1. When you make your first sale, follow-up with customer. You could follow-up with a "thank you" email and include an advertisement for other products you sell. You could follow-up every few months.

2. You could upsell to your customers. When they're at your order page, tell them about a few extra related products you have for sale. They could just add it to their original order.

3. Tell your customers if they refer four customers to your web site, they will receive a full rebate of their purchase price. This will turn one sale into three sales.

4. When you sell a product, give your customers option of joining an affiliate program so they can make commissions selling your product. This will multiply sale you just made.

Part One of Creating Well-Defined Processes Series What if your sales increased from $100,000 to $110,000 per day and your profit increased from $10,000 to $11,000 – did you improve by 10%? The answer might shock you...

Because answer is no. No improvement occurred. In fact, your process deteriorated. Sure, revenue increased, but is this really an improvement? Let’s take a look at problem by looking at revenue and expenses.

Extra Expenses Prevent Process Improvement

Let’s examine before and after scenario. Say, in before picture, you have sales of $100,000, fixed costs of $20,000 and variable costs of $70,000. Total expenses amount to $90,000, giving you a gross profit of $10,000. In after picture, sales increase to $110,000, while variable costs rise to $77,000 in addition to $2,000 in Extra Expenses – which give you total expenses of $99,000 and a gross profit of $11,000. In after picture, remember though, fixed costs are fixed, and do not change with additional revenue. So you should get more than 10% (11.8% to be exact) profit from 10% growth.

But in order to maintain a 10% profit we have to spend $2,000 in Extra Expenses. These Extra Expenses represent your process inefficiencies. These expenses could be sales discounts, travel, overtime, or something else. The names don't really matter. What does matter is that we are not improving.

Process Evolution Enables Improvement

Improvement results from process evolution, not from an increase in scale. What’s difference? Scale increases when we hire another person, increase expenses, or purchase more assets in order to acquire or service more business. Process evolution occurs when we change process and as a result can release hidden capacity and service more business without adding any costs - and this is a form of efficiency. You can measure efficiency with formula:

Efficiency = Output / Costs

But process evolution is about more than just changing costs. It is about changing time, increasing process velocity, and getting more output from costs you already have. Cutting costs, by itself, does not evolve a process. In fact, reducing costs, without properly understanding how those costs relate to process, can actually decrease process evolution (devolution). Let's review an example…

A Cost Reduction and Procedures Training Case Study