Mike’s Home Service

Chaudhary, Meeru
Marketing 111- Prof. D Gagliardi

Mike’s Home Service

Mike’s sales goal is $20,000 annually. According to the information given, Mike is not able to reach his sales goal. My calculations and reasons are as follows:

A) During the year Mike has the months of April, May, September, and October 2010 (4 months =18 weeks) where he is busy. He makes $100-$120 dollars a day, working 10 hours a day (So we use the average= $110) Realistically speaking we cannot work 70 hours a week for 18 weeks, our bodies do not have that capacity but we can still have a hypothetical calculation for 7 days a week as the high end of the range. So we would have a range where we calculate the amount of sales that Mike can make working 5 days a week (Scenario 1) and 7 days a week (Scenario 2). We are then left with the 34 weeks of normal(slow) business, which we would add to both ends of the calculations.

B) Calculations:

-18 weeks out of 52 are busy, 34 weeks have normal business.

Scenario 1: 

Normal business: $100 a week x 34 weeks= $3,400
Busy Week: 18 weeks x 5 days in a week= 90 days                 =$13,300 [pic 1][pic 2][pic 3]

90 days x $110 sales per day= $9,900

Scenario 2:

Normal business: $100 a week x 34 weeks= $3,400
Busy Week: 18 weeks x 7 days in a week=126 days                 =$17,260 [pic 4][pic 5][pic 6]

126 days x $110 sales per day= $13,860         

Ways for Mike to Improve His Business

• Keep abreast of trends in the industry by joining professional associations, attending conferences, and reading newsletters and magazines. Take classes and attend training to learn from others in the field (This can be done online).
• Focus on helping people, and the business will follow. If you are providing added value to your customers and helping them out, it will inevitably provide cash to finance your growth ( pushing sales, best example is Vistaprint online). If someone likes you, they're more likely to buy from you, regardless of the deal you're offering
• What makes you different? Understanding and communicating this can really boost sales, and shift the focus away from price alone (Mike doesn’t make customers wait 2 weeks like Balcom).
• Here’s another exercise that can ride on the coattails of your customer ranking research. Once you’ve identified your loyal and top-spending customers, think of ways to offer them more. (Rewards points, VIP programs that offer incentives)
• Identify the client profiles that have proven to be your most satisfied. These are the ones who are referring your business to friends and neighbors. Do they represent a particular demographic or live in a certain neighborhood?
• Get to know your competition and how to sell against them (easier for Mike to do since he has experience working with Balcom) If you lost out to a competitor on a deal, be bold and ask the prospect why they chose to do business with them and not you.
• One should also keep in mind the profit margin of our competitors and we can attract other customers by providing less costly services to them (without being at a loss).
• Giving the impression that, by passing on a sale, your customer is missing a special offer or a limited-time deal is one of the oldest, most effective tricks in the book for getting reluctant customers off the fence. To do this, try to call attention to certain deals that won't be offered forever or certain products that are almost out of stock and encourage customers to "jump" on these opportunities.
• Distribute free samples to customers. In Mike’s case maybe a carpet cleaning spray/tool along with a purchase.