"Acres of diamonds" or succeeding in business in a downturn

Acres of Diamonds
(Earle Nightingale)

Or doing business in a hard economic downturn

We have operated a small on line business for 11 years and each year at Christmas I sit down and write my upcoming year’s business plan, after reviewing the previous years progress we can now set our upcoming years goals.

Wouldn’t it be nice to know at the beginning of each financial year what you will be bringing in as income that year. This is where the “Acres of diamonds” come into play.
It was over 40 years ago I heard the “Acres of Diamonds” story and it is a philosophy that has stuck with me ever since and one that I build a business around.

The reason I am writing this is that I see a lot of companies blindly attacking the market trying to get a share of it for themselves. Believe me I used to be one of those people until I learnt that there is an easier way.

For the past 11 years we have dealt with one supplier ( who has been in business since 1995) and with the economy as it is we get concerned about having all our eggs in one basket, what would happen if our supplier hit bad times?

So this year we asked our supplier exactly the same questions we ask of ourselves at the beginning of the year, but this time we turn the tables.

We sit down with our supplier to review our marketing plans for the year to make sure we are not duplicating our efforts but mainly to ensure we are both on the same track.

Now the next question is one we had never asked, we had assumed they knew. We asked them if they knew what we were going to do with them in terms of business for the coming year and their answer didn’t really surprise us, they said NO.

When I had another business, selling office furniture and planning office layouts, each year I sat down with my top 10 customers and asked them what they were planning to do with my company the following year, with this answer it made it much easier to plan my time and marketing dollars were directed to areas that needed them, Thus I was able to know what my sales could be for the year and where I needed to be more proactive, it made for a much less stressful year.

This would have been a question I would have readily answered for my supplier, I had my business plan.

Now with my supplier, this would have been such a simple process as they have a data base of 2,000 names and of these there are 700 active customers, the automatic response would be lets go after the 1,300 non active customers, but my response is, spend time with your advocates, they are converted and now need some TLC, they don’t need the heavy sell they are already converts.
My supplier has a gross turnover of say $2,000,000 and my sales to them alone this year is say $70,000 and my projected sales for the coming year are a proposed 30% increase giving a potential $91,000 business for my supplier, now if they spent time on 10% of their active accounts and pick the top ones, so take those 70 companies and ask them the same question, what will you be doing with us in business this year and what do you need from us to achieve this goal. Now that is a poignant question, “what can we do to help you achieve your goal”?

If those top 10% (70 companies) did the same as what we were planning on doing then my supplier would see their sales increase from $2,000,000 to $6,370,000 a 300% increase with customers they already had, this is the “Acres of diamonds” principle.

Their marketing budget would be aimed at the areas their customers wanted help in, their time is spent more productively on those 10% allowing them time to nurture the balance of their data base (1,300 -90%), now with the correct marketing initiatives and through newsletters showing how their customers (The 10%) are growing their business during these bad times, a percentage of the 90% who were sitting on the fence will want to come over to the other side and reap some of these same benefits.

So how does this fit with companies who are just starting.
Go after companies or people you want to do business with and companies or people that will be able to give you business on a continuing basis and for those who have a client base, look at these and ask them what they need from you to buy more of your products or what you can do to help them sell more of your products. Just asking the question develops discussion.
Selling is like a relationship, with your customers are you treating them any differently now that when you were trying to win the business?
As with any relationship it needs to be nurtured, when you were first going out with your girlfriend or wife, you wined and dined bought roses, it is the same with any sale you wine and dine, get the sale and forget them and move on to the next venture, the customer is the same as your partner they continually need that reassurance that you still care. Treat them always as if you are still trying to win their attention and you will never lose.

I do hope this helps, as selling is easy, it is the keeping of the customer that takes the time and with the correct questions you will succeed, I know I will stay with my supplier but we need to take our relationship to a new level and at the end of the day we will both succeed.
Good Luck
Peter Sauer

Wildflowers Aromatherapy and Gifts