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5 Drivers: The Simple Math at the Core of Your Business


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:

  1. Leads
  2. Conversion
  3. Average transaction size
  4. Number of purchases
  5. 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:

5 drivers formula skyhook

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.

Part 1 – 5 Drivers: The Simple Math at the Core of Your Business

Part 2 – 5 Drivers: Leads

Part 3 – 5 Drivers: Conversion Rate

Part 4 – 5 Drivers: Average Dollar Sale

Part 5 – 5 Drivers: Number of Transactions