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Author: Daren Burbridge

How to succeed working from home

Copyright © 2009 Daren Burbridge

With the current situation of individuals finances many of us are looking for ways to make an extra few pounds in our spare time. However with very little knowledge about selling or how to gain customers the majority of work from home start ups fail, which in turn provides a bad name for the industry or business involved.

Amazing I believe that 80% of work from home start ups fail because from a lack of understanding to attract customers to a business and mainly failure to achieve their primary goal after two to three months. In a complete reversal of this when individuals start a work from home business with the correct information 79% of work from home seekers succeed in their goal to earn the extra income that they are looking for. This complete reverse is simple to achieve with support, guidance and teaching of some basic understandings of a work from home business; how to achieve end financial goals, sales and marketing principles, how to market, failure and how to gain from it, Creating a USP.

However these basic understandings will not be achieved unless the individual has a desire and a willingness to achieve their own personal goals. Every individual has a different reason for wanting to earn and extra income from home, whilst running a full time job; if you asked 100 individuals why they want to earn extra money from home you would more than likely get 100 different answers. The key is to have a goal and work backwards from this goal so that it can be achieved and success is born from achievement.

How often do I hear "I want to earn £1000 per month" or "£100 per week would be what I am looking for"? Virtually every time I speak to a potential new customer. So how do you achieve this goal, well the equation is very simple;

Target income = Average profit per item X number of sales

For example if your average profit per product if £5 and you want to achieve £100 per week your equation would look like this

£100 per week = £5 * 20 customers

So now we understand that we need 20 customers to buy a week to achieve our primary goal; We have already begun to work backwards from our primary goal and we can now move from our primary goal to our new secondary goal which is not money related but target related; that is now to achieve a set number of customers buying from us each week.

So how do we get 50 customers buying from us every week? There are three main ways that we can do this ;

1. Get new customers
2. Sell more to existing customers
3. Sell more often to existing customers

I bet you are sat there thinking well the easiest way is to get new customers; Well you are not alone, many business owners within the home working market focus their strategy on getting new customers as their only form of marketing. This is probably the most costly and time consuming way of building your business! Building business with your existing customers by creating ways for them to buy more often is much less costly and much quicker!

Let me introduce you to a rule that when applied will astound you not just for a work from home business but for many other scenarios too. It is the 80/20 rule. The rule is widely respected within the sales and marketing arena. Let me give you some examples of this;

* 80% of your customers will provide you with 20% of your business
* 20% of your customers will provide you with 80% of your business
* 20% of your customers will buy from you each month

These figures are not actual figures but guides that will help you! Why am I telling you this, I can hear you saying. Well this information will help you to understand how to put together a long term strategy. Your residual income will be made up of the number of customers you have, multiplied by their average spend by how often they buy;

Estimated income(Target income) = Customers X Value X Frequency

EG: If you have 100 customers; 20 of these customers(probably not the same 20 each month) will spend £2 per month profit, 80 of them will spend £2 per year, giving you a residual income of; 20(customers) X £2(Profit) X 12(Orders each) = £480 PLUS 80(customers) X £2(Profit) X 1(Orders each) = £160 TOTAL INCOME Per annum £640 or £12.21 per week

So we now know that 100 customers will return us an estimated profit of a little over £12 per week based on a profit of £2 per avearge sale, we can now take this information and work out how many customers we need to provide us with our £100 per week primary goal;

Target income / Total income * Customers = Total Customers

So in this example;

£100(Target income) / £12.21(Total income from 100 customers) * 100(number of customers) = 819 customers required to make us £100 per week.

Now remember that this is not an exact science and that these figure will vary; however this will mean that you can work out how quickly you can achieve your goal realistically, for example if you said to yourself I am going to get one customer per day, it will take you nearly three years (819 days) to achieve your goal based on £2 average profit per item sold. However if you said I am going to get 4 customers per day you would achieve your goal in around six and a half months.

What does all this mean, well the primary reason that people fail when they run a work from home business is that they fail to achieve their primary goal, which is normal a financial goal, by removing this and setting a secondary goal(customers) you can sense achievement of your primary goal.

Now remember this is information is only going to help you in understand how to achieve end financial goals, you still need to understand and set goals for how you are going to achieve the required number of customers that you need to fulfill your work from home financial goals.

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