(or How to Double Your Profits)

Pete Williams

www.7levers.com

7 Levers of Business
(or How to Double Your Profits)

The premise is simple...

This book will show you the key steps you need to take to
double the profitability of your business.
If that doesnt motivate you to take action then nothing will.
7 Levers of Business is a tried, tested and proven
methodolog y for the specific aspects of business that are each
directly linked to your profitability. We refer to them as levers
because, if you pull on any of these elements by improving
them, even slightly, your profits will increase accordingly.

The seven levers are Traffic, Opt-Ins, Conversions, Items per

Sale, Average Sale Price, Transactions per Customer and Profit
Margin. Im going to explain them, and demonstrate how simple
incremental enhancements will double the profitability of your
business, leading to long-term success.
Thats a lot to take in through a single paragraph but dont
assume this is going to be complicated.
This book has been desig ned to support people who may be
just starting out on their entrepreneurial adventure and who
need a way of filtering out the noise surrounding business
ownership. The 7 Levers will direct your attention to the
aspects of your business you should be working on to improve
profit and generate sustainability, and show you how to analyse
every single aspect of your business processes to make sure
that theyre adding value.
This book will transform your business, whether you are an
online marketing entrepreneur, own a retail store, sell products
through an eComm store or are a tradesperson.
A re you ready?

Well, lets get going

Pete Williams

The rationale behind the 7 Levers principle

Eating your elephant

Items per Sale

Sale

22

Conversions

Convert

19

Opt-ins

Opt-ins

17

Traffic

Traffic

15

Eating

13

The principle in practice

principle

rationale

7 Levers of Business

Contents

continued...

Transactions per Customer

Putting the 7 Levers principle into practice

More About Pete Williams

About Pete

36

The 7 Levers Calculator

Calculator

34

The 7 Levers Checklist

Checklist

33

Practice

31

Profit Margin

Profit

29

Transact

26

Average Sale Price

Price

24

7 Levers of Business

Contents

Every person who visits your website or walks into your store
adds to your overall traffic. Basically, were talking about firsttime visitors or prospects.

eating

1) TRAFFIC:

principle

The 7 Levers of Business are

rationale

The 7 Levers of Business are specific aspects of business

that are each directly linked to your profitability. We refer to
them as levers because, if you pull on any of these elements
by improving them, even slightly, your profits will increase
accordingly.

7 Levers of Business

The rationale behind the

7 Levers principle

traffic

2) OPT-INS:
opt-ins
convert

This refers to individuals within your traffic who take a step

that goes beyond that of merely looking, but that comes before
the buying stage. On a website, this might refer to people who
register their email address through a lead capture form; in a
shop, this could be someone who tries on an item of clothing in
a changing room etc.

3) CONVERSIONS:
sale

This is the percentage of your opt-ins who take out their credit
card and commit to spending money.

This is a nice simple one its the average number of items

purchased by each customer.

To get this fig ure, divide the total value of all the items youve
sold in a given period by the total number of items sold in that
same period.

A fter youve subtracted the cost of making sales, whats the

overall profit margin of all sales as a percentage?

convert
sale

To be clear, Im not saying you should be able to quote, at a

moments notice, the latest precise numbers for each of these
seven levers. But you should at least make the time available
to sit down and, in a reasonable amount of time, work out your
current metrics.

opt-ins

Now, before we go any further, the first question you

should be asking yourself is, am I able to calculate each of
these elements? Unless you have a way of calculating this
information, then you have no way of k nowing if your business
is even profitable.

traffic

7) PROFIT MARGIN:

eating

On average, how often do customers make repeat purchases

(buy from you again, and again)?

principle

6) TRANSACTIONS PER CUSTOMER:

rationale
rationale

5) AVERAGE SALE PRICE:

7 Levers of Business

4) ITEMS PER SALE:

rationale

Now were going to see a practical example of just how these

seven levers can work together to double your business
profitability.

