How Small Improvements Can Exponentially Grow Your Profits
I want to share with you a simple but amazingly powerful observation I learned years ago about the underlying math that makes your business work. It’s called the five drivers. I share this so you can focus your efforts on the things that will have the most impact for you. And to be honest, I don’t care if any of my competitors do this, because I believe in helping businesses be successful. So game on, competition!
Watch: I Explain the 5 Drivers
Recap – The 5 Drivers
For you skimmers out there, let me recap what I cover in the video.
What Are the Five Drivers?
If you want to grow your business, you have to start looking at the underlying drivers behind successful growth:
- Average transaction size
- Number of purchases
- Profit margin
Improve any one of those, even while keeping the others constant, and you’ll improve your profit. Simple as pie, right?
Here’s another way to look at it:
The Multiplicative Effect
What’s really cool about the 5 drivers is that these are all multiplicative. A 10% increase in any one of them doesn’t just result in a 10% or even a 50% increase to profit—it can be literally hundreds of percentage points of growth. Think of that! If you improve each of these numbers just 10%, you could completely change your life as a business owner.
The 5 Drivers Series
I’ll be publishing a post for each individual driver, sharing tried-and-true ideas and thought-starters you can steal and implement in your business right away.