Value, Profit, and YOUR Small Business — Part 1 guest post by Bob Burg

We’re super excited to have Bob Burg, best selling author and speaker come by for a two-part post on value and profit. Here’s part one.

business hand shake

As a small business owner, you look for the edge, constantly and continually. After all, you’re working within the context of a difficult economy and to say otherwise would be comparable to an ostrich burying their head in the sand. The good news is that, through proper focus and understanding of what makes for success, you can stand out from the crowd and position yourself for success. In other words, while you cannot control the economy, you certainly can control your economy.

In his book, The Secret of Selling Anything, Harry Browne wrote: “Profit is a reward for satisfying the desire of someone else.”

Sounds pretty simple, doesn’t it? And, it is. But it’s something many don’t realize. Think about it, though. It all comes down to the fact that if one desires to have a healthy and profitable business, he or she must please the marketplace of consumers they serve.

This is accomplished providing value.

An Overused Term? Perhaps. But, For Good Reason

Keep this law of economics in mind. It is immutable: “People will exchange their money only for what they believe is of greater value than the money they are exchanging it for.” Otherwise, why would they make that exchange? In seeking their own happiness, no one is going to willingly give up something they have in exchange for something less. And, that’s exactly how it should be.

And, for you, this is where “value” comes into play. Unlike price, which is a set dollar amount, value is the relative worth or desirability of a “thing” to the end user or beholder. In other words, what is it about this thing (your product or service) that brings so much worth that the prospect will exchange their money for it and be glad they did, while you make a healthy profit.

If you are an accountant, while you charged $1000 dollars to do Mary’s tax returns, you saved her $5000, you saved her countless hours of time and aggravation and provided her with the peace of mind of knowing it was done correctly. As you can see, the value you provided, both concrete and intangible, well exceed the “price” you charged (so she’s thrilled!) and you made a very healthy profit.

Thus, as Harry Browne’s above quote implies, only those business people who are focused on pleasing the consumer will have that healthy and sustainably profitable business.

Harry’s secret of sales and business success was:

“Find out what people want and help them get it!”

And, to do this, the successful small business owner must recognize that — when it comes right down to it — it’s all about the consumer, not the salesperson.

In Part Two, we’ll look at a key element in the process.

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bob burgBob Burg is coauthor (with John David Mann) of the International bestseller, The Go-Giver. Published in 22 languages, it has sold 300,000 copies and, along with its follow-up book, Go-Givers Sell More, is used as a training manual for numerous companies and organizations. To download Chapter One visit: http://www.burg.com.

 

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  • Sarah Jocson

    Great article! All businesses need to attach themselves to successful brands.

  • http://www.enmast.com/ Brad Farris

    Sarah;

    Glad you enjoyed it. Bob Burg has been dishing out wisdom for over a decade — apparently he’s got lot of it to spare.

    Brad

  • http://www.bizsugar.com/ Heather Stone

    Hi Bob,
    “Find out what people want and help them get it!” A great business strategy to be sure. Thanks for the post and thanks to Devan Perine for sharing it with the BizSugar community. The big question is, of course, how do you find out? I suspect your next post will deal with this topic. But right now, I’m wondering if you or Brad could give some simple suggestions to our members over in the BizSugar comment section of what you can do to tap into what your customers really want. Thanks!

  • http://www.enmast.com/ Brad Farris

    Heather, thanks for your kind comment. We will have the other half of Bob’s advice up today (Thurs). I’m looking forward to it as well!

  • http://www.enmast.com/ Brad Farris

    Sarah;

    I also got a message from Bob on Twitter: He’s not able to log-in, but appreciated your kind words!

  • Harry

    Nice article. I especially like your emphasis on VALUE. Too many business owners lose sight of this when they focus on what is costs to make the product and what margin they need to sell at to arrive at the price. Unfortunately, that’s not how customers see it. You have to put yourself in customers’ shoes to come up with the value proposition that will make them open their purses.

  • http://www.enmast.com/ Brad Farris

    Harry;

    If it’s not a value to the customer — it’s not a value! Don’t miss Bob’s part 2 that just went up today for more on that.