Category Archives: Sales
How to Increase Sales without Advertising?
There are three simple but effective principles that need to be followed in small businesses in order to increase your sales without any money spent on advertising.
Choose Best Strategy
There are many businesses in the world that don’t have any decisive competitive strategy or edge. However, these businesses are surviving in the current environment with a lot of ups and downs.
A decisive competitive strategy is one that differentiates you from your competitors. Here is an example.
You would have experienced many times in negotiating the purchase price of clothes when it is brought from the street vendors. At the same time, you would have also experienced in the retail shops paying the exact price without any negotiation for branded clothes.
Because we believe that street vendors offer low-quality products at a higher cost and the famous retail shops offering the best quality product at a higher cost.
The only difference between the two is establishing their brand as a strategy for business. If you want to read more about identifying strategies for your business, please read my post ‘how to set a business strategy for small businesses?’
Turning customers into the salespeople
“If you do build a great experience, customers tell each other about that. Word of mouth is very powerful.” – Jeff Bazos –Amazon
As a thumb rule, a satisfied customer refers your business to at least five people in his or her lifetime. But a delighted customer reaches out to many people in his life and acting as unpaid salespeople for your business.
You would have recommended at least a restaurant to your colleagues, friends, relatives, and neighbors in your life, just because, that restaurant treated you with tasty foods or uncompromised service or with superior hospitality. By now, you become an ambassador for their business unknowingly.
So, remember – The best ever strategy is ‘customer satisfaction’.
Put Service First
If you think business is nothing but earning more money, then you will be soon out of business. Because the aim of any business is to providing value to the people and improve their life a little better than before with your product or services. The money is nothing but an outcome of the value provided to them.
As an entrepreneur, your focus should be on improving the value of your product and processes consistently to provide the best possible service to the customers. nothing else!
“Put service first, and money takes care of itself” – David J. Schwartz
If you would like to read more about identifying values in your business, please read here.
I am sure that by following the above principles your sales will increase exponentially without any money spent on advertising.
How to Understand Sales Pattern in Retail Business?
It is difficult to make predictions, especially about the future. – NEILS BOHR, Danish physicist
What is Sales Pattern?
The sales pattern is a collection of data about the sale of a particular product or group of products in the business for a given period and displaying it graphically to understand it’s behavior. These sales patterns are used in retail businesses to identify whether the business goals are being met, the effect of price changes of a particular product impacts sales, sales response to advertising, etc.
Understanding the sales pattern in retail business always helps to correlate the sales variations with respect to the various events happening in and around the business every day. The continuous monitoring of the sales pattern would certainly help the retail business to foresee the upcoming risks and take precautions.
By just looking at the numbers one cannot decide whether the low sale caused by a natural event or special event. Natural events are inherited in business as these causes cannot be removed. It is always going to be. For example, every day sales will have some variation, which cannot be controlled. But, some events would externally impact the sale. For example, the absence of employees, sudden power supply failure, holidays, etc.
Special events need attention and the actions to be taken immediately for these events to avoid recurrence. When these variations are studied using a statistical tool called ‘control chart’, we can differentiate special and natural events clearly.
Understanding Sales Pattern
Let us take an example of a fruit seller. The seller wants to identify whether his sales pattern in retail business follows normal special events. He has a sales record for the last 3 months for our analysis. The below-mentioned data provides the sales summary for 15 days which is taken as a sample from the whole set of data for representation purposes.
There are many types of control charts available. The most relevant control chart for this analysis is the Individual Moving Range (I-MR) Chart. To understand the selection guide, calculation, and interpretation of the control chart, I would recommend you reading further by clicking here.
The above figure shows how the control chart would look like for the given sales data.
The top line graph is an individual chart that represents the sales trend for individual value. Its centerline indicates the mean value of sales (Rs. 7749) which means the complete sales value for the 15 days lies around this mean value with the variations. These variations are from maximum value Rs. 10,415 to a minimum up Rs. 5,083.
These values are drawn as an upper control and lower control lines.
Any values lying between these lines indicate that the sale value has normal variations around the mean.
Now, let us look at the second graph which is a moving range (MR) chart. This chart is plotted with the difference in the sales value of the previous day and current day. The upper and lower lines give the control limits of the values which are calculated using formulae.
By looking at the chart, you can understand that the sales value between 10 Nov and 11 Nov has a huge difference and it almost reaching to the lower control limit. Though the limits outside the control line call for an action, it is advisable to understand why the sales variation is more during the above-mentioned days.
The fruit seller should be advised to identify the reasons for this variation and prepare himself for the future.
MR-chart is useful to understand the process variability with smaller samples and individual data. The understanding of this statistical tool would help a retailer in knowing the external impacts of a business and help him to take correct decisions.