Four Key Revenue Drivers in My Venture

What are the four key revenue drivers in your venture?

To understand this better let us suppose that you want to open a coffee shop. What drives revenues at
an establishment like that?

1. The first driver are the potential customers.

How many customers will come into your coffee shop?
 The number of customers in a regular coffee shop varies widely and The number of
customers to expect from a coffee shop depends on several factors including location
and atmosphere.
How much are they willing to pay to stay?
 People like relaxing environment and for this they want to a good amount moreover it
also depends on popular items that go well with coffee. Owner has to use and present
good quality. The cost will vary according to the venue, scale, and equipment needs of
the coffee shop.
How will you attract customers to your location?
 There are different ways to attract customer on a coffee shop such as;
 Price should be affordable
 Create seasonal drinks
 Be active on social media
 Make different deal for customers
 The atmosphere should be clean
 Offer multiple snacks

2. The second key driver is frequency.

How often will your customers come into your coffee shop?
 The customer will come at weekend.
What incentives can you offer to keep them coming back?
 We can offer them special deals, free wifi connections and we can also offer affordable
prices and membership cards.
May you be able to increase frequency by adding additional services, or online coffee sales?
 Yes we can increase frequency by online services

3. The third driver is selling process.

How much time will you be able to sell?
 Suppose you're running a single coffee shop and assume you have about 200 customers
coming in your store daily and each spends about five bucks. You're working six days a
week for 52-weeks a year, which means you're taking no vacation.
What kind of upselling or cross-selling opportunities can you find? For example, you might add
products such as snacks to sell alongside the unlimited free coffee to generate more revenue?
 Cross-selling takes a bit of skill and flair to pull off correctly. Here are a few tips to
increase the effectiveness of your cross-selling strategy:
  Instead of trying to make an additional sale right at the start of a new relationship, it
may be best to wait a few days or weeks before selling a client on any other service.
 Once you can show measurable results, clients will be more willing to invest in your
additional services.
 One way to cross-sell clients is by offering additional services.

4. The fourth driver is price.

If you think your price should be higher than what your competitors charge, what are the factors
that increase the value of your product?
 The key success in business is fairing pricing of the products. Rightly pricing your
products can enhance how much you sell, creating the foundation for a prosperous
business. Get your pricing plan wrong and you may be generating issues your company
will never solve.
If you raise or lower prices, what will be the impact on your customer base?
 It is important to note when addressing a price increase in a business to business setting
that our clients often had to have the same conversation with their own clients. A
business lives only as long as it makes a profit and can only do so it offers the right price
for a quality product or service.

Now, let us think about answering similar questions for your own venture. Describe your thoughts as
you consider similar questions for the business you think about launching.

1. Revenue levels as they relate to customers.

How many are you likely to have? What does it depend on? How will you attract them?
 I would to about 150-200 customers to visit on venue. The number of customers depends
on different factors such as shop location, atmosphere and capacity. I can attract customer
by offering them special deals, by offering memberships and to accommodate them with
different services like free internet and relaxing environment.

2. Revenue levels as they relate to frequency.

How often will they make a purchase? What does it depend on? Are there any good ways in
which you can increase the frequency of purchase? How will you attack customers to come
back?
 The customers can come twice or once in a week according their schedules. We can
enhance our purchase by developing customer trust. We have to be transparent moreover
we have to present good quality products. The price for a product or service is one of the
most important business decisions we make. If we're starting a business, carefully
consider pricing strategy before start. Established businesses can improve their
profitability through regular pricing reviews.When setting prices we must make sure
that the price and sales levels we set will allow business to be profitable. We must
also take note of where our product or service stands when compared with competition.
3. Revenue levels as they relate to selling process.
How much time will you be able to sell?
 For a single coffee shop where you have about 200-300 customers coming in your store
daily and each spends about five bucks. You're working six days a week for 52-weeks a
year, which means you're taking no vacation.

What kind of up selling or cross-selling opportunities can you find?

 Expanding services with your current customers is one of the most successful ways to
develop your business. The cost of up selling or cross selling an existing client is much
lower than acquiring net new business.

If you need to offer some time to make a payment (like it may often be the case in business-to-
business, manufacturing, wholesale, etc) how may you encourage your clients to make the
payment faster?
There are different ways to encourage clients to make payment faster.
a. Set payment expectations early and give gentle reminders.
b. Do not hesitate to follow up after sending the invoice.
c. Offer small incentives for quick payment.
d. Establish personal connections with clients.
e. Negotiate Clear Payment Term
f. Provide a small discount for early payment

4. Revenue levels as they relate to price.

If you think your price should be higher than what your competitors charge, what are the factors
that increase the value of your product?
 To increase product value does not have to be difficult, but it takes some critical
thinking. Here are different strategies to increase product value;
 Offer better quality of your products
 Increase your delivery speed
 Improve your product design

If you raise or lower prices, what will be the impact on your customer base? What pricing
strategy (Ch 10 discusses several) may be the most appropriate for the product or service you
want to sell?
One of the most important aspects of marketing strategy is pricing a product. The first phase
in deciding your appropriate pricing strategy is setting your pricing goals. The chosen strategy
can make or break your business because price of a product directly affects the revenue of your
company. Generally there are five type of pricing strategy which are discussed below;
1. Cost plus pricing: simply calculating your costs and adding a markup
2. Competitive pricing: to set price on the basis of competition
3. Value-based pricing: to adjust price on how much customer believes
4. Price skimming: first set high price and then lower it
5. Penetration pricing: to enter a competitive market set low price and increase it later.