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Focus on Creativity
They say that ‘necessity is the mother of invention’ and when you think about it how
true that is. When the chips are down the mind can create all sorts of imaginative
escape routes. It follows therefore that when you challenge your mind to find another
way out of the cash flow challenge, there usually are ideas that can help.
For example the very structure of the sales process…do you ask for deposits? Do you
collect cash before delivery? Is there a system for bringing money in before you
spend out and thus prevent a cash deficit?
Deposits, as an example, are not common in the business to business world although
we all appreciate the need for them in any consumer lead sales environment. If we are
mentally attuned to paying a fair commitment up front for personal purchases then
why isn’t it a more common practice within the business to business market place?
I absolutely promise that if a business wants what you are selling then a reasonable
deposit is perfectly acceptable and doesn’t wobble the sale. I might also add…that if
you are thinking of the worst and believing that many of your clients would run away
when pushed gently for a little up front monies…why is that? If it is because they do
not have it then aren’t you running the much greater risk of the full debt being stacked
up to a client that maybe cannot pay at the end of the process either? Maybe this is
bad risk business and leaves you with an even bigger problem? Asking for money up
front isn’t rude and even gleans respect that you can be so strong with your terms of
sale. You have nothing to fear…the worst that anyone can say is ‘No’ and thus you
are in no worse a position. Just possibly many will see that it is a perfectly normal
request and you’ll have 20-40% of sales paying you some very needed and
appreciated cash flow. Please consider deposits more seriously.
What about cash on or before delivery? Well again it is common place in a consumer
sales environment – one wouldn’t expect to have anything without paying, so in
reality it isn’t that different in a business to business environment. The commonly
accepted thing though is 30 days credit – which as we all appreciate actually becomes
almost 90 days credit! Why don’t you take control of that and simply say that you
cannot continue to supply if their cash isn’t forthcoming within a more viable time
frame for you. If you are in a regular or repeat sales scenario than at least making sure
that clients keep paying you and don’t fall even further behind is critical or else once
again you might be in the risk of losing it all.
Just a thought on this issue…factoring or invoice discounting can be extremely useful
here. It will cost you and the commissions taken by banks and finance houses need to
be added to the sales costs, but in some instances it might be a very good shorter term
arrangement. Typically a finance house pays 85% or more up front…this is critical
when you are spending on a physical commodity as part of your service ( as opposed
to just a labour cost) as it at least allows you to pay your suppliers and staff at he end
of the month.
Explore the specifics for your business and ask several factoring houses - in today’s
competitive market they can be encouraged to be more competitive with their
offering. Check the amount they will allow you to extend credit to…make sure that it
is sufficient for 3 months trading…again I have seen clients caught out by factoring
providers that sound helpful but then limit the ‘debt’ to a set amount that is in fact
eaten up inside 4 to 6 weeks.
However the real thought with creativity is more along the lines of imaginative ways
to sell and package your product or service. Being creative with money management
is a good skill but creativity with selling is far more powerful.
Too often a business has a list of offerings and sees them merely as an available list
instead of being creative with packaged offers and encouraging either increase in
sales value or using the ‘offer’ to encourage other things such as speedier payment.
Lets face it, we’ve grown up since we were children with offers all around us
tempting us to purchase ahead of time…from cans of baked beans in packs of 24 to
larger tins of coffee or tea to 24 cans of lager just in case your quiet night in watching
the footie becomes a neighbourhood party! So why not create packaged offers with
our service or products? Use them to increase order values or even retain
clients…they aren’t going far from you if you have talked them into a future purchase
scenario…and this can be done with services too. What is to stop them agreeing to
your service for a year ahead if they sign a reduced deal rate? How about even
including extra months for the price and extra visits or bonus products? Creativity in
these areas – especially if you have a pretty rigid structure for pricing and delivery,
will help massively. Typically if you are much the same as your industry competitors
then these sorts of tweaks give you a valuable marketing edge.
If cash flow isn’t your concern because the margins on your products or services are
high, then going the other way and adding sales volumes by encouraging the delay of
payments or indeed re structuring the sale so that they aren’t in fact sold merely hired
can be beneficial. When you sit down with an open mind and think of the options
there are always several…the challenge is to open your mind to them as they aren’t
normally done and the first reactive brain impulse is to say it ‘can’t be done’. There is
no such word as can’t.
Creativity can also be shown in your marketing edge and stark images that have hard
hitting impact together with direct words when the target is more used to a veiled
subtle approach can make you stand out at just the right time. Creating a new
approach maybe that merely says a few home truths can have huge impact. If you’re
into dentistry or cosmetic enhancements try something like:
“Dirty Teeth Are Horrible!
People don’t like dirty and rotting teeth. They won’t say it to your face but they will
form an impression and walk away with their wallet. It doesn’t have to be that way.
You can have great looking teeth if you let Abc Dental Care help you.
Fact: better teeth equals better image equals opened wallets”
Simply show a rotten mouth next to a white smile. Let the pictures talk but let the
message be clear and to the point… this type of spending will show a tangible return,
do it today.
Take an hour today or tomorrow and think of a creative approach that ‘tells it like it
is’. I firmly believe that you can say something straight and to the point and be more
effective and that too often our thoughts on promotional materials are too gentle and
too vague. Hit me straight between the eyes…remember if I am not ever interested
because in that example I have great teeth already then it doesn’t matter because I am
not interested…and if I am vaguely interested you’ve just hit me harder and more
direct than all of the other gently cosmetically oriented ‘have a nice smile’
approaches ever have and you are the one that stands out and gives me a reason to act.
Get creative too with reasons why I should buy from you other than price. Give me
something unique – you! Make it personal! Let me know that it is you I get when I
invest…and that you can take me personally to where I want to go. Put more of you
