Economy

How has the ecomony affected your businesses? Jewelry sales have been flat, yet consistent. I know this seems strange in a down economy, but this particular luxury seems to be one that people tend to allow themselves. How are things with your products?

-Christopher Dixon
www.profitpassion.com


Jewelry Kit Business

The economy for business to business sales will always vary from retail sales, whether for necessities or niceties.

You'll also find that individuals in the US will adjust their spending according to their perceptions moreso than reality. So, if they perceive that the ecomony is alright, then they act accordingly.

The fact that perception can be stronger than reality has been demonstrated in the US mindset on several occasions, one the most famous occurences was during Orson Welles' "War of the Worlds" radio broadcast. People who missed the beginning of his show, thought the live staged show and sound effects were real and acted on it.
Some tuned to other stations and found only typical broadcasts on all other stations, and realized the invasion was fiction. But, some went on their mistaked perception without checking the facts.

I witnessed a similar event that is just as telling. Stationed in West Germany during the mid '70s, we only got Johnny Carson's "Tonight Show" on Tuesdays, and they were re-broadcast from earlier dates, never live.

On one Tuesday, Carson made a couple jokes about a toilet paper shortage in one part of the US. Within 3 days, the PXs and commissaries at military bases all across Europe were out of stock and resorted to rationing toilet paper. It seems many military families created a truth based on their mistaken perceptions.

So, the economy may be doing better than Greenspan or the national news reports, if the public's perception is that things are fine in their part of the country or their segment of the economy.

Selling promotional advertising, my perception is that existing clients and new customers as well are still buying, so my industry is doing well. However, my competitor who is losing sales to me and others, may have both a different perception and reality.

Sometimes we create our own reality, by the subconcious messages we send out, while making our sales presentation. One jewelry store may do better then another, due to the mindset of the sales people and management. Those who project a positive atmosphere can expect to see better sales than the store that dwells on the negatives.

One last story.

A business owner is thrilled that he is able to put his son through college, and now the son is coming back to help him in the family diner.

The son returns and immediately begins to make suggestions and even decisions. He cuts back on grocery orders, and also reduces the advertising budget, noting that the economical news is bad. To save money, he even cancelled the expensive billboard before the highway exit.

Some customers don't get the meal they want, as they run short of popular items, and they take their business elsewhere. Others, eat elsewhere because they no longer read or heard the ads that asked then to "Eat here".

In no time at all, the father is thanking the son for helping to avoid the disaster that could have happened if he hadn't reduced spending before the big drop-off in customers.

I'll end there, as this has already run much longer than I intended. You can go back to work on other business now.

I'd just add, that as I changed my expectations, my sales have improved, beyond what my company projected. Beware of falling to the level of only getting what someone else tells you is there "reality".

Dennis Bevers




My online promotional store for those who want more results!

Funny that. The economy effecting things. THAT was the excuse used by every Dot Bomb.

They never blamed their lack of management skills - as if spending $500,000 to have Rod Stewart entertain at their private office staff only after work Friday party had anything to do with their collapse. Or installing private ten pin bowling lanes in the office. Or buying brand new luxury cars for all. Or huge mahogany desks. All while never having actually made a penny. All while never actually selling anything the customer wanted.

No. It was none of that. It was the economy.

Got news for ya... if ya can't make money while the economy is good you ain't gonna make it while the economy is bad.

Anyways. A quick check of some of my offline activities sees an INCREASE in business. Have recently launched another business which has been profitable from the get go.

What's interesting about this new business is... it is a "luxury" business. It does NOT cater to a NEED. It caters to a WANT that most people cannot bring themselves to spend money on.

Go back thirty years. No-one but the wealthy payed someone to mow their lawn. Everyone did it themselves. These days, however, people do not mow their lawn. They pay someone else to do it.

My new business is along the same lines. No it is not lawnmowing. But it is something MOST people do themselves.

Who cares about most people? Not I. I am only interested in those who WANT my service.

I am a realist about it too. I do not expect to have 100 customers a week. A few new and regular customers a week will do nicely. The profits add up.

Is our economy any better than yours?

I doubt it. Seems economies are pretty much the same the world over for western countries. Our stock market took a hit when the bubble burst. Our dollar is WEAK and that makes imports very expensive. We live in a country the size of the US but with the population of LA. A vast array of infrastructure has to be supported by that small population. (Yes. I know Canada has a larger land area and only marginal larger population.)

My point?

Who knows. When I start it could end up anywhere.

Oh. Now I kinda remember. The economy silly. Bah humbug. I refuse to participate in a bad economy - I won't let it dictate my spending habits or restrict my business. I will be pro-active. New customer acquisition numbers slowing? Do more marketing.

Get it. It's how YOU react that will ultimately tell how your business goes. Dennis' examples are good. Here's one of my own...

There are two Chemists in my town (a chemist is a pharmacy and you may know it as a drug store). There are more than two... but I'm talking about these two in the example.

Anyway. One of the chemists is a client of one of my businesses. The other is not. The client chemist is not nearby anything. If you did a feasability study before openning up you would not open a chemist there. All customers have to go out of their way to go their - including old people.

The other chemist is near three banks and a couple of charity stores - both types of "business" are frequented by old people in vast numbers.

The chemist who is not my client... the one near the banks... will not spend a single penny on his business. His business is dying a slow death.

The out of the way chemist does spend money on his business. He spends it to make his staff look well groomed, on the appearance of his store, on counter top promotions, on window promotions, etc. His business is booming and once planning permission comes through he will be taking over the vacant store next door and expanding into it.

One is thinking and thus action restrictive. The other is thinking and thus acting expansive. The economy is the same for both. They sell the same products. One has a location advantage and squanders it. The other has a location dis-advantage and does not see it.

Will there be fluctuations in your business from month to month?

Yep. That's the nature of business. And sometimes you cannot even figure out why the fluctuation happened. Could be holidays (vacations), certain local events, rents and home taxes go up and the bill arrives, electricity reading and billing month, or even Sun spots. Way to many reasons to always pin point months with lower performance numbers. Just except it happens, plan for it by socking some of your profits away, and move on.

Michael Ross

The new business I mentioned was written about in The Great Ideas Letter. The test results - the ads we ran and everything about how we did it - will be revealed in an upcoming issue. Subscribe to read all about it.


The Great Ideas Letter - one year old and going strong

You are absolutely right! I agree whole-heartedly!

-Christopher Dixon
http://www.profitpassion.com


Jewelry Sales Like Mad!