Profit Plan for Any Business
Regardless which size your business – profit is a main concern for all business owners. Anne C. Graham, my interview guest on this topic is a #1 Bestselling Author, International Speaker, and Accelerator.
Anne is on a mission to help 5 million business leaders and their teams double their profit per employee – or more in less than one year, in less time per week than they’re spending on email per day.
In the interview she explains the engaging 5-step Profit Plan on how to do it which is the topic of her new book, Profit in Plain Sight.
Join me in this interview and learn the simple steps on how to improve your bottom line.
I invite you to add your comments at the bottom of this blog post in the Facebook Comment box. I always love to hear from you and learn how this interview made a difference for you!
|Petra:||This is Petra Mayer at Petra Mayer Consulting: Online Strategy Made Easy and welcome to my interview series. Today I have an amazing speaker here, Anne C. Graham. She’s a number one bestselling author and international speaker.
She’s on a mission to help 5 million business leaders and their teams to double their profits per employee or more, in less than one year in less time per week than they are spending on emails per day.
Her new book that she’s just recently launched is Profit in Plain Sight. It includes an engaging five-step profit plan to do that. So, very welcome to my interview blog Anne. I am so thrilled to have you here.
|Anne:||Petra, we are going to have a great time giving some great content for your audience here today.|
|Petra:||That’s fantastic. I’m really looking forward to learning about your book about how you implement this into your own business and how your clients are benefiting from it.|
|Anne:||You bet, happy to share.|
|Petra:||Let’s get right into it. What do you see to be the biggest challenge for small business leaders in their business today?|
|Anne:||Well, I’ll tell you what I hear all the time whether it’s small business owners, whether it’s solo entrepreneurs, whether it’s even big business and that is people saying, I don’t have the budget for that.
There are so many good things we can be doing in our business and those seven words seem to get in the way all the time. It’s happened in my own business for sure.
|Petra:||Yes, I can relate to that. We have lots of opportunities knocking on the doorstep and how often do we have to turn them away?|
|Anne:||Absolutely. And those are all usually growth opportunities. I mean every investment we make in our business, whether it’s coaching or whether it’s going to a seminar, whether it’s buying new software for our business, whether it’s just hiring some virtual assistants.
All of those things help us accelerate our business and get where we are trying to go even faster and as soon as we start putting those on hold we get stuck. That’s what I’m trying to change is that whole feeling of being stuck and not able to grow the way you want to grow your business.
|Petra:||In your book Profit in Plain Sight that was just recently released, there was a lot of books on that topic promising more sales, promising more profits. Why should readers read your book?|
|Anne:||One very big reason and that is as a reader of lots and lots of business books, I have been so frustrated in the past reading books that really inspired me and yet when I went to try and implement I couldn’t figure out how to do it or I had to reinvent the wheel.
I struggled and eventually the book went on the bookshelf along with all the others. When I wrote Profit in Plain Sight I was very committed to making sure that this book was full of how’s. But I have some good news for you, it’s not a boring book full of how’s.
What I’ve done is every single chapter has got at least two or three really great training videos that you can just access at no charge and figure out the how’s when you are ready to go there. So the book itself is going to give you the big picture of all the things you should be doing in your business and when you’re ready to step up and actually go do them you won’t have to reinvent the wheel.
|Petra:||Wow! That sounds interesting. It’s more than a book, it’s almost like a whole program in itself.|
|Anne:||Exactly, exactly and that was my passion was if I’m going to have an impact on 5 million business folks, I can’t do it one person at a time. I can’t even do it as a coach or a mentor. But what I can do is I can give people all of my school of hard knocks and make sure that they never have to go get that big black spot on their forehead from banging their head against the wall.|
|Petra:||You just mentioned a few words here. You mentioned passion and I can hear that, I can hear that coming through. You are obviously really passionate about the book and what you’ve achieved here.
Most business owners particularly when we are thinking about the coaches and service professionals who might be listening to this blog when you talk about profitability they think of massive spreadsheets, learn how to read their finance statements.
They’ve got to talk to their accountants and it’s just like watching paint dry. How do you make it? You said it’s entertaining. You said it’s inclusive of the listener, the reader. How do you do that?
|Anne:||I can tell you that I do a lot of public speaking as well and oftentimes when I get up I will ask my audience I will say, how many of you think this is going to be a really boring conversation about accounting and you really don’t want to be here today? Most of them put their hands up.
