The Importance of Customers! (by Dan Hammer, Chicago Illinois)
I hope you had a wonderful 4th of July. For those who live in America yesterday was our country’s 235th birthday. I want to personally thank Rev. Meiam Coleman who served in our Armed Forces. He, and thousands of others just like him, have helped insure the freedoms we enjoy here is the USA. If there are any other service members who I left out, then please let me know so that I can personally thank you and acknowledge you for your service to our country.
Part of the beauty of America is our ability to be self-employed. It is both a risk and a reward. So, how to you minimize the risk and maximize the reward? It all centers on two key items:
- Lower your costs to operate.
- Attract customers.
Cost control and customers are key to any business and your Synergy business is no different. Here’s just a small comparison. At one time I owned and operated three health clubs in the Western suburbs of Chicago. Here are two expense categories for comparison with a Synergy business:
|Monthly Rent||$31,500.00 (My Largest Club)||$190 (Autoship)|
|Monthly Payroll||$21,000 (For All Locations)||None|
Although we grossed slightly over $1 million per year our expenses were also close to $1 million per year. Big risk and big investment. I needed a lot of customers to be able to make a profit. We attracted customers by focusing on three core business principles:
- An excellent product that effectively met our customers’ needs.
- Competitively priced.
- Superior customer service.
The main challenge of all network marketing companies is creating an organization large enough to earn company commissions from their compensation plan to cover the start up and ongoing expenses. Most people can’t do this because it takes too much time to develop an organization.
The main challenge of a traditional business is attracting a large enough customer base to cover the large start up costs and ongoing expenses. Most people fail to do this and go out of business.
For my Synergy business I tried to develop a traditional business plan that would create positive cash flow to bridge the time gap needed to grow a large enough organization. This would allow me to eventually tap into the Synergy compensation plan, as well as turbo charge it through product sales to customers, not just through monthly autoships from distributors.
When Synergy created the 48 pack for ProArgi-9 Plus I immediately saw the business window I needed to make this happen. I also saw the potential of the Internet to brand myself and create trust. People buy from people they trust. We’re also in the information age so I created valuable information that would address the wellness needs of Americas while properly placing ProArgi-9 Plus as a product that could help meet those needs.
By applying the three core business principles from above I’ve been able to grow a vibrant Synergy business. And, by acting as a distribution center I could make more money by directly servicing my customers rather than having them go through the Synergy’s Preferred Customer program. Here are my numbers for June 2011:
|Net Profit from
The above chart shows you the Synergy Commissions earned from the company, the Net Profit from product sales of ProArgi-9 Plus, and the Total positive cash flow generated. You will note that my “Net Profit from Sales” is three times greater then my“Synergy Commissions.”
And here is an interesting factor. My “Net Profit from Sales” was generated from 40 customer orders. This makes the average “Net Profit per Order” at about $30. If I had 100 orders per month then my net profit from sales would hit $3,000 per month. Add back in my Synergy commissions of $393.04 per month and the annual income from my Synergy business would be $40,720.08.
The National Average Wage Index for 2009 was $40,711.61.
By concentrating on customer acquisition I could develop
a full time income from my Synergy business.
So, what are the keys to acquiring customers? We’ll talk about this in our next update.That’s it for now. Have a Blessed Week!