7 Levers of Business

If you dont have the necessary resources, you should install

Google A naly tics, look at your Point Of Sale software, talk
to your accountant, or do whatever you have to do to get the
numbers for each of the seven levers. Ive also provided a free
calculator to get you up and running, which is available here:
http://w w w.7leverscalculator.com, or you can use the worksheet
at the end of this ebook.

principle
eating
traffic
opt-ins
convert
sale

With thanks to Lee Turner, who was inspired to develop this for us after one of our seminars!

eating

1) TRAFFIC:

principle

Most people would answer 70%. But theyd be wrong.

Increasing all seven levers by 10% actually increases overall
profitability by 94.8% . Lets work through an example, using
very simple numbers and math. Imagine that you own a
clothing store and youre going to work out your metrics for the
last 12 months.

rationale

Im sure it wont come as any shock to you if I said that

increasing one of these levers by 10% will increase your
profitability by 10%. So, if we increase all seven levers by 10%
each, by how much will our overall profitability increase?

7 Levers of Business

The principle in practice

100,000 new, first-time, customers walked through your door

during the 12 months.
traffic

2) OPT-INS:

20 of each 100 of those who try on a garment, i.e. 4,000 of them,

go on to make a purchase. Your Conversion rate is 20%.

convert

3) CON V ERSIONS:

opt-ins

20 of each 100 of these customers, i.e. 20,000 of them, try on a

garment. Your Opt-in rate is 20%.

sale

4,000 garments in total were sold to these new customers. So

your Items per Sale is one (1).

Total sales are $400,000 ($100 4000 garments), so the

Average Sale Price is $100.

eating

You dont currently receive any repeat business, so the

Transactions per Customer is one (1).

principle
principle

6) TRANSACTIONS PER CUSTOMER:

rationale

5) AVERAGE SALE PRICE:

7 Levers of Business

4) ITEMS PER SALE:

7) PROFIT MARGIN:
traffic

A fter outgoings, your net profit is $200,000. Your overall Profit

Margin, therefore, is 50%.

opt-ins
convert
sale

2
We say you can double your profits, even though the math shows a 94% increase, because
we have yet to see any business owner increase each of the 7 levers by exactly 10%. Most
are able to achieve more than a 10% increase for each lever by putting into place some of the
simple tactics and strategies shared in the remainder of this book.

10

7 Levers of Business

rationale

Now lets look at what happens if we are able to increase

each lever by a mere 10%. A lthough the increase for each
lever is 10%, notice how your overall profitability increases
cumulatively.

1) TRAFFIC:
principle
principle

Your customers have increased by 10% to 110,000.

2) OPT-INS:

sale

One in every ten customers purchases two garments. Your

Items per Sale is now 1.1 and the total items sold is now 5,856
(i.e. 5,324 customers x 1.1 rounded down), up from 4,000. The
total number of items sold has increased by 46.4%.

convert

4) ITEMS PER SALE:

opt-ins

22 of each 100 of those who try on a garment, i.e. 5,324 of them,

go on to make a purchase, up from 4,000. Your Conversion rate
is now 22%. The number making a purchase has increased by
33.1%.

traffic

3) CON V ERSIONS:

eating

22 of each 100 of these 110,000 customers, i.e. 24,200 of them,

try on a garment, up from 20,000. Your Opt-in rate is now 22%.
The number trying on a garment has increased by 21%.

11

You have increased your sale prices by an average of 10%.

Average sale price has increased to $110. Total revenue is now
$644,160 (i.e. 5856 x $110), up from $400,000, an increase of
61%.

And theres your proof!

traffic

You have increased your overall Profit Margin from 50% to

55%. Your net profit is now $389,716.80 (i.e. 55% of $708,576),
up from $200,000, an overall increase of 94.8%.

eating

7) PROFIT MARGIN:

principle
principle

One in every 10 customers returns to make a second purchase,

so the Transactions per Customer is now 1.1. A s a result, total
revenue is now $708,576 (i.e. $644,160 x 1.1), up from $400,000,
an overall increase of 77.1%.

rationale

6) TRANSACTIONS PER CUSTOMER:

7 Levers of Business

5) AVERAGE SALE PRICE:

opt-ins
convert
sale

12

opt-ins
convert
sale

The same is true of your sales

conversion percentage. Doubling
your conversion rate is also
difficult to do, but improving it by
10% can be achieved by testing
some different headlines, or by
adding a trust seal. You could
aim to focus on just one lever per
month, for seven months. A nd at
the end of that time, youll have
almost doubled your profits.

traffic

But increasing your traffic

to 110,000, a relatively small
10% increase, is much more
achievable, perhaps by spending
a little more on Pay Per Click or
a little more time improving your
Search Engine Optimisation or
even putting a simply A-Frame
outside your retail store.

