EPISODE C5.002 Audit and Top Grade All Accounts

Introduction
New week, same perspective with greater conviction.

After being attentive to the weekend news about the continued arbitrary government response to COVID19, there is only one course for the business owner - ignore their word salad of concern and work around it. 

Being passive and waiting for the right decision will put you out of business. There are only two ‘people’ who have that right - you and the customer.

IBGR is committed to your success and our programming is for legal aggression (OK, I’ll make it nicer - assertiveness) to open, stay open, and be profitable.

Unlike the rest of society - we have your back.

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Show Objectives
Stage V demands many profitability decisions. If you are Selling the company, ignore this step. Let the new owners deal with it. If you are going to Reinvent the business then this is essential. Not only is it required to move on to Stage VI, it is just sound business and now is the time.

Key Issues - Owner/Manager Perspective:

1. Lifetime Value of Accounts
2. Historical data for each Account
3. Current Profitability of each Account
4. Deciding who to Cut, Who to Enhance

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What You Need to Know
You can only really successfully perform this objective if several other earlier objectives are achieved:

• A CRM (Customer Relationship Management) Platform that is consistently updated with accurate information;
• Value Mapping of all Variable Cost Processes (making products or delivering services);
• Company-wide ABC (Activity Based Costing) into all functions

What You Need to Do

1. Determine or review lifetime value of each account. Purchases per year X estimated time as a customer = ?
2. Review buying pattern over the last year. Up, Down, or Flat with rationale for the pattern.
3. Estimate or determine share of wallet and chart it over time. How much of this account do we service vs the competition and how has that changed over time?
4. Determine current profitability of account - includes product & service buys. Chart profitability over time and match purchases to the profitability of products and services.
5. Rank order accounts and indicate the top and bottom 10%. Top 10% to receive added focus, more sales support, potentially upgraded or new offer, potential collaboration partner. Bottom 10% - raise prices, discontinue products and services, create a different offer to reduce costs and make the account more profitable.

Shows

• Previous: EPISODE C5.001 OVERVIEW OF SALES FOR STAGE V BUSINESSES
• Next: C5.003 Propose Price Increases for Under Performing Accounts and Products & Services

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​by eman