And it’s like well we are in for a good little ride here because whether it’s the book or whether it’s the speaking, everything I do is focused on how can you deliver great value to your customers because that is what drives profitability. You can have all the spreadsheets in the world, you can understand your P&L statement and your income statement and your balance sheet inside and out.
That does not drive profitability. What drives profitability is you being able to go to a customer with a fabulous value proposition where they say I want that and I’m willing to pay a good price to get it because you are solving their problems, you are making their lives easier.
The book is all about how do you create a company, create an organization, whether you are a one-person shop or a huge organization that actually delivers great value to customers? All throughout the book I’ve shared real life stories whether they are from my own experience in my own business or in some other companies that I have led and managed in the past or whether it’s from my clients.
As a result of the stories you are really able to put yourself in that picture and go, I can do this, this works for me, I get it. So far from being a dry and dull sort of accounting type thing it’s all about putting some fun and some passion back in your business by doing what you probably went into business to do in the first place, which is to look after your customers.
|Petra:||Yes. And think that’s what you are saying in your book that only customers create cash flow. I think you’ve just emphasized that in what you were just saying. If we give our customers what they are looking for then they’ll keep coming back to us.|
|Anne:||Exactly! They will take care of us if we take care of them, no question.|
|Petra:||So along with being a noted speaker and now a very accomplished author you call yourself an accelerator, what do you define to be an accelerator?|
|Anne:||Well when you think of the accelerator in your car it’s what makes your car go faster and that is what I do with the businesses that I work with. So often I find small business owners and even larger companies get lost in the bright shiny objects and they start doing all kind of things, good things in their business.
But they are not necessarily focused on what are the few key things that I really need to focus on and really need to do well in order to drive a higher level of sales, a higher level of profit. And I always come back to saying what we all want to do is sell more products and services to more customers at higher prices and lower costs.
So as an accelerator I show companies, whether it’s through the book or whether it’s through personal consulting or speaking or any other things I do, how to actually achieve those four goals; selling more products and services to more customers at higher prices and lower costs.
And then I add a fifth one which is really the wild card for growth and that is around innovation. I’ve got some very, very easy ways that don’t require a bunch of R&D dollars. There are actually 21 of them, I’ve used all 21 in my own one-person business.
|Petra:||R&D makes me think manufacturing, engineering, biotech etc and I know you love working with those type of companies too. On the other hand, that’s not what your company is about so how do you use R&D in your company?|
|Anne:||What I do is the R&D that I use just comes right back to the conversations I have with my customers. I try and figure out how can I save them time because any time you can save them time that’s an innovation? How can you save or make them money? That’s an innovation.
How can you solve the real problems that they are pulling their hair out about? That’s an innovation. How can you create a feel-good, something that just makes them smile when they do business with you because it’s just fun to do business with you? And the last one is how can you give them peace of mind and lower their risk?
So unlike conventional R&D where you think about products and services and manufacturing and hi-tech and Apple and so on and so forth, those things can all be copied by any one of your competitors. You come out with a new product, somebody else will have it no time.
But when you actually come up with a way to make a customer feel like they want to do business with you or you help them sleep well at night your competitors can’t copy that because they can’t even really figure out how you’ve done it.
That’s why the kind of innovation that I look at for small business as well as large business is really focus right back on how do I create value to a customer that is really hard for competitors to copy. In Profit in Plain Sight, in the book, I’ve actually done a table in there that shows how Apple has actually done every single one of these 21 forms of innovations. It’s one of the reasons they are so successful. Apple, one of the biggest companies in the world!
In the video that goes along with that chapter I actually walk you right back through each of the 21 forms of innovation and how I’ve used them in my one-person business. So whether it’s Apple, whether it’s me, it works right across the board. So whatever size company your readers are involved with right now, Petra, this could be something that works for them.
|Petra:||I know that your background is in big large organizations, Fortune 500 companies, isn’t it?|
|Anne:||It was in Fortune 500 companies when I first started my career, I worked for two Fortune 500 companies. I must admit after that I shifted gears. I went to smaller companies where I could actually get things done. I did a whole series of about six or seven turnarounds after that and in one of the cases I was actually the first employee.