Eating
eating

The beauty of the 7 Levers principle is that the strateg y allows

you to double your profits, simply by slightly improving your
existing numbers. This is far easier than the alternative. If
youre receiving 100,000 visitors a month to your website,
setting out to double that to 200,000 is difficult.

principle

Sometimes, the most effective business strategies dont require

radical overhauls, strategic switches or huge transformations.
They simply involve taking what you already do, making a few
enhancements, and reaping the rewards.

rationale

Youve probably heard the old adage beloved of corporate

leaders, right? How do you eat an elephant? One bite at a time.
The saying may be jaded, but its sense holds true.

7 Levers of Business

Eating your elephant

13

convert
sale

258.3%

opt-ins

Wait for it

traffic

Oh, and by the way, although increasing each lever by 10%

almost doubles your profits, increasing each lever by 20%
increases your profits by

Eating
eating

Thats how powerful this process and measurement really is,

when you apply it to your business. W hat you often find is that,
when you focus on just one aspect of your business, you quick ly
notice leakages; namely areas where youre underperforming
due to something that can quick ly be fixed or improved. Before
you k now it, youve made a 10% increase and youre ready to
move on to the next lever.

principle

Weve seen so many case studies where just by measuring

their Levers, people have identified gaps, issues and forgotten
steps in their overall marketing process. This means that
even the process of calculating your initial metrics can lead
to immediate increases of ten percent in each of the 7 Levers.
This means a doubling in profits before you have even started
working on each of the elements!

rationale

The technique also really helps you to work out which activities
you should be focussing on, using the Levers as a filter to
decide whether they will bring you a true return on investment.
Every time a Magic Bullet comes across your desk, apply the
check list at the back of this ebook to it in order to establish how
much value it will generate. If it doesnt pass the check list test dont do it!

7 Levers of Business

This strateg y is so much easier than trying to fix every thing

at once. Spend a whole month on just one lever and youll be
amazed at what you can achieve.

Lets check out each of the seven levers, and learn just how we
can pull on them to increase our profit, in practice...

14

convert

Consider all of these options and then choose one or two to

focus on and make incremental improvements in your online
traffic.

opt-ins

Finally, the last in the powerhouses of online traffic generation

is affiliate marketing. Run your own affiliate programme
through Commission Junction, Click bank, ShareA Sale, Google
or LinkShare, or consider shopping aggregators, such as
Shopping.com, Google Merchant and Shopbot (for Australian
businesses).

traffic
Traffic

Google offers search ads that are location-based so you can

choose to only display to customers in your region. Use mobilespecific and banner ads through Google, Yahoo, Bing and
others to increase your traffic. Facebook advertising is also
highly effective, as is Search Engine Optimisation (SEO) to
target key words through your blog or website.

eating

Pay per click (PPC) is considered to be the best form of traffic

generation. People go to Google and ty pe in their problem to
find a supplier with a solution. You only pay when someone
clicks your advert, so keeping control of your costs is easy.

principle

Web traffic

rationale

Traffic, or leads, is all about the first interaction your customers

will have with your business. Without it, you wont make
sales. Heres a crash course in traffic - the non-negotiable
techniques you should be implementing when it comes to traffic
generation for your business.

7 Levers of Business

Lever One: Traffic

sale

15

sale

There are many options, so dont limit yourself to what youve

always done or what everyone else in your space does.
Be bold, take action and youll be amazed how easy it is to
generate the 10% traffic increase that you need to activate this
first lever.

convert

Use traditional methods of advertising including fax-outs, cold

calling, shopping docket ads, direct mail and Yellow Pages,
letterbox drops, press releases and magazine inserts, local
radio, podcasts and newspaper ads.

opt-ins

Go out, network with people and interact with your community.

