CRM Blog

Fri, 22 Jan 2010

The reason to get on with CRM is... what?

Here's a perspective on why Customer Relationship Management (CRM) will make more difference to your business than anything else you can do.

Although the basic use for your CRM software is to manage and track sales activity with customers and prospects from a standardised products database to either help sell more to existing customers, or find new ones through marketing, or make your processes more consistent, there are greater benefits to be had. The ultimate goal if used to support and / or develop best sales and marketing practice within the business, is to help deliver improved free cash flow in the business.

Think about that. Using a system for managing customers and prospects better can lead to improved cash flow.

We don't just sell you the software but can support the business change necessary to get the most from it.

The point is that the reason for putting web-based CRM software in is strategic: using web-based CRM gives you predictable costs, better data security and a framework for delivering more sales of better quality and better profit margin through the business. Everyone becomes a marketer. NB: In the business process this happens before, or in front of the accounts system and can be installed independent of it then linked.

So the reason to get on with it sooner rather than later is ....that however conservative you want to be about the likely returns, it is costing you significant sums to do nothing.

Yes it can be very difficult to calculate Return on investment made. Here's a simple sum. Ask us about it if you just want to argue about the numbers.

What percentage do you feel confident using CRM would save you against your current costs? Or add to your annual turnover? This could be from less steps in the order process, standardisation of documents, generally streamlining your processes. Or think of it just in sales increase terms, from selling more to existing customers by closing more sales, reducing the number of quotes that go nowhere, or finding new customers. Pick a safe percentage, say 2% - 5%. Work out what that is as a £'s value on your turnover.

Take the projected cost of the CRM system. Divide one into the other.

This is what the payback period would be if using it as part of your day to day activity put just 2% on your turnover. Certainly less than 6 months? Then take that 2% a year and work out what its costing you over the last six months not to have done it. What other investment in your business has that sort of payback period?

Example:

• £2 million turnover @2% = £40,000 in first year
• Software cost say £20,000
• Actual payback on investment 6 months, after that you are ahead

Or if you prefer, every 6 months if you don't do something costs you £20,000 (on the above sums).

You do the sums based on your turnover, then talk to us for more information. No hard sell, because we don't need to.

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