Every business, no matter how big or small, needs a magic number.
That magic number acts as the beacon so you know you are heading in the right direction.
It helps keep you focused and provides momentum.
So what’s the magic number? It’s your revenue target for your year. Or if you are more of a purist, it’s your annual profit target.
Let me tell you a story
Let me introduce you to one of my clients…let’s call him Fred.
Fred’s business is a good size and has 5+ sales/account managers who generate the majority of the revenue. Fred was concerned his sales had tailed off a bit.
I asked Fred what his magic number was and he replied… “as much as possible”.
Now on the face of it that may seem like a reasonable response, and to a certain extent all business owners strive to achieve “as much as possible”, but there is a downside to this approach which Fred’s sales team exemplified beautifully.
I talked some more with Fred and discovered his sales team didn’t have targets.
I then talked to his sales team. I asked them if they had their own version of a “magic number” they wanted to individually hit. The answer was “No”.
I then shared with them Fred’s answer of “as much as possible” and one of the sales team replied “well in that case we are the best sales team ever as we are doing “as much as possible”.
The Challenge
And there lies the challenge…if you don’t have a clearly defined target you can’t strive towards it. In this specific case, you can’t convey it to your team so they don’t understand the scale of the job. You can’t plan your marketing as you don’t know how many leads you need to generate. You can’t celebrate overall success as you can never achieve it.
What’s even worse is that your brain won’t kick into gear to accomplish it.
It tends to follow that if you don’t have a magic number you also don’t tend to track your sales activity, revenue or profit numbers.
Do you? Do you know your magic number? Do you track your revenue?
Do you want to grow your business?
Growth starts with knowing exactly where you are now, and knowing where you want to get to. When you can define that gap you can take the necessary action to close it.
If you don’t know your magic number, you won’t know your gap and you are likely to feel dissatisfied with your progress.
This would be like wanting to climb a significant mountain, but not choosing which one and just guessing at the amount of supplies you take with you. You are likely to get somewhere but highly unlikely to achieve the success you were after.
The Solution
Choose your mountain, pack your supplies, chart your course and get to it!! (aka state your magic number, understand the gap you need to close, build your marketing plan and take action!).
The fundamental piece to remember is to update your progress so you continually know the size of the gap and the amount of effort required. Otherwise you’ll go off-course and lose momentum very quickly.
The Cost
Doing this will take you a few minutes and can help you put plenty of money in the bank.
Ignoring this can cost you a significant amount of time and money.
As Nike say “Just do it!”.
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