Go to forums and conferences.

traffic
Traffic

Use bright hard-to-miss window sig nage on your premises.

Make an offer in F luoro Writing. Sig n up to a Groupon-style
service to generate customers, and view each one as a lead that
has the potential to become a long-term reg ular customer.

eating

Consider getting some street sig nage to entice customers

through your store. Get an A frame outside the door, make it a
chalk board, come up with comedic quotes, make bold calls to
action and daily offers. You could get your frame subsidised or
provided by a supplier.

principle

Advertising

rationale

Often ig nored these days in favour of online advertising,

foot traffic is still one of the most effective ways of attracting
people to your business. Use resources such as Google Places
to let people find you through geo-targeted, location-based
searches or mobile searches. Make your Google Places listing
comprehensive, searchable and appealing, and keep it well
maintained. A nd dont forget to try to get as many reviews as
possible to make your listing more powerful.

7 Levers of Business

Foot traffic

16

convert
sale

For online opt-ins, you can use tools like Website Optimizer,
Google A naly tics, and Zen Tester to check out how people
respond to your site. Split-testing lets you analyse different
pages, fonts and offers to see what works. If youre not
confident, get a tech-sav v y entrepreneur through Elance or
oDesk to do this for you.

Opt-ins
opt-ins

Online opportunities

traffic

You can actually use specific techniques to generate more optins from your foot traffic. Offering something for free such as a
give-away product or a trial of your service is a good place
to start. You can ask open-ended questions such as Is this the
first time youve been into our store? or W hat brings you in
today? to engage the customer and open up dialog ue. This is
much better than Can I help you? which is usually met with a
negative response. Train your sales staff to engage with every
person who drops by.

eating

Getting the most from your foot traffic

principle

Opt-ins are realised when you take a potential customer, and

shake their frame - meaning you make them change their
frame of mind and persuade them to engage with you.

rationale

Opt-ins are categorised as every lead you get from traffic

which you can turn in to a real prospect. They include
telephone queries, online requests for quotes, email
subscriptions and squeeze pages on your site. They can be
generated offsite through campaig ns on sites like LinkedIn and
Facebook, or at live events such as exhibitions and trade fairs.

7 Levers of Business

Lever Two: Opt-ins

17

sale

Dont forget, all were trying to do is increase our opt-in rate by

10%. Were not looking at going from a 3% opt-in rate to a 13%
opt-in rate. Thats a 400% increase. Were only working at going
from a 3% opt-in to a 3.3% opt-in. Simple!

convert

For phone opt-ins, you really need a great script in place. Set
up your script and check list before people call. The more
confidence you have, the better tonality you will have, and the
better chance of increasing these opt-ins by 10%.

Opt-ins
opt-ins

Engaging customers who call

traffic

You only need the name and email address of your online
visitors. Services like Aweber and MailChimp will automatically
grab the persons location and country code. Dont bombard
your clients with requests for needless information.

eating

Keep it short and sweet

principle

Have a really strong A bout and Contact page on your site.

Consider using your country f lag to show who you are and
where youre based. Think about using video on your site to
build trust and rapport with your customers, so they can meet
with you face-to-face.

rationale

For each page on your site, make sure you g uide your customer
to get the best response and give a clear call to action for the
outcome you desire. For example, if you want a visitor to call
you after going online, put the phone number on every single
page of your website. If you want them to subscribe, give them
a bright button to do just that.

7 Levers of Business

One page equals one action

18

A sk happy clients to say a few words about your service, and

publish them so they are visible on your site or shop window.

