How to "Audit" Your Business and ReStrategize

by Gail Oliver, Online Marketing Consultant

How often do you do an “audit” of your business? This is where you take a look at what’s selling and what’s not selling, and why. This allows you to then strategize on how to exploit your successful products and fix the ones that are troublesome.

You need to examine which products have the highest and lowest:

traffic
conversion rate
orders
revenues
costs
profits

In my new 60-page Strategic Business Planner, I have designed planning pages that help you analyze these stats so you can identify new opportunities, expand the successful products, fix the problem products, as well as provide strategic tactics to reach these goals and then track the results. The planner also helps you do an audit of your current pricing strategy as well as your sales channel strategy.

When a Product Has a High Conversion Rate

For example, the other day I was looking at one of my own products and saw that it had a sales conversion rate of over 15%. A normal conversion rate is 1 to 5%, so a 15% conversion rate tells me I need to exploit this success. What are some strategies for doing this?

Drive more traffic to the listing.
Run ads on the listing, because ads are always more profitable on high conversion products.
Possibly spin this product off into similar products with different features and/or targeting new niches.

When a Product Has a Low Profit Margin

Let’s take another example. I had a customer years back who was selling 10,000 baby headbands a month. You would think that sounds successful, but it was actually an unprofitable business. You see, in order to sell these 10,000 headbands month, she needed a staff of 8 people. Also, when other competitors saw how much she was selling, they flooded the market with similar, lower priced headbands, meaning she had to lower her price to stay competitive.

The result was she was barely breaking even. The high labor cost to produce the product, combined with having to charge a low price, meant almost no profit. So, what should be her strategy to fix this low profit margin product?

She could find ways to lower her material costs, to offset the labor costs.
She could find ways to speed up production time to lower labor costs.
She could risk raising the price just $1, as it could mean $10,000 more in profit each month, if sales volume is not impacted by the increased price.
She could move out of this niche altogether and offer a higher-end headband that she could charge more for, with better profit margins.

The point is, if you don’t analyze your stats, you might miss those rising stars, solid sellers, maturing products, non-profitable products or even just problem products.

My Strategic Business Planner covers 3 of the 4 Ps, of Product, Price, Place (Promotion is covered in my Marketing Planner). Therefore, it covers what you sell, how much you sell it for and where you sell it, and all of these need to be re-evaluated and re-strategized from time to time so that your business stays on top of the market and the competition.

Other Things To Know This Week

If you struggle with Pinterest, take this free course they offer.
Netflix’s show Outer Banks is causing huge demand on Etsy for the jewelry and fashion.
Tie dye sweats are another hot trend selling out online.
12 top selling products online in April.
Sneeze guards might over take face masks for Covid-19 prevention.

Have a great week!