So I’ve worked with very, very big companies. I’ve worked with mid-sized companies. I have worked with small companies and I have worked for myself in my own firm now since 2000, so 15 years as a soloprenuer.
|Petra:||It sounds fascinating how you apply learning form big large organizations; you look at what they are doing and then as you said in your videos you take it back down to your own soloprenuer organization and how you apply it in there which really makes what you’re talking about in your book and in your videos applicable to any company. Is that right?|
|Anne:||Exactly! A lot of times what I’m doing when I’m looking at some of the larger organizations I’m actually looking at what they’ve done wrong and where they’ve lost their way. Because most of the turnarounds that I did that was exactly what had happened is that they had gotten themselves so caught up in all the stuff that you can go and take all these executive seminars and everything else.
They’d really lost sight of coming right back to where we’ve been, delivering value to a customer. So a lot of what I do is take complexity and boil it right back down to something that is simple and doable. Petra, in your introduction you mentioned one of the things that I’m really passionate about which is to make sure that you can do this in less time per week than you are spending on email per day.
When big companies take on these big, big projects they start using change management and all that other stuff they often fail because they’ve just made it so complicated. So everything that I do if you are willing to spend about 90 minutes once a week simply doing the profit plan you are going to see results.
And to me that’s what small business needs is it’s got to be manageable because we are all busy running our businesses. We are looking after customers. We are looking after customer service. We are looking after a team of people if we have a team supporting us.
If we are on our own we are the one on paper hanger. We are going down and picking up the mail as well. We don’t have time for big complicated projects. It’s got to be doable. But if you’ve got time for email you’ve got time for a profit plan.
|Petra:||Well I think you have to make the time by killing some of those emails. I mean we are just stuck down into the email we are email administrators in our lives these days. You mentioned the profit plan so now of course I’m really curious. When you say the 90-minute, the profit plan, can you give us some insight, some ideas of what that entails?|
|Anne:||I can indeed. I’m going to structure it with the five letters plus one more that are in PROFIT. If you just think P-R-O-F-I plus T that is the 5-step plan. I’ll take you through each one of those very briefly. The first step in the profit plan is the P for profit is all about making sure that you’ve got really penetrating and powerful insights.
There are a couple of chapters at the beginning of the book where I show you how in a very, very easy non-accounting way, figure out which of your customers are profitable and which ones aren’t because too often most businesses will focus on revenue because revenue is easy to measure.
Well, guess what? Oftentimes your biggest revenue customers are your least profitable because we bend over backwards, we service the heck out of them, they grind us on price, your biggest customers are not always your best.
I’ve done this over and over again in live workshops and when people see who is profitable and who is not, not from an accounting perspective but from a behavioral perspective—and I’ll give you a quick little example on that in just a sec—they are able to say oh I can change that, I can shift that.
So the little example I’ll give you is just almost every person I know can think of a dream customer, the ones that they wish they had more of and they can think of a nightmare customer. You don’t necessarily have to know all the accounting behind them to understand who’s a dream and who’s a nightmare.
Going through figuring out who’s profitable and who’s not is a little bit more involved than that. It’s outlined in the book extremely well but conceptually it’s as easy as figuring out dream and nightmare. If you can get that done all of a sudden every other strategy you use in your business is going to become crystal clear.
That’s one of the big powerful insights is shifting your mindset from who is driving the most sales, where is my biggest revenue to who is keeping me in business, who is profitable for me and how do I go and find more like those? That particular insight drives everything from looking at who your ideal customers need to be and who you should be avoiding to all the other steps in the profit plan so the P is for powerful penetrating insights.
The R in PROFIT is about realizing rapid results with what I call the 5R’s. There are five things that you can do with your existing customers. You don’t always have to be going out finding new customers and that’s one of the other really big insights.I was talking to a fellow just a couple of days ago. He said I’m always out there chasing new business. He said your book completely changed my thinking in terms of how I need to go back and really work with the customers I already have. So here are the 5Rs.
The first one is retaining your most profitable customers. When you know who they are, you know who you want to keep because they are the ones keeping you in business. The second R is something that I call ramping up. If you know your customers that are somewhat profitable but a little room for improvement there are probably 17 different techniques in the book as to how you can get more sales but more profitable sales, higher prices and lower costs with that particular group of customers.The third R is what I call restore to break even or better. This is basically taking your unprofitable customers and you don’t have to fire them in five out of six cases. In five out of six cases there is some kind of a self-inflicted wound on your end that is making them unprofitable.