Convert
convert

Offer your clients a range of payment options to encourage

sales. Consider staggered payments, lease options, monthly
options, rentals or deposits to help your customers. Even if
someone doesnt have the cash to make an instant purchase,
conversions come when you offer alternatives to make things
easier.

opt-ins

Payment options

traffic

Guarantees increase conversion by providing firm

commitments. Offer a money-back g uarantee and honour it. You
may have a legal obligation to do this any way but publicise it
clearly to encourage faith in your products and services.

eating

Guarantees

principle

Testimonials

rationale

Conversions happen when you take leads and prospects

generated by the first two levers, and turn them into customers
and clients. There are some really simple techniques to achieve
this. Lets look at the fundamentals

7 Levers of Business

Lever Three: Conversions

sale

19

Convert
convert
sale

Sometimes, simply asking for the sale will make you a

conversion. Tools like Aweber, MailChimp and Constant
Contact make it very easy to set up autoresponder sequences
of emails that automatically go to new subscribers on a pre-set
schedule.

opt-ins

Ask for the sale

traffic

Potential customers are really swayed by the streng th of a

positive and trusted brand. Brand streng th comes from a
number of factors, but accreditation, awards, certificates and
training all provide reassurance that your firm can be trusted
to do a great job. Make all of your accolades highly visible put them up in your store, show the logos on your website, and
demonstrate your abilities and streng ths.

eating

Establish your market position

principle

This technique reassures your customers that they can try

out your service without risk. If youre confident that you are
providing a great product or service, youll make conversions
as your customers grow to like what you offer and make up
their minds to buy.

rationale

Free trials are a sure-fire way of upping conversion rates

because, by the time your customer has got to k now and love
your product or service, they wont want to do without it. I call
this the Puppy Dog Close. A father and his daughter went to
a pet shop and were thinking about buying a dog, but werent
sure. The store owner said, Look, take him home for a week
for free and, if you want to, you can bring him back. Of course,
the puppy becomes part of the family and the pet store owner
makes a sale.

7 Levers of Business

Free trials

20

eating

Finally, make it easy for your customers to purchase from

you. Be on hand through live chat online, respond quick ly
to queries, and have big clear calls to action that make the
purchase process simple.

principle

Make it easy

rationale

Customers can be convinced to buy if you limit your supply and

demonstrate that what you have on offer is only available for a
short time, or limited to a certain number of clients. The fewer
things there are in the world, the more value they hold, so use
this philosophy to increase conversion rates.

7 Levers of Business

Limit supply

traffic
opt-ins
Convert
convert
sale

21

convert

Rather than selling items in isolation, think about ways you

can bundle them up and make them more appealing as a
package. Create packages based around predefined segments,
incorporate slow moving stock and encourage package
selection over the single product. Refills and consumables
are both items that you can turn in to great packages to boost
items per sale opportunities.

opt-ins

Create package deals

traffic

Offer customers additional items that relate to their core

purchases. The cheaper item should always be offered second
and it should be something thats complimentary like shoe
cleaner with shoes or mascara with blusher. McDonalds,
would you like fries with that? is a perfect add-on thats part
of their sales script.

eating

Offer add-ons

principle

Theres more to this lever than simply selling more to increase

revenue; if you have items in stock that arent selling, youve
got cash tied up in the business that you cant use elsewhere.
Similarly, the more inventory you sell, the more negotiating
power you have in Lever 7 when you focus on your Margins.

rationale

To pull your Items Per Sale Lever, what youre looking to do

is to get every tenth customer to purchase an additional item.
W hen this happens, you increase your items per sale by 10%,
gaining an overall transaction average of 1.1 items.

7 Levers of Business

Lever Four: Items per sale

Sale
sale

22

These are items that you can sell at a small loss, or even just
to break even, to encourage people to visit your business and
make additional purchases.

Sale
sale

Remember, all we need is just 1 person in every 10 to buy more

than 1 item and weve hit the 10% target for this lever.

convert

These are small, cheap, impulse purchases that customers

make at the counter, or as they pass through your shopping
cart online. They can be any thing that a customer will buy
impulsively for a small price, to boost your revenue through
incremental sales.

opt-ins

Set up point of sale offers

traffic

Establish your monthly loss leaders

eating

Look at your product suite and see how you can enhance each
item. Offer extended warranties, bulk-purchase deals, support
packages, maintenance packages or any other enhancement
that will enable you to increase sales through each purchase
your customer makes.

principle

Consider enhancements to products and

services

rationale

Use questionnaires to quiz your customers about what they

need, want or value, and then use this consultative selling
approach to identify ways you can offer additional items per
sale.

