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Plan for Repeat Business

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Dec 12, 2012 08:47 EDT

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Plan for Repeat Business
A loyal customer base is key to building a successful startup
By Brad Sugars
Startup Basics - Entrepreneur.com
 
If there is one mantra you should adopt now and plan for in your business, it should be that repeat business equals profit.

The reality of business is that it costs anywhere from six to eight times as much to generate a new customer as it does to sell to an existing customer. And profits only start to accrue from new customers after a second, third or even fourth purchase.

So how can you plan for repeat business in your startup?

First, you must determine upfront the cost of "buying" a new customer for your business. What do I mean by "buying" a customer?
Exactly that.
Instead of guessing how much to spend on sales and marketing, determine how much you are willing to spend to "buy" a customer. This will give you a more concrete way to create your budgets for marketing, customer appreciation strategies and referral programs.
So how do you determine the acquisition cost of getting a customer?
(Click on the link above to read the whole article)

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Details

Plan for Repeat Business

Relevant Subject and Topic
Sales and Customer Service

Types
Article
Tip or Suggestion

Features
Informative
Competitive

Format
Blog
Webpage

Copyright Owner
Brad Sugars
Entrepreneur.com

Most Suitable For Use By
Instructors, Facilitators, Entrepreneurs

Age Appropriateness
Adult(19+)

Grade Appropriateness
Postsecondary, Graduate, Adult General, Professional

Geographic Suitability
All or Non-Specific

Language
English

Version History

Date Edited
Notes
Dec 12, 2012 08:47 EDT
moved