Taking Stock | Performance Racing Industry
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Taking Stock
By John Kilroy on January 26, 2016

The first quarter of the year is an excellent time in the annual racing industry calendar to take stock of various aspects of the business, and look for areas to improve the bottom line. I'd like to use this space to share some thoughts on key issues to review.

The first issues are sales and promotion. It's been mentioned before in this column that too many racing businesses rely on their knowledge of speed, and results on the race track, as the big generator of new customers and revenue. We agree that the success of a small racing business begins here, but we've always argued that one of the fastest ways to increase revenue without padding overhead is to simply be better at selling. Look for ways to raise the average value of each sale. This may involve new, in-depth sales training. Is everyone doing a good job exploring all the issues in resolving a sale, including identifying and answering objectives? When a prospect says, "No," that's when a skilled salesperson checks in. Are necessary auxiliary products encouraged to be part of the sale? Add-on sales help with the revenue picture, and often help with customer convenience. Is everyone involved in sales ready to close? Some people new to sales fail at the end of a presentation when they can't quite ask for the order. The old saying still works, "Close early, and close often." If additional resources are needed, from books on selling to seminars, consider them as a potential investment.

When it comes to promotion, the question is, "Are you telling your story?" There's a complex, multi-dimensional media world available to you; are you taking advantage of all of it? Does the website need to be updated with current customer success stories? Are e-newsletters to customers being distributed on a regular basis, and does the open rate remain strong? Is social media a regular part of the work week when it comes to promotion—Facebook, Twitter, Instagram, YouTube? At PRI, we strongly believe in print promotion, from advertising in publications to postcards and brochures. These still grab attention in a big way, and can place your message before customers who don't know about your business. Make sure your marketing strategy includes chasing after all the customers you don't currently have! In particular, look for market segments outside of your specialty. You may have a surprising amount to sell to customers in different race vehicles than your primary market.

Finally, look for ways to lower overhead. From shipping to overtime, there can be a lot of areas in a small business where money is frittered away due to a lack of planning or discipline. Is there a more streamlined approach to completing tasks? Is there an expense category that seems to be growing every year, but has never been addressed? Here’s an area where a good accountant can be of real value. This is also an area where you should actively seek advice from your employees.

Sometimes, in the racing business, the biggest challenge has nothing to do with speed, and almost everything to do with the tough, day-to-day challenges of running a small business. Our advice is to take time now to review the business thoroughly, and plan to tune things up before the busy time hits.

About the Author
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John Kilroy is the Publisher of Performance Racing Industry magazine.
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