7 Levers of Business

Ask your customers to direct you

23

Calculator

If you put your prices up by 10% without changing any thing,

whats the worst that could happen? If you give an exemplary
service, you may lose a couple of clients, but you could still be
better off overall. Even if you then discount your price again
through special offers, youre still no worse off than you were.

Checklist

Increase your prices

Practice

Value can be added through an enhanced sales service,

expertise, k nowledge, advice given prior to purchase, brand
streng th, g uarantees and even things such as how your product
is packaged, dispatched or presented.

Profit

This means looking at all of your products and services in

terms of value, not price, establishing exactly what benefit your
customer gets for their investment and then communicating that
effectively.

Transact

Instead youre going to come at this from the opposite angle.

How can you create more value in the eyes of the customer so
that you can justify INCR E A SING your prices?

Price

To achieve an enhanced average sale price youre looking at

increasing the selling price of each single item to gain more
revenue from every single sale. There are many ways to do
this, but offering a discount is not one of them. Your aim is to
increase the average sale price, not decrease it.

7 Levers of Business

Lever Five: Average Sale Price

About Pete

24

7 Levers of Business

Offer exclusivity
Customers love to feel that they are getting a differentiated
service. Offer exclusive, limited specials that come at a higher
price. Speak to your suppliers to see what they can offer to
support you to make the change.

Price

Maximise the Thud Factor

Calculator
About Pete

A re you valuing yourself properly? Make sure you price

yourself fairly. Show all of your costs and explain them so
you can compete successfully on product quality, range and
service. Youll attract a higher class of client which means fewer
hassles and easier sales.

Checklist

Value yourself and your business

Practice

Establish your expertise and use it to justify your increased

prices as a market leader. You can do this by writing a book
and publishing it on CreateSpace or K indle, or by arranging to
speak at events and seminars.

Profit

Be a market leader

Transact

This is the moment when your product or service lands on your

customers desk or doormat and they realise you have given a
really comprehensive service. More is often associated with
better so, if you increase the number of items or add more
variety to a package, youll increase the perception of value.
Online businesses, for example, can supplement an ebook
with videos, audio transcripts and printable check lists to
maximise perceived value and gain more of a thud factor.

You are worth it. Your business is worth it. Be confident.

25

Checklist
Calculator

Each product line or service you provide can have a series of

funnels, allowing you to segment your client base and ask for
additional transactions.

Practice

Its important to develop a schedule of automated marketing

using tools such as Aweber, MailChimp or Constant Contact to
remind your customers to transact again. Your schedule could
include SMS reminders, emails, direct mail or sales calls. Once
a customer has made an initial purchase, get them to sig n up to
ongoing communications that identify, for example, when their
product has run out, and that remind them to reorder.

Profit

Follow-up marketing

Transact

A ll we need to do is persuade one in ten customers to buy from

us twice in a given period of time. We can do this through a
number of mechanisms including direct response, follow-up
marketing, implied commitment and consistency through loyal
reward programmes, forced transactions and automated followups.

Price

In essence, transactions per customer relates to increasing the

amount of times that any person buys from you in a particular
time period. The key to increasing your transactions lies in
automating the process so you can set it up and then forget
about it.

7 Levers of Business

Lever Six: Transactions Per Customer

Information marketing
About Pete

No matter what sector you work in, you can set up information
marketing to encourage repeat transactions. Your articles
should be informative and helpful but always have a prompt to
make it easy for your customers to engage in repeat business.

26

7 Levers of Business

Training your staff

Get your sales team to make scheduled follow-up calls to
customers to check how they are getting on, and suggest
further products at set times.

Transact

By becoming and identifying yourself as an expert in your

field you can provide your customers with informative
communications that provide advice on what products they
may benefit from at set times. Boost the effectiveness of this
by providing a special offer to people who take you up on the
advice.

Price

Offers and education

Profit

The marketing funnel

Calculator
About Pete

Use community membership areas, forums, user groups,

associations and elite memberships to provide information and
support which always link back to your sales stream.

