Want to double your profits? Work the levers.

Want to double your profits? Work the levers.

I admit it, I listen to a lot of podcasts. They’re like mind-candy to me – always something new to learn. I stumbled across one recently that I’ve been thinking about ever since. It’s called The Seven Levers of Business.

 Pete Williams and Dominic Goucher talk about the Seven Levers of Business — seven areas of any business that can be improved to provide growth. Using a systematic approach in each area could almost double your profits in less than a year.

The 7 Levers of Business are…

1. TRAFFIC: Every person that visits your website, walks into your store or calls your business for information adds to traffic. These are first-time visitors.

2. OPT-INS: Individuals within your traffic who take a step that moves them one step closer to buying. On a website, it refers to people who register their email address through a lead capture form or who forward your newsletter/blog to a friend. In a store it’s someone who tries on an item of clothing. In a manufacturing company it’s someone who sends you a quote.

3. CONVERSIONS: This is the percentage of your “opt-ins” who commit to spending money with you.

4. ITEMS PER SALE: Nice simple one – this is the average number of items purchased by each customer.

5. AVERAGE ITEM VALUE: To get this figure, divide the total value of all the items sold in a given period by the total number of items sold in that same period.

6. TRANSACTIONS PER CUSTOMER: On average, how often do customers make repeat purchases?

7. PROFIT MARGIN: After subtracting the cost of making the sale, what is the average profit margin of each sale (as a percentage)?

The 7 Levers system developed by Pete Williams and Dominic Goucher. Click here to listen to the 7 Levers Podcast. There’s even a 7 Levers Calculator to help you work your way to greater profitability.

 

“If you don’t decide what your life is about, it defaults to what you spend your days doing.”
– Robert Brault

Leave a Reply