As a financial control firm our objective is to help our clients get the most of their business which means looking behind the numbers and asking questions to understand the issues, people and behaviours that impact on their business. Often this will mean crossing over to other disciplines such as sales and marketing but fortunately I know my limitations and once I identify an issue I ask for help from the experts!
Once such issue was the power of upselling. Every time I go to a McDonald’s restaurant and order a meal I am always asked the following question, “would you like to up-size that?”. For the record, I generally say no, but think of how many times that question is asked in every McDonalds restaurant across Australia. More to the point think how many people actually say yes and pay the extra $1 or so. How much extra McDonalds earn every day from simply asking “do you want to upsize that?”, $500,000, $1,000,000, $2,000,000? The bottom line is that it really doesn’t matter, what matters is that McDonalds train their staff to up-sell and it works and it makes a lot of money.
Think in terms of how it can work for your retail business. Using the following assumptions, you sell to 700 customers every week and they spend on average $20 per visit. Simply by increasing the Average Customer Sale by $2.00 will result in an increase in weekly sales of $1,400 and an annual increase of $72,800. There are many strategies you may use to increase the Average Customer Sale, such as “spend $22 and get a widget free” or suggestive Selling “special” products which will increase the Average Customer Sale.
But it is not an easy strategy to follow, training your staff to upsell or upsize is not natural to most people and hence may not feel comfortable doing it. It is important to identify the products that you upsell, training staff to “ask the question” and making sure that the products offered are considered valuable and that you don’t harass your customers in the process. Good luck.