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July 2017 Newsletter – How to Multiply Your Profits

How to Multiply Your Profits

You may have seen the announcement last week that Amazon will start selling Sears Kenmore appliances. Not only that, they revealed Sears and Amazon will start working on fully integrating Amazon’s voice assistance, Alexa with Sear’s smart appliances.

This will allow people to control things like air conditioners with voice commands that will be synched with Alexa.

Neil Saunders, managing director of research firm GlobalData Retail said it’s a win for Sears, putting its products where customers are shopping. He went on to say because of Sears falling sales this is good step in finding “Other channels and routes to markets”.

This new relationship will provide Sears additional revenue because the service work and product warrantee services will be provided by Sears Home Services.

What is a Delivery Channel?Small Business Planning in Atlanta, GA

Sears and Amazon’s new venture is an example of a company developing additional Delivery Channels for its products/services. What is a Delivery Channel?

Delivery channels are the methods by which you deliver or distribute your product or service to your Customer. It is important to note there are several terms used for delivery channels. Sometimes these are called “sales channels,” “marketing channels”, or “distribution channels”. All these terms refer to how your product will be provided to your Customer; I will use the term “delivery channel.”

For instance, you could ship your product directly to a Customer, they could pick it up at your location, buy it from a retail store to whom you initially sold your product at wholesale prices, or, if applicable, they could download your product from your web site. Marketing-type delivery channels might involve doing direct sales to your Customer or developing, working with, and supporting a network of distributors.

Developing Multiple Delivery Channels

The more delivery channels you have, the more sales you can have by providing the same product to your Customers via multiple and alternative means.

For instance, the soft drink Coca-Cola® is delivered (sold) to their Customers in three basic ways:

  • Bottles, cans, or other containers purchased at stores
  • Fountain drinks purchased at restaurants, sporting events, or similar places
  • Bottles, cans, or other containers purchased via vending machines

Consequently, the Coca-Cola® bottling company can easily obtain additional revenue from the sale of one product, the Coca-Cola® soft drink, because it has multiple delivery channels. We have all seen this when a physical retail store chain establishes an online retail presence; it is just being delivered via a different channel.

Two Delivery Channel Decisions

Small Business Planning in Atlanta, GAThere are two decisions that involve this delivery channel area. First, which is the best and most appropriate delivery channel for your product? Second, which additional delivery channels justify their cost? Because there are additional costs to develop and maintain each delivery channel, you must compare your incremental revenue to your incremental costs to verify that the effort of creating additional delivery channels makes sense.

There is an added factor that must be considered when you explore additional delivery channels—will the marketplace be confused using the additional delivery channel so the overall message of your solution becomes distorted?

This issue of confusion is what Starbucks Coffee® faced when it introduced its VIA® product for making coffee at home compared to the product that was being delivered through its retail coffee establishments. That is, would VIA® be viewed as an alternative to going to a Starbucks Coffee® location and therefore cannibalize its sales, or be viewed as another delivery channel of the Starbucks Coffee® product and thereby grow overall sales?

Secondary Delivery Channels Benefits

Besides the additional revenue, there are two related secondary benefits that using multiple delivery channels can bring to your business. First, the same marketing efforts can be used to promote and drive multiple delivery channels. For instance, a television advertisement for a physical store can have a web site listed at the bottom and the words “shop online at” added at the end of the commercial.

Second, there is potential for a spillover effect when promoting one delivery channel when the same product can be purchased from a different delivery channel than the one being promoted in the advertising.

For instance, a soft drink advertisement shows the soft drink being served at a cool, relaxing, and pleasant pool party, which would encourage sales from a physical store delivery channel for take-home consumption. On a different occasion, the consumer passes a vending machine in the middle of a hot city, they remember the advertisement showing the pleasant pool party, and they purchase the same soft drink via a different delivery channel (the vending machine) because of the image that has been set in their mind.

Delivery Channel Assessment

To take advantage of new Delivery Channels an assessment is required of how you are providing your product to your Customer and whether you should expand your Small Business Planning in Atlanta, GAdelivery channels.