Checklist

Providing ongoing support and

membership forums

Practice

W hen a customer buys a particular product, place them into a

segmented marketing funnel that provides tailored support and
messages to encourage repeat sales. Set up loyalty and reward
programmes to track data and provide incentives for repeat
custom. Youre looking to establish an ongoing automated
stream of backend income, continually purchased from you on a
reg ular basis.

27

7 Levers of Business

Repeat Billing
Recurring payments is one of the fastest ways to pull this lever.
A llow your customers the option of sig ning up to ongoing
services that require automated payments at set intervals.

Price
Transact
Profit
Practice
Checklist
Calculator
About Pete

28

About Pete

Consider additional services that are cheap to produce but can

still be sold at a high price. K nowledge and information always
have huge margin potential, so write ebooks and g uides,
provide training, and develop complementary products that
have a low outlay but a high value to your customers.

Calculator

Choose what you sell carefully. Opt for high-margin products

and services and train your sales staff to push these to your
customers. Provide incentives and commission when highmargin items are sold.

Checklist

Improve your product lines

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Offer a joint promotion where you help them sell more items,
or offer to help them move slow-selling stock on a consig nment
basis. Consider asking for a rebate once youve achieved a
certain volume of sales, or negotiate a discount for reg ular
custom. Build up positive supplier relationships where you can
offer mutual benefits for your customers, and then maintain
them.

Profit

Make sure you are getting the best deal when you source from
your suppliers. Its always worth negotiating to get an enhanced
rate and you can do this in a number of ways.

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Negotiate with suppliers

Price

The final Lever relates to how much profit you make from
every sale that takes place. Your goal here is to increase the
difference between the cost of producing your product and
the price at which you sell it. Weve already addressed, with
previous levers, how to increase the sale price, so here well
focus on reducing production costs.

7 Levers of Business

Lever Seven: Profit Margin

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7 Levers of Business

Stop discounting
Seriously, stop discounting your products and services. Dont
offer deals to your clients unless they ask and then only if you
feel that you are investing in a long-term lucrative relationship.

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Checklist

Consider entering in to partnerships with other firms that

can provide you with an enhanced product or service, with
increased margins. Share marketing, share k nowledge, share
customers and enhance your products to sell them at a higher
rate.

Profit

Partnerships

Transact

Take a look at how you can reduce your outgoings. W hile

this doesnt directly affect your 10% margin per sale, it can
sig nificantly improve your overall profit. Work from home,
share offices, have virtual staff, negotiate deals with utility
suppliers - whatever it takes to cut down expenditure and make
your products generate income which is not used up needlessly
elsewhere.

Price

Reduce expenditure

Calculator
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Transact
Profit

Dont forget to refer to the 7 Levers calculator at the end of

the eBook also, to gain a really clear view of how just a few
changes in each of the seven areas can dramatically increase
your profit!

Price

Now that you k now each of the seven Levers and how to both
measure and manage them, you have pretty much all you need
to start doubling the profit for your business and seeing some
real returns from your activities. Ive put a f low diagram on
the next page so you can check every activity you undertake
against each of the Levers, and verify that new initiatives will
increase revenue by enhancing one of the seven categories.

7 Levers of Business

Putting the 7 Levers principle

into practice

Magic Bullets and the 7 Levers principle

Calculator
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One of the true benefits of the 7 Levers principle is that it

provides a clear, foolproof way of assessing these magic
bullets to determine just how useful they may be, or how much
profit they may lead to. By having a strong check list in place
to measure each potential new activity, youre able to dodge
the bullets that will detract from your overall business strateg y
and make sure that all of your business activities are targeted,
profit-driven, and focused on long-term success.

Checklist

Weve all been in a situation where weve been drawn to an

idea, application, software package or concept that has looked
really useful, persuading us to pour time, effort and cash in
to developing it...only to find that, when weve invested in the
idea, it actually brings nothing of value to our business.