I’ll give you a quick example there, it could be just because you are over-servicing. I was working with a small company that involved in placement services so HR placement, temporary and full time staff. They had a very, very big customer and they were bending over backwards to service this customer.
Contractually, they were obligated to provide three candidates for each open position. They were providing six. That made that customer unprofitable but it wasn’t because the customer was a bad customer it’s because they were over-servicing and the customer wasn’t seeing the value, they still only wanted to hire one person and in fact it took more time for the customer to go interview all six.
So when this organization saw where that client was at in terms of their overall profitability they went back to them and said we are actually doing you a disservice here by making you interview more people than you actually ever wanted to so why don’t we scale back to just going to the three that we originally agreed to?
It’s going to save you time, it’s going to save us time and we are both going to be happier doing business together. It’s as simple as those kinds of little shifts. That’s your third R. There are two more that most companies completely overlook. One is around regaining the customers who’ve left you, in other words lost customers.
We all know that we’ve got lost customers who’ve left us for some reason. We were outbid on a quotation or they just decided that they had an issue with us and they decided the grass was greener somewhere else. For whatever reason, we’ve lost customers.
Sometimes it’s really obvious, sometimes it’s less obvious. They’ve just taken some of their business somewhere else and we don’t even know we’ve lost that. But there’s a whole set of strategies around how you go and regain that business that you’ve lost and it really boils down to the grass is not always greener on the other side of that fence.
Oftentimes customers are happy to come back when we fix what went wrong and oftentimes they are just embarrassed to come back to us if they’ve gone and chosen another vendor. If we make it easy for them it’s an easy, easy way to get more business.
The final R is, reactivate. I would imagine because I’ve been here myself that every single person reading this blog has got a big database of customers and some of them they haven’t talked to in a dog’s age. They have gone inactive. I always sort of say are they dead or are they just sleeping.
Sometimes they’ve gone. They’ve gone out of business, it’s this, that or the other thing, they’ll never buy from you again. But oftentimes it’s our own neglect. I’ve been guilty of this in my own business of neglecting my database. Our own neglect means they just go quiet.
They don’t know what we are up to. They don’t know what we have in terms of products or services or offerings that could be beneficial to them. It really means that we sort of have to eat a little crow. We have to peel the egg off our face and we have to reach back out to them and say, listen I’m sorry that I’ve neglected you, tell me what going on in your world right now, how can I add value to you?
It’s not easy to do, but I’ll tell you it’s incredibly rewarding. When I’ve done this I’ve often found customers saying I was just thinking about you the other day or geez yes I should have reached out to you instead. It’s a fun process. So there is your P, your powerful insights and there is your R your realizing rapid results from the 5Rs.
Let me move on to the O, the F, and the I and the T. The O is what I call obliterating operational sludge. Sludge is just the stuff that gets into our systems where you end up reinventing the wheel. If you’ve got any, if you’re a larger organization where you’ve got a customer service staff the fact that your customer service staff are busy means that you’ve got sludge in your system because there’s a reason your customers are having to phone you.
So what I make sure I do in my own business is I always make sure there is at least 100:1 return on investment for anything I do. If I’m going to go speak to a group or if I’m going to consult to a group I will say here’s how you are going to get 100 times over what you are going to pay me.
How much do you think it was worth to me to find a plumber who could come over within half an hour as opposed to somebody who could come the next day? Pricing per value when that plumber showed up he wasn’t cheap but I’ll tell you something I happily paid what he wanted because my alternative was unthinkable.
|Petra:||For a plumber, no, amazing.|
|Anne:||Exactly! The I in PROFIT is the infinite return on investment of innovation. We already talked about innovation in the idea of Apple and my own small business using exactly the same strategies so I won’t belabor that one. But that’s your P-R-O-F-I.
Your T is the toughest thing to do and that is take action. I often find that business owners at any level have really good intentions and they get busy back in their email again or they get busy just doing all the sludge in their business.
They never actually carve out those 90 minutes once a week to just get really proactive and say what am I going to do about building a more profitable company so that that I can fund all the growth I want to do, I can hire the extra resources, I can invest in more training or more services, or equipment or whatever it is fits your business.
