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Top 4 Reasons
Businesses
Fail to Grow
Trailer Version
The reality…

 •       Only 5% of
         companies
         will ever
         reach $1
         million in
         annual sales
 •       Only .08% will
         ever reach $5
         million

Source: Chet Holmes author of The Ultimate Sales Machine: Census Bureau


                                                      © Copyright - 2010   2
Business stagnancy in the U.S.

• Only 30% of businesses
  survive and only 10%
  of these businesses
                                                                                    Where are
  grow
                                                                                      you?


• This means, 90% of all
  businesses become
  stagnant!

Source: Office of Advocacy of the U.S. Small Business Administration adapted from
the Bureau of the Census Economic Survey


                                                         © Copyright - 2010               3
A common theme

•      60% of businesses that
       became stagnant listed
       poor marketing as a critical
       contributor
•      50% of these businesses
       rated themselves “low” or
       “very low” in their
       marketing skills

SOURCES: U.S. SMALL BUSINESS CONTRACT # SBA-95-0403, PAPER FINANCIAL DIFFICULTIES OF SMALL
BUSINESS AND REASONS FOR THEIR FAILURE (1998); D. BRADLEY III & H. MOORE, “SMALL BUSINESS
BANKRUPTCY CAUSED BY LACK OF UNDERSTANDING OF BUSINESS ENVIRONMENT AND CONSUMER NEEDS,”
SMALL BUSINESS ADVANCEMENT NATIONAL CENTER, 1997; . REDEFINING BUSINESS SUCCESS: DISTINGUISHING
BETWEEN CLOSURE AND FAILURE, SMALL BUSINESS ECONOMICS, AUGUST 2003



                                                            © Copyright - 2010                    4
Tough marketing decisions

• 6 out of 10 business
  executives lack confidence
  in their marketing
  decisions
• 6 out of 10 feel their
  marketing could be more
  effective



SOURCE: “HP SURVEY REVEALS TOP U.S. BUSINESS MARKETING CHALLENGES,” BUSINESS WIRE, FEBRUARY 2008



                                                                © Copyright - 2010                 5
Advertising can prevent stagnation

A McGraw-Hill study examined
nearly 600 businesses from
1980 - 1985 and found:
•Companies that advertised
aggressively during the
recession had sales 256%
higher than those that did not
continue to advertise

Source: Advertising during Times of Economic Uncertainty.” American Business Media – Association of Business
Information Companies; 2008 Forbes Magazine, June 2008


                                                        © Copyright - 2010                                     6
A Case Study

• To cut costs, U.S. milk ads
  were pulled in the early
  1990s
• Sales went unchanged for
  12 months
• Then… sales began
  plummeting at alarming
  rates

Source: Marketing Daily Commentary, April 2, 2009, Wasting Money on Advertising by Gray Hammond


                                                    © Copyright - 2010                            7
The reality behind the cost-cutting decision

• Millions were lost and it
  took 18 months for sales
  to rebound!
• Apparently, it’s important
  to constantly remind
  buyers…
  “Milk Does A Body Good”

Source: Marketing Daily Commentary, April 2, 2009, Wasting Money on Advertising by Gray Hammond
BROOKS, D. & SEE, E. “THE SALES THREATS THAT CAN CRIPPLE MARKETING: YOU CAN'T CONTROL GAS PRICES,
WEATHER OR COMPETITION-BUT YOU CAN REACT,” ADVERTISING AGE, JUNE 16, 2008: MARKETING INSIGHTS – REF. HARRIS STUDY 2008



                                                  © Copyright - 2010                                                     8
For the full Executive
              Briefing please
                    visit
            howbizsgrow.com

                     800-278-1074


© Copyright - 2010                  9

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Executive Briefing Trailer

  • 1. Top 4 Reasons Businesses Fail to Grow Trailer Version
  • 2. The reality… • Only 5% of companies will ever reach $1 million in annual sales • Only .08% will ever reach $5 million Source: Chet Holmes author of The Ultimate Sales Machine: Census Bureau © Copyright - 2010 2
  • 3. Business stagnancy in the U.S. • Only 30% of businesses survive and only 10% of these businesses Where are grow you? • This means, 90% of all businesses become stagnant! Source: Office of Advocacy of the U.S. Small Business Administration adapted from the Bureau of the Census Economic Survey © Copyright - 2010 3
  • 4. A common theme • 60% of businesses that became stagnant listed poor marketing as a critical contributor • 50% of these businesses rated themselves “low” or “very low” in their marketing skills SOURCES: U.S. SMALL BUSINESS CONTRACT # SBA-95-0403, PAPER FINANCIAL DIFFICULTIES OF SMALL BUSINESS AND REASONS FOR THEIR FAILURE (1998); D. BRADLEY III & H. MOORE, “SMALL BUSINESS BANKRUPTCY CAUSED BY LACK OF UNDERSTANDING OF BUSINESS ENVIRONMENT AND CONSUMER NEEDS,” SMALL BUSINESS ADVANCEMENT NATIONAL CENTER, 1997; . REDEFINING BUSINESS SUCCESS: DISTINGUISHING BETWEEN CLOSURE AND FAILURE, SMALL BUSINESS ECONOMICS, AUGUST 2003 © Copyright - 2010 4
  • 5. Tough marketing decisions • 6 out of 10 business executives lack confidence in their marketing decisions • 6 out of 10 feel their marketing could be more effective SOURCE: “HP SURVEY REVEALS TOP U.S. BUSINESS MARKETING CHALLENGES,” BUSINESS WIRE, FEBRUARY 2008 © Copyright - 2010 5
  • 6. Advertising can prevent stagnation A McGraw-Hill study examined nearly 600 businesses from 1980 - 1985 and found: •Companies that advertised aggressively during the recession had sales 256% higher than those that did not continue to advertise Source: Advertising during Times of Economic Uncertainty.” American Business Media – Association of Business Information Companies; 2008 Forbes Magazine, June 2008 © Copyright - 2010 6
  • 7. A Case Study • To cut costs, U.S. milk ads were pulled in the early 1990s • Sales went unchanged for 12 months • Then… sales began plummeting at alarming rates Source: Marketing Daily Commentary, April 2, 2009, Wasting Money on Advertising by Gray Hammond © Copyright - 2010 7
  • 8. The reality behind the cost-cutting decision • Millions were lost and it took 18 months for sales to rebound! • Apparently, it’s important to constantly remind buyers… “Milk Does A Body Good” Source: Marketing Daily Commentary, April 2, 2009, Wasting Money on Advertising by Gray Hammond BROOKS, D. & SEE, E. “THE SALES THREATS THAT CAN CRIPPLE MARKETING: YOU CAN'T CONTROL GAS PRICES, WEATHER OR COMPETITION-BUT YOU CAN REACT,” ADVERTISING AGE, JUNE 16, 2008: MARKETING INSIGHTS – REF. HARRIS STUDY 2008 © Copyright - 2010 8
  • 9. For the full Executive Briefing please visit howbizsgrow.com 800-278-1074 © Copyright - 2010 9