from Mexico.
Help messages like these are sent to me frequently and it is not for less because one of the common concerns that every entrepreneur experiences sooner or later is the low sales or lack of customers, which somehow amounts to the same.
Building a business is a great adventure that can give you enormous satisfaction but at the same time requires a lot of skill and tenacity to maintain it and make it grow. However, lack of experience can at times make us feel confident and realize that things are not going well until we see the effects of the crisis in our pockets.
The good news is that in most cases, there are practical solutions that can correct the problem. Some of which I will comment on in this post. Of course, as long as you can detect early enough that you have a problem and take decisive action to correct the course immediately.
The worst thing that can happen to an entrepreneur is to see that his business is in trouble and naively presume that they will fix themselves over time. Which only happens a small percentage of the time.
So that,what to do if your sales have dropped?, ¿how to build your business? How to proceed if the crisis has led you to a desperate situation? These are some tips.
Act with your head, not by impulse
The first mistake you can make when you find yourself in a crisis in your company is to start taking action impulsively. Many owners or managers begin to cut costs dramatically, cut staff, minimize advertising, or think of extremes like close the company and find a job.
Contrary to this, it is best to act with your head. Stop calmly and begin to investigate and analyze which may be the possible causes that your business is not obtaining the desired income. Take into account that the factors can be many and if you do not try to technically determine what may be happening, you will most likely end up rowing against the current and taking your business nowhere.
Try to determine the causes
A business could go into crisis and lose customers for a variety of reasons. Some of the most common can be:
Your competition. It may be that your competition is acting aggressive or disloyal. Whatever the cause, they may be staying with your potential customers. You must do a market study immediately using a mystery customer service to find out what they may be doing or offering better than you. There is also the possibility that the number of competitors has increased. Maybe the business is so good that everyone wants to earn some money and you are fighting a natural phenomenon without being properly prepared.
Your prices. Your pricing policy may not be the most appropriate. Sometimes selling high or selling low is a dilemma that must be solved technically and realistically. You must ask yourself if your prices are in line with the market segment you are reaching. It may be that your product or service is of excellent quality and worth its price, except that customers in your area cannot afford it and prefer to find cheaper options.
Your target market. Another of the most common reasons why a business does not take off financially is because it is oriented to the wrong market. You must have the ability to clearly define the profile of your customer and then know if you are really attracting said customer with your products, prices, promotions and advertising message. Imagine that you are selling expensive accessories for women from well-known brands in a middle-class commercial. You’re probably off the market.
Lack of a sales strategy. Many entrepreneurs don’t have the sales results they want for the simple fact that they never planned with a strategy. They opened the doors of their business waiting for customers to come and buy from them, which is increasingly difficult at this time. Others, in their eagerness to reduce some costs, try to do the sales work without having the appropriate aptitudes for it with the consequent low results. Therefore, to sell you need good salespeople and a strategy that includes the means of promoting your products, your brand and your business in general.
Costs too high. Some businesses fall into crisis not because they are not selling but because their operating costs are extremely high. There is no use selling $ 10,000 if your business works with $ 9,500. In any case, it would be better to sell $ 8000, if your business works with $ 5500. Thus, a corrective action is to consciously analyze your costs and determine the appropriate actions to take to improve the enormous administrative or productive burden of your company.
Internal leaks or losses. Another common cause that leads companies to difficult situations is internal losses. There are several ways. For example, it could be that your lack of controls leads your employees (cashiers, vendors or winemakers) to fall into corruption and keep a good part of your sales, without you noticing. The internal security of your company is very important to reduce these leaks. Ant or excessive expenses are another reason why your profits could be disappearing.
Bad customer service. Even if it seems like common sense, many entrepreneurs neglect the service they provide to their customers to the extreme of losing them. Today, we are in an age where customers have a thousand options to choose from. And if we don’t treat them well, the chances are they won’t come back. So if your collaborators are not trained to have an excellent customer service culture and they are not clear that the client pays their salaries, it will surely be difficult to leave or not fall into a low sales crisis.
Informality in the processes. The sale is a process that begins with a good quote, continues with great attention, a good product, an excellent price, delivery and an after-sales process that builds customer loyalty and allows us not only to keep it but also to refer us to other customers potentials. If your sales are down or your business is in crisis, it is likely that your processes are suffering from one of these deficiencies. Slow deliveries, quotes with vague information, ineffective sellers, inadequate warranty policies, etc.
As you can see, when sales go down it doesn’t just mean that “something weird is happening.” There are many factors and in fact, the ups and downs in the economy or the different seasons of the year could also affect your business naturally. And even for these external factors it is convenient to have a plan that allows you to stay afloat.
The important thing, however, is not to sit idly by, or blindly lashing out at everything and everyone who is part of your business as if wishing that things would improve. The best thing to do is to brainstorm, ask employees, customers and suppliers what their appreciation of this is and what they consider to be the weak points. And for sure, you will discover amazing answers that you do not see with the naked eye.
What other factors do you think can help improve sales?
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