Maybe it’s just buying a better computer system, for example. I just went out and bought a brand new computer myself last week because I’ve worn all my keypad off. This one is so old. It’s being able to do that and not even think twice about it, you just go and you do it.
Powerful insights, realizing rapid results with the 5Rs, obliterating operational sludge, fearlessly pricing per value, the infinite ROI of innovation and simply taking action. That is the five-part profit plan and then what you have to do next.
|Petra:||That’s really impressive. I’m glad that we are doing this as a recording so people can listen to this over and over again and just really get clear of all this advice that you were just giving in the last five minutes. It’s just like my goodness!|
|Anne:||The key here is there’s a lot of advice there, there’s a lot of things that may feel a little overwhelming. You don’t do it all at once. You pick away at it bit by bit by bit. And you don’t have to do it 100% the first time round to see amazing results. The thing is it becomes very doable even if to feels a little overwhelming first time round.
If you do pick up a copy of the book, if anyone picks up a copy of Profit in Plain Sight what you’ll find is that at the end of every chapter there’s a little action plan and it just says do this, do this, do this.
So if you just actually read one chapter every month, there are only seven chapters in the book, but if you just did one every month and then said okay I’m going to carve out my 90 minutes once a week and I’m actually going to do this stuff, take action, you will see amazing results in your business.
|Petra:||Yes. I think you so hit that nail on its head because we get sucked into doing the activities of our business rather than working on our business and really doing activities that will grow our business. Now you seem to have a very can-do attitude. How can you make that rub off on the rest of us?|
|Anne:||Oh I wish I was a genie with a magic lamp for that one. The absolutely best advice I can give you to rub off on you is at this point most of us use some kind of electronic calendaring tool. It is as simple as going in there and scheduling an appointment with yourself and make it a recurring appointment that happens every single week.
I have a funny story to share with you. I did a speaking engagement about a year and a half ago and I was talking about this and talking about scheduling this time in. I had a phone call about three days later from one of the attendees.
Because I can guarantee what’s going to happen is they are going to get sucked right back into email and say oh well I’ll just kind of figure that out the next day. So what you want to do is you probably want to take your first 90-minute window and you want to maybe listen to this again and say okay my P, my R, my O, my F, my I, my T, what am I going to do in those areas that will move my business forward?
So once you get the ball rolling it starts to take on a life of its own but the easiest way for me to impart a can-do is to tell you get into your electronic calendar right now and go book yourself 90 minutes once a week. You might even have to move it around over time. I’m good with that.
|Petra:||So would you recommend for example that our listeners schedule that first 90-minute session and perhaps plan out the first three months?|
|Anne:||Absolutely! That would be great. If you could say in the next three months what am I going to do you could even pick three of the five Rs for example and say in month one I’m going to do this whole retention type strategy. I’m going to get back in touch with the customers that I know I really want to keep. My second month it’s going to be all about saying what can I do to wrap up those customers that are kind of so-so. How can I go and have meaningful conversations?
In Profit in Plain Sight there’s a whole other thing we don’t have time to d today, but it’s called a value creation conversation. When you can have a value creation conversation with your customers, it is not a sales call, it’s not a ride along, it’s not a meet and greet.
There are seven different categories of questions that you want to be able to ask your customer in terms of understanding how to create more value for them. And in my first 90 days I would spend a lot of time going out reconnecting with my best customers and my so-so customers using those value creation conversations.
That’s a great way to start because you will get all the insights you need for your business just by going out and having those meaningful dialogues with your customers. Again, there’s a little training video on the whole idea of doing value-creation conversations, it’s right there on a link in the book.
|Petra:||Wow! I’m really impressed. I was very curious to learn more about your book and about what you are doing. To me it sounds like you are creating amazing value with this book. Everything we’ve been talking about here is more than just reading a book. It’s really taking people and giving them instructions as well as tools and tips and how to actually implement that.|
|Anne:||Yes. It’s really providing a roadmap and the tool kit. The road map is the P-R-O-F-I-T. That’s basically saying I’m trying to get to this destination. Here are all the places that I need to move through in order to get there.
