by Affiliate on May 27, 2010
An online business is no different than a bricks-and-mortar operation in terms of business trends. There are going to be periods of high sales along with slumps, this is just the way business naturally happens. Unless you are a household brand name, you cannot expect sales to be good every month or every quarter of the year.
The key to staying in business is to take proactive steps by controlling cash flow during those sales slumps.
Identifying Sales Trends
If you have been in business for less than a year, you may find it difficult to forecast sales trends – but it is not impossible. Go back to your marketing plan and review your competitive survey. What do competing companies show as far as seasonal trends?
A forecast should also be part of your overall business plan. While you may have projected annual figures for your company’s profit potential, try breaking that number down into month-by-month figures. Create a graph from your monthly forecast and it will clearly show the high points and low dips in expected accounts receivables.
Controlling Cash Flow – Planning For The Dips
Once you have identified where those sales slumps are going to occur, it’s time to take proactive steps of controlling cash flow to ensure you can make it through the tough times.
The truth is that in order to make money, you are going to have to spend money. There’s just no way around it. And when you are making the most money, you are also probably spending the most. This makes it hard to set aside funds but there are some best practises that will help saving become a possibility.
Schedule payments for capital investments or necessary services to coincide with periods of heavy sales. For instance, pay your bill for internet access several months in advance so that you don’t have to worry about this cash outlay when you can least afford it.
If you have employees in your business, see if you can work with them on a contract basis. When it’s difficult to pay your bills, the last thing you can afford to do is pay an employee who is not contributing to your company’s bottom line.
Consider pausing or downsizing online advertising campaigns during slow periods and don’t take on new ventures in terms of spend but do take downtime to plan ahead by preparing content and research material for the busier seasons. Internet marketing and advertising is always important, but it is an extra expense when you are having a tough time paying those bills essential to your operation. Focus on lower-cost promotional techniques rather than expensive campaigns, unless you know you have established ROI.
Of course the best way to plan in advance for dips in cash flow is to do what you can to increase sales. Plan promotions, sales, discounts, and special events to coincide with those periods when you need income the most. This should help smooth out that chart of sales levels you used for forecasting.
The most important thing you can do to stay in business is to be proactive about making it through the lean times by controlling cash flow. The majority of new companies close their doors (both literally and figuratively) due to lack of proper financing. Ensure that you don’t fall into the same trap and set aside as much cash as possible.
Year Of The Affiliate
YOTA Internet Marketing Forum
SeoZodiac.com © 2009 - 2010
by Affiliate on May 6, 2010
Does it help your internet marketing efforts to hold a fire sale on your products or services? It certainly could. Learn how to hold an online fire sale and what benefits it provides.
The Basics Of A Fire Sale
Bricks and mortar retailers have been using the concept of a fire sale to stimulate buyers for decades. You may have seen store windows splashed with big, showy signs proclaiming a one or two day sale with prices slashed on particular products.
In some cases, the fire sale price is so low that the seller makes little profit, or even takes a loss. The idea is to increase demand for a particular offering in the hopes that a customer who gets a fantastic deal will add other products to their shopping cart and come back in the future to do business with the company again – when that low price is no longer available. This increases profitability over the long run. This is also a great idea for gaining new subscribers just before a new product launch.
Expect that initial demand is going to be very high. Ensure that you have enough goods in stock to handle the demand. If you only have five mp3 players at the fire sale price, for instance, and those sell out within the first hour, the effect will be a negative one. Consumers will surmise that you are using the old ‘bait and switch’ technique.
This isn’t going to be a problem if you’re selling an information product or membership so that’s something to keep in mind when deciding on what to sell in your fire sale. The products you can sell at fire sale prices can be anything from a download of an eBook to a webinar; they need not be traditional consumables.
The Successful Online Fire Sale
An online fire sale uses the same concepts as one held by a traditional retailer. Perhaps the only difference is that your advertising and marketing efforts revolve around banner ads, a catchy graphic on your site’s home page, and an email marketing campaign to your subscribers.
The success of a fire sale depends largely on the degree of interest from subscribers and how deeply you can reach prospective clients through your marketing efforts. While these factors are somewhat uncontrollable, there are some things you can do to promote success.
Select your deeply discounted product or service with care. If you choose an item that previously wasn’t selling, there’s probably a reason and even taking a loss on the purchase price probably won’t help. Do choose something that is already fairly popular and attempt to increase demand. Remember that it is your ‘loss leader’ and use suggested add-ons with a pop-up box in the shopping cart to increase each customer’s order.
It is vital that you begin advertising well in advance of the sale – but not too far in advance. A week or two is probably sufficient. Be sure to post notice on your blog, on your home page, and to send out a succession of email messages to all of your subscribers. Start with a teaser about the event about two weeks out, then send an official notice with all the details a week later. Two days before the fire sale, send your final reminder. You could also send another message on the day of the sale to invoke a sense of urgency.
A online fire sale is a great way to increase your company’s bottom line though getting more customers, or to help you unload excess inventory. It develops further interest in prospective clients and is sure to augment future sales while creating buzz and driving traffic to your website.
Year Of The Affiliate
YOTA Internet Marketing Forum
SeoZodiac.com © 2009 - 2010