The determination of the delivery channel(s) for your product and the possible use of multiple delivery channels are influenced by the following factors:

  • How your Customer has traditionally purchased your product
  • The physical attributes of your product
  • Technology involving the delivery of your product
  • The amount of risk involved in the purchase (e.g., buying potato chips, which could easily be sold via a vending machine, compared to an automobile purchase)
  • The demographics/culture/religion of the purchaser
  • How you are able to reach the decision maker
  • The motives of the purchaser
  • The purchaser’s perceptions about your product
  • The ability of and knowledge of the purchaser
  • The attitudes toward your product
  • The lifestyle of the purchaser
  • How opinion leaders shape your market
  • How people’s roles and family influences affect various delivery channels
  • The social class of the purchaser
  • The culture and subculture of the purchaser

The bottom line of completing the above analysis is to maximize your revenue. So, you want to consider and possibly choose all the delivery channels you have available to generate the largest sales volume.

If you need assistance in fully developing your Delivery Channels, please contact us using the below information so we can show you to multiply your revenue and profits.

Fountainhead Consulting Group, Inc. is an Innovation and Business Planning firm. During the past 17 years we have shown over 1,200 companies how to achieve their goals by using our unique, comprehensive and systematic, innovation, business planning and growth Structure of Success™, Innovation Academy™ and FastTrak Innovation Program™ methodologies. Using the components in these methodologies, each month we examine an aspect of how to transform your business or organization into a true 21st Century operation.

Office phone: (770) 642-4220                                     

March 2016 Newsletter – Are You Taking Your Customer for a Ride?

Are You Taking Your Customer for a Ride?

This past week while talking to a well-known Marketing Consultant I was struck by two statements she made. “How you sell to your customer has totally changed. Companies that don’t get how to properly sell are going to be out of business”.

They went on to share that as a result of the proliferation of products and services available to consumers and organizations, customers have so many more choices than previously. This translates to significantly increased competition for you as a business or organization.

Sell Solutions, Not Features

Small Business Planning in Atlanta, GAWe have found the answer to this dilemma is that your sales process must be founded on selling solutions to your customer’s needs, not just promoting the features of your product. This may sound very easy on the surface, but it is actually much harder than it looks. This is because each of us just naturally tends to focus on what we have to sell and its attributes.

It is pretty easy to talk about what we have. It takes a whole lot more effort to uncover your customer’s needs as it relates to your product. To do this you have to first understand what they are trying to accomplish with regards to your product or service. We have found that a great way to un-ravel this mystery is to understand their goals in work or life that relate to your product or service?

Enable Customers to Achieve Their Goals in Life

So how do you understand your customer’s needs? What are they trying to accomplish? How can you identify their Small Business Planning in Atlanta, GAgoals related to your product or service? In other words, how do find out where they want to go so you can Take Your Customer for a Ride to Their Goals?

It is very simple, just ask them.

Unfortunately, many businesses just don’t do this. There are various reasons for this oversight. The major reason is that because they have dealt with so many customers in their particular market in the past many organizations just assume they know what their customer is trying to accomplish. Therefore they just focus on their product or service’s features.

There are three reasons for seeking to know your customer’s specific goals:

  1. You establish common ground with them and they begin to feel that you understand them and their needs
  2. You remind them of what they are seeking or trying to accomplish
  3. You may discover that they have goals related to your product or service of which you were not aware

Understanding Your Customer’s Goals

Small Business Planning in Atlanta, GATaking the few minutes it requires to explore the above is particularly important in Business to Business sales situations because it enables you to pinpoint their “buying criteria”.

However, this effort even pays off in Business to Customer sales situations. An example is that Home Depot has trained their staff to ask “what are you trying to do” when a customer asks for anything out of the ordinary.

For instance, if I asked someone at Home Depot where are 8” Lag Screws, they might say, what are you trying to do? I might reply, I am getting ready to build a deck and I need them need attach the joists to the house. They then might say “have you looked at using joist hangers”, or some other product.

Once they understand my goals they may suggest using their design services to design a deck or even have one of their contractors build the deck for me. Either of these could lead to additional revenue for Home Depot and perhaps a happier customer. None of this would have been possible without a staff member taking a little time to understand my goal as it related to their product – 8” Lag Screws.