But it’s also the directions on where to turn right, where to turn left, where to go straight ahead. That’s the toolkit that you get in the videos and that is just is what makes it’s whole process so valuable. I had so much fun putting it together because it really made me think through things that I’m not doing in my own business.
|Petra:||Yes. So did you then start implementing it more stringently for yourself?|
|Anne:||I have my 90 minutes booked in my calendar every single week and I am now following my own advice and implementing more stringently – without question.|
|Anne:||Because again back in the roadmap I was doing it for my clients but it’s a shoemakers children, I wasn’t doing it for my own business until I basically sat down and applied the roadmaps to my own business.|
|Petra:||I do have one question with regards to your R where we are talking a lot about retaining, ramping up so this is all about existing clients.|
|Petra:||Some of the listeners might be fairly early in their business and may not have that many clients that they can fall back on. Do you also cover how to bring in new clients in your book?|
|Anne:||Absolutely! If you are focused on doing things like value-creation conversations, it’s every bit as valuable with a couple of little tweaks for new client acquisition. Because what you are looking for there is you are looking for alignment between your business and their business and making sure there’s going to be a good partnership.
I liken this to the idea of most of us know someone who has been divorced. It’s the same thing with your customers. You never started out planning on getting divorced but eventually some customers just become far too much of a pain in the neck for you or not profitable enough. Or they decide that they are not that keen on you or the services you’re providing and a divorce happens.
What you want to do is you want to be doing a better job during the dating game. And with some tweak to the value creation conversation you can do a better job while you are dating to figure out is this the kind of customer where we are going to have a great long-term relationship together, where there’s going to be mutual value and this will work for both of us.
I know for early stage business owners anything that moves is fair game. I get that and I have been there as well. There’s nothing wrong with taking on some customers just because you think you can solve a problem for them, you think that there is a need, they seem to be keen to work with you.
By all means cash flow is king when you first start out with your new business. But what you are going to want to do is as soon as you bring those new customers on board, you are going to want to start mentally putting them through your filters in terms of is this going to end up being a good relationship.
I guess I’ll come at that in two ways, Petra, and that is anything that moves in a new business is fair game because it’s cash flow. But as much as possible take yourself to a place where you are starting to get very good at the dating game so that as you grow your business even if it’s still pretty small you are bringing in the right customers.
Because I can tell you there is no greater energy suck and time suck for an entrepreneur or a small business than getting rid of the customers who are not a match. Most of us hate to do that and it saps a lot of energy from us.
|Petra:||Yes, for sure and it’s frustrating and it’s demotivating.|
|Anne:||And it takes time away from what you could be doing with new customers or customers who actually value you. So yes you want to start getting a little bit selective as soon as you feel comfortable that you’ve got your costs covered and that your cash flow is in a reasonable way.
It’s the same thing, it’s like hiring bad employees. Sure, you can hire a lot of employees just to basically put butts in seats. It will take you forever to get rid of them. It’s the same thing for customers that are not a match for you.
|Petra:||If we wanted to kind of give one final last summary statement, what’s the one most important thing readers will learn from Profit in Plain Sight?|
|Anne:||It’s going to be how to sell more products and services to more of your ideal customers at higher prices and lower costs. It’s Business 101.|
|Petra:||Excellent! Anne, I am super curious, I will get the book and watch your videos and really look at my schedule. Right now I have no idea where to squeeze that 90 minutes in but I think you’ve given me a lot of food for thought here and a lot of great ideas.
I am super thrilled to have you on my blog and in this interview. I’m really excited about sharing this with my audience. I’m almost speechless which doesn’t happen very often.
|Anne:||Well it was so much fun today Petra because I really appreciate the fact to help spread the word to your business owners and your entrepreneurs that are reading your blog, because business is supposed to be fun. There is supposed to be passion.
We are supposed to love what we are doing and the very, very best way to put the fun back into your business is to be working with customers you love and making great money doing it. If this helps to move the needle in that direction for you and for your blog readers, then we’ve achieved our objective today.
|Petra:||That’s correct. I wish you all the best to reach your 5 million business owners. You have a lofty goal there but from what I’ve heard here, 10 million would be really more suitable. We really need to get this word out. I’m really grateful for you spending the time with me here today and for talking about your book and sharing so much information from your book with my audience. I really appreciate it.|
|Anne:||Thank you Petra, it was my pleasure.|
|Petra:||Thank you so much, Anne.|