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If youve followed my blog and principles for a while, youll

often have heard me refer to the idea of Magic Bullets - the
shiny, enticing opportunities that drop on to our desks all the
time and that can distract us from our strategic direction and
purpose.

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7 Levers of Business

The power of the 7 Levers framework for

your business
Its impossible to stress just how much the 7 Levers principle
can transform your approach to business, and increase your
profitability, productivity and focus.

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Its time to work smarter, not harder. You now have every thing
you need to transform your business, and double your profit!

Profit

The 7 Levers framework prevents wasted energ y, targets

your approach, and lets you double your profit - all for just
incremental improvements of just 10% in each category.

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The 7 Levers let you focus on all the different drivers of

your business, every day. Every single thing you do for your
business can be measured for effort, weighed up for return on
investment, and put into context against the framework.

Price

The beauty of the system is that it takes just a few minutes

each day to act on each lever, boosting profit through using the
framework.

Checklist
Calculator
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32

7 Levers of Business

The 7 Levers Checklist

START

Price

Business activity

Traffic

Transact

Opt-Ins

Youre good
to go!

Average Sale Price

STOP.

Profit Margin

Reassess why
you want to
do the activity.

About Pete

NO

Calculator

Transactions Per
Customer

Checklist
Checklist

YES

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Great!

Items Per Sale

Profit

Conversions

Does the activity increase

one of the following
7 Levers?

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7 Levers of Business

The 7 Levers calculator

Complete the fields below to work out just how much profit you
will make by improving by just ten percent in each lever:

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Opt-In Rate (%)

Price

Traf fic

Conversions (%)
Profit

Average Sale Price

About Pete

Total (%)

Calculator
Calculator

Profit Margin (%)

Checklist

Average Customer Transaction

Practice

Average Items Per Sale

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Transact
Profit

Traffic relates to the traffic that your business gets, whether

visitors to your website, customers to your retail store or people
responding to a direct mail piece. It is the first level enquiry.

Price

Once you have your numbers, enter them in the fields opposite
and play around to see how changing just one of these by a
relatively small percentage can make a big difference to your
business.

7 Levers of Business

To implement the 7 levers on your business you must k now your

numbers. These numbers relate to traffic, opt-ins, conversions,
average sale price, average items per sale, average number
of transactions per customer and your profit margins. To make
this work you will need to k now these numbers no matter how
hard it is to see them. Once you have them, it will give you the
ability to make better decisions about your business and what
to focus on to improve it.

Opt-In Rate is measured every time someone opts in to your

Conversions are the % of your prospects that turn into

Practice

newsletter online, requests a quote, or interacts positively after

walking into your store.

customers.

spend, when they purchase from you for the very first time.

Average Items Per Sale refers to how much a customer

Checklist

Average Sale Price relates to how much on average customers

purchases from you per transaction.

many times your customers buy from you in a certain period.

Calculator
Calculator

Average Transactions Per Customer are calculated by how

Profit Margin relates to how much you make from every sale.

About Pete

35

7 Levers of Business

More About Pete Williams

Pete Williams is an entrepreneur, author, and marketer from
Melbourne, Australia.

Podcast: http://w w w.PreneurMedia.tv

Checklist

Blog: http://w w w.PreneurMarketing.com

Practice

You can interact and get more of Pete online at:

Profit

Lots of other people think hes pretty good too! Hes been
announced as the Global Runner-Up in the JCI Creative Young
Entrepreneur Awards, been a Southern Region Finalist in the
Ernst & Young Entrepreneur of the Year Program, and was
member of SmartCompanys Top 30 Under 30.

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Since then, hes done some cool stuff like write the international
smash hit How to Turn Your Million-Dollar Idea Into a Reality
and hes created a bunch of companies including Infiniti
Telecommunications, On Hold Advertising, Simply Headsets
and Preneur Group.

Price

Before being honored Australias R ichard Branson in media

publications all over the continent, Pete was just 21 years
old when he sold Australias version of Yankee Stadium, The
Melbourne Cricket Ground For Under $500!

Twitter: http://w w w.Twitter.com/preneur

Calculator

LinkedIn: http://w w w.linkedin.com/in /preneurmarketing

About Pete

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