Short, Intermediate, or Long-Term Goals

Please be aware that your customer’s goals may be short, intermediate, or long-term. What is the difference?Small Business Planning in Atlanta, GA

Short-term goals are things like getting a lower rate on a credit card, buying a certain cereal that may lower cholesterol, eating at a certain restaurant tonight, buying some fashionable new clothes for your children, or buying a car polish that will make your car look more attractive.

Intermediate-term goals are things like building retirement savings, exercising more, visiting Disney World, sending your children to a private school, or buying a prestigious new car.

Long-term goals are things like financial security, better health, enjoying life, your children excelling in life, or living a certain lifestyle.

Your Customer makes their purchasing decisions based on the perception that your product will enable them to achieve their short-term, intermediate-term, and long-term goals.

Goals Are Interrelated

If you examine the above lists closely, you will observe that they are interrelated.

For instance, a lower rate on a credit card may lead to building retirement saving, which may in turn lead to financial security. Buying a certain cereal to help lower cholesterol may lead to wanting to exercise more often, which should result in better health so that one could enjoy life more.

All these thoughts are running in a Customer’s mind; however, many times people are not consciously aware of them, even though they are influenced by them and make choices that move toward those goals.

By asking your customer questions or tapping into marketing and sales research on your customer you will be able to recognize and tie into your Customer’s short, intermediate, and long-term goals. This will allow you to properly layer both your marketing and sales messages in ways that will enable you to connect with them at multiple levels.

The bottom line of connecting with your customer is it will enable you to have a more effective sales process, garner more sales and create more loyal customers as a result of their perception that your product or service will enable them to meet their goals in life.

If you need assistance with applying this concept of identifying your Customer’s short, intermediate, and long-term goals so that you can produce greater sales and generate enhanced customer loyalty, please contact us. We can show you how do this in an easy, straightforward way by Taking Your Customer for a Ride to Their Goals.

Fountainhead Consulting Group, Inc. is an Innovation and Business Planning firm. During the past 17 years we have shown over 1,200 companies how to achieve the goals for their business by using our unique, comprehensive and systematic business planning and growth methodology, the Structure of Success™ so they can Work Less, Make More and most importantly Have Fun in Their Business. Using our Structure of Success™ methodology each month we examine one of 12 areas of a business or organization.

Office phone: (770) 642-4220

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October 2015 Newsletter – Why 90% of Businesses Fail

Why 90% of Businesses Fail

According to two landmark studies, one by McKinsey & Co. and one by Harvard Business School, 90% of business strategies that fail do so because of lack of execution. In other words, the vast majority of companies that don’t make it actually had workable game plans – they just didn’t execute their strategy properly or fully.

Well, if these organizations had reasonable blueprints, what went wrong? Incomplete or improper execution occurred.

Let me share a typical example of this. A couple of years ago Tim, an energetic man in his mid-thirties who had a company that provided on-site maintenance and repair services to their customer’s equipment, came to us for help. He had worked for another company as an employee servicing the same equipment and then he decided to go out on his own.

At first things were great. He lined up the customers, ordered the parts and took care of the repairs or maintenance in a tip-top fashion. As the company grew, he added a second crew. Then he added another one. Then another, and so forth. He ended up with 7 crews when he came to us.

Tim’s Problems

Tim told me his problems started with his first crew and then just grew bigger and more complex as he Small Business Planning in Atlanta, Georgiaexpanded. The first problem was that his crews did not have his personal commitment to doing the job right and he ended having to go out into the field many times to fix their mistakes. He thought “they know to do that”. But in fact they didn’t, because no one ever told them explicitly what to do on a service call.

The next problem was his personnel would show up at the customer site without the necessary parts to complete the job and would have to come back a second time with the needed items – thus doubling his costs. Then, he decided to implement a central “inventory” system but no one ever properly maintained it, so it became a mess. Next Tim hired an “inventory control” person and told them – here it is, it’s your baby to control. But this person ended up stealing parts from him and doing jobs on the side.

