Your Sales Breakpoint Tells You How to Grow

Understanding your breakpoint will help you learn which tasks and skills you need to master to grow your company

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Tcollaboration with the lifestyle brand Mitchell Black. here are two business models for window treatment companies: personal home business and retail managed business. With a personal home business, you sell and decorate yourself. It can literally be run from more. Current customers will never notice 5 percent higher pricing. You deserve it, so charge it. Strive for two customers a week. Marketing is as important as your home and has no employees and very low overhead. The design, sewing and operations. To grow, you have to invest in alternative is a retail managed business, in which you operate yourself. Marketing is just that—an investment that requires a retail store, manage an office and employ a decorating staff. both time and money. Past customers have good potential to become customers again, so email them or send postcards. SeAre you happy with your current level of income or business? lect a high-income neighborhood nearby and do outreach. Be Your choice is always to love your level—or change. Your break- sure everyone knows who you are and what you sell. Stop at point is a number that tells what you should do to grow de- homes with windows in need of coverings and real estate signs. pending on whether you are below or above that number. Un- They are high-potential clients. Winners spend up to $300 to derstanding your breakpoint will tell which tasks you need to get a new customer. Make sure you budget accordingly. master. Get some help. Now is the time to begin bringing people into Change is never easy. But doing it brings personal pride and your business, even if it’s just on a contract basis. Unload bookthe potential for better income. If you want to grow, here are keeping and installation. Get sewing help from craftspeople you breakpoints to guide you. trust. Hire a contract installer.

Personal Home Business Breakpoint: $100,000

Are you a new interior design professional, a drapery workroom that has hit the wall or an installer who is working too much for too little money? Are you ready to decrease stress and stop limiting your potential? Here are some actions to take depending on your current annual sales.

IF YOUR SALES ARE BELOW $100,000 PER YEAR IF YOUR SALES ARE ABOVE $100,000 PER YEAR

Set a goal for a higher gross margin to achieve a higher net

profit. Your net income should be 25 to 30 percent of sales. If not, raise your pricing! Work with a mentor and they will show you how. You need a good selling system to raise prices and not lose customers.

Make strategic hires. Start when you have about two customers a week. Plan on having your part-time assistant spend two hours

a day working with you. The second hire should be a housekeeper. Get someone else to clean your home while you plan marketing.

Retail Managed Business Breakpoint: $1,000,000

You are doing something right if your sales are over $500,000. You probably have a store. Yet your retail store may not yield a higher net profit until you reach higher sales levels. Here are actions to take and things to think about at different breakpoint levels.

IF YOUR SALES ARE BELOW $1,000,000 PER YEAR

Acknowledge reality. Sales above $500,000 and below $1,000,000 place you at the most difficult level in our industry. You must both sell and manage. Your office person may process orders. Your installer may put up products. But when you look in the mirror, you know, “It’s my job to keep the cash coming in.”

At this stage, you’re negotiating a minefield of changes and challenges. The land mines can blow your limbs off and send you scurrying back to the ranks of smaller businesses with no staff. Acknowledge that these challenges exist and prepare yourself to face them. Steps to do that include building cash reserves and educating yourself on what it takes to grow to the next level.

Find a good inside person. This is the most important position to fill. It is not easy, and you may go through several to find the right person. Ask others that have done it how to master the tough techniques. But to move up, you must become a manager.

IF YOUR SALES ARE ABOVE $1,000,000 PER YEAR

Know the sweet spot. Many business owners find it at $1.2 to $1.5 million in sales. One million dollars is not quite enough to cover fixed costs and make a healthy net profit.

Staff accordingly. This is critical. You probably have two full-time decorators and sell some jobs yourself to old friends and special clients.

Ask yourself: “How high do you want to go?” Some owners earn over $300,000 a year with less than $1.5 million in sales. Do you really need to keep growing your business? Or should you focus on improving profit and keep the business where it is? There’s no right or wrong answer, but it is important to understand your options. Making the jump from $1.5 million to $2 million or more is difficult. It means facing and mastering a new set of challenges. Ask yourself: “Is your desire fire worth the change pain?”

Whatever your sales level, your business breakpoint will guide how you plan for the next level. You are talented and experienced. You will make the right decision for you! z

Steven C. Bursten is the CEO of Exciting Windows!, a national network of 40 independent window fashions retailers and 100 decorating consultants. He is also the inventor of Shop At Home window treatment sale and has over a half-century of guiding hundreds of new and experienced business owners to sales and profit growth. ExcitingWindows.com Facebook: ExcitingWindows Twitter: ExcitingWindows