Tim was ready to pull his hair out when he came to us. He said, “What went wrong?” What happened was he got caught in the “busyness” execution syndrome, instead of executing his strategy in a “structured” manner. What do I mean?

The “Busyness” Method of Execution

Small Business Planning in Atlanta, GeorgiaFrom one standpoint, execution in an enterprise is easy; you just do it (whatever “it” is). However, in reality there are two different types or methods of “execution.” The first is to just get busy doing various activities. I call this the “busyness” method. The activities engaged in the busyness method may or may not be productive activities. As long as people are “busy” working in the company, everything seems OK. The underlying problem with the busyness method is the majority of activities are tactical actions, which are not necessarily tied to the company’s Strategic plan. This is where Tim lived.

Just like the paraphrase from Alice in Wonderland, “the faster you go, the be-hinder you get,” the busyness method can lead to activity for the sake of activity. Its mantra is “just get busy doing something.”

In the absolute, the busyness execution approach can lead to operating in the envelope of the ill-fated “tyranny of the urgent”. This is where a business spends so much of its time in crisis management that it loses sight of the big picture of what it should be trying to accomplish and thereby sees little or no progress toward its long-term goals. The business then starts to operate primarily in a reactive mode where the concept of planning becomes nothing more than figuring out the solution to today’s “crisis du jour.”

Business Leader Burnout

The bottom line of the busyness approach to execution is that it is an unstructured method that is not tied to an overall Strategic plan. This method of execution does not fully utilize systems that are intentionally tied to the business’ overall Vision and Strategy. In the end this approach can lead to endless fatigue where the owner becomes burned out with the business. The enterprise ends up being overly dependent upon the owner and they get trapped doing the same things, day after day, week after week, month after month, year after year—the perfect recipe for burnout.

Structured Execution

The second approach to execution is what I call “Structured Execution”, which uses a structured approach Small Business Planning in Atlanta, Georgiathat is based upon the overall Vision and Strategy of the business. The key to Structured Execution is that it is an intentional method of developing and executing its systems in a disciplined manner. There are three keys to Structured Execution.


The execution does not take place haphazardly but there is a definite train of thought behind each action. The visible execution is a result of an overall game plan that has been laid out clearly behind the scenes.


Structured systems have been developed, implemented, and are being monitored so that the correct actions take on a consistent basis. Actions are not left up to the individual to do as they see fit, but the steps a person or team should take to accomplish a given task have been identified beforehand and optimized to get the desired outcome on a predictable basis.


A disciplined atmosphere exists throughout the organization to ensure that once the optimized systems are in place they are followed explicitly, adherence to the systems is rewarded and deviation from them is penalized. The discipline to adhere to the systems in place is not mindless, but is an acknowledgment that the best systems are being used in order to produce the desired results.

By using a Structured approach to execution you gain the benefit of having an actual Execution Plan, instead of operating with execution by busyness approach. Therefore, the business owner does not become burned out because the business is executing based upon a defined overall strategy, not haphazardly – which in turn moves the business closer to its goals. This results in a sense of freedom for the organization’s leaders, as compared to feeling trapped by the next problem that is going to ensnare them.

Small Business Planning in Atlanta, GeorgiaBack to Tim. Over the next number of months we worked with him to implement this Structured approach, which resulted in dramatic results. He told me he was so overjoyed with his new-found freedom that he bought a vacation cabin and started spending weekends there with his family – and being totally unplugged from his company.

So, how can you start down this path? Begin by examining your operations from the perspectives of Intentionality, Systems and Discipline to determine if you need to improve the execution of your organization’s strategy. Then move forward to tie all of your operations back to your overall business Vision and Strategy.

If you need assistance with moving from the Busyness Execution model to the Structured Execution one, please contact us so we can show you how to use this concept to take your business where you want it to go.

Fountainhead Consulting Group, Inc. is an Innovation and Business Planning firm. During the past 17 years we have shown over 1,200 companies how to achieve the goals for their business by using our unique, comprehensive and systematic business planning and growth methodology, the Structure of Success™ so they can Work Less, Make More and most importantly Have Fun in Their Business. Using our Structure of Success™ methodology each month we examine one of 12 areas of a business or organization.

Office phone: (770) 642-4220