In the retail market a great looking label, a unique container design or even the ‘Made from recyclable materials’ message, may just be the thing that hits a customer’s ‘buy’ button. Packaging is all about promoting your product and how well it’s done is critical to sales success. If you don’t want to see your products languishing on the shelves, give them a critical appraisal with the following points in mind.

Does it stand out on the shelf?

Begin by looking at the packaging of similar items already on the market. Think about what your competitors have done and why they did it.  Packaging can make a product stand out from its surroundings and that’s definitely a marketing advantage.

For smaller manufacturers, packaging is often the only ‘advertising’ their product receives. It can also be the only means they have of combating products with greater shelf space or more easily-recognized branding.

Does it meet legal requirements?

Packaging should be informative about what’s inside. In many cases there are legal requirements governing what information must be stated – weight, materials used, whether the product is hazardous, where the contents originated and so forth. The same regulations may even specify the type sizes to be used and the location of these details on the package.

Most countries have their own packaging standards and these must be followed if your product is being exported to them. Find out about these before you start the packaging design exercise.

Have you considered the buyer?

The packaging has to be targeted to the product’s customers as carefully as any other promotional element. Are the buyers primarily male or female? Will they come from a younger or older age bracket? Are they likely to be sporty types or computer fanatics? Unless the packaging has a real visual appeal for your target audience, sales just won’t happen.

Customers like to see what’s inside the package, even if it’s only a photograph of the product in use. Remember the old adage that ‘A picture is worth a thousand words’ – it gives you the chance to show your product at its best to the person thinking about buying it.

Does it tell them how to use it?

Many items are purchased on the basis of ease-of-use, so prospective buyers will often read the instructions on the package to see if there are any complicated procedures involved in getting the product to operate. Even if what’s on the outside of the package is only an outline of more detailed instructions inside, or an assurance that it is easy to install or operate, it can provide a great degree of reassurance for the customer.

The package is also the place to put your product’s guarantee.  A ‘satisfaction guaranteed or your money back’ statement can be a significant purchasing incentive.

Does it protect the contents?

The package’s physical construction is very important. The packaging is often all that protects the product and prevents it from being damaged in transit or while on the shelf awaiting sale.

The package has to be designed in such a way that its appearance won’t be degraded by shipping and handling. Packaging can also help protect contents against temperature extremes, excessive humidity and moisture. So good packaging can save you a lot of wastage.

Security is becoming increasingly a packaging function also. Small items that could be easily hidden are often given much bigger packages to make them more difficult to conceal. Packages are deliberately constructed to make them difficult to open as another aspect of theft prevention or item substitution.

The package around a product is a lot more than just a container to hold it. Packaging is a combination of art and engineering that can swing the decision to buy. One adage you can afford to forget when it comes to packaging is ‘You can't judge a book by its cover’ - no matter whether its ice cream, perfume or a children’s toy, customers do react to the packaging.

Negotiating is a process between two or more parties by which they attempt to find a mutually acceptable position.  Negotiating may end up with a ‘winner’ and a ‘loser’ – that is, one party giving in completely to the other so that an agreement can be reached, but more often than not negotiation is about compromise so as to find an outcome that provides some satisfaction to both parties.

Negotiation, in a business context, is used in selling, purchasing, determining the details of a workplace agreement,  arranging a loan, getting the best deal from suppliers and any number of other situations.  In fact, you probably spend quite a lot of time negotiating in one way and another.

There are skills and techniques that experienced negotiators use to ensure that they come out of negotiations with a worthwhile result and the application of these techniques will improve your chances too of getting the best deal in your negotiations.

Make a preliminary analysis of people’s positions

Before beginning negotiations analyze what’s driving the thinking of the other party.  Basically, this means understanding what they really need to achieve, so that you can assess as closely as possible just what they might be prepared to accept. You should know what are the most important points that the other side is pushing and which are of lesser importance, ones they’ll likely concede more easily.

This applies to your position as well. You need to have a full understanding of your own position and know exactly what you want ( a 2% cut in price from your supplier, an extension of 6 months to the loan repayment period or whatever) and where you’ll have to ‘draw the line’. Be very clear in your own mind as to what will constitute an acceptable outcome.

Plan a negotiating strategy

Decide what your approach will be. Are you going to start off by asking more than you really want and then fall back to a position where you seem to give in but actually achieve your goal?  Do you play it tough all the way to the end or give up your original position in gradual steps?

Try to anticipate the strategy of the other side as well. Study their previous negotiations and how they were conducted. It will help you predict how they’ll respond to your actions as you proceed.

In general, when negotiating aim as high as you feel necessary in order to achieve the best deal for yourself. The other party may be able to get you to give way on certain points but in general it’s a good tactic because giving way a little is easier than trying to get extras included as you go along.

Be clear on the details

Negotiations are often used to produce a contract, so it’s necessary to consider the fine print in any negotiating situation.

Never allow a misunderstanding to arise. If you’re in doubt on anything, ask questions until you’re positive you know the answers and what they mean. You don’t want to reach what you think is the end of negotiations, only to find out that you aren’t getting what you thought you’d bargained for.

Be adaptable

You need to be ready to adapt quickly to meet changes in the other party’s position. If they cave in earlier than you anticipated do you have a way of getting more out of them? If they prove to be tougher than you thought would it be best to call a halt and reconvene at a later time?

Try to anticipate what the other side may offer as a means of compensating you for giving in on something. Be ready to find ways of giving the other party something in return for a concession they’re prepared to make.

Never lose sight of your objective

Negotiations can go on for extended periods of time. Often this is the result of a delaying tactic used by one side to wear the other side down in the negotiations. Another reason for going slowly is to frustrate the other side and try to gain concessions in return for speeding things up. Whatever else happens during the negotiations, remember what it is you want and what you’re willing to accept. Don’t be distracted by delays or by peripheral offers or concessions.

We use negotiation in everything we do but you have to be sure that it is done in the best way possible to achieve maximum benefit. The most important part is planning; good preparation is a definite advantage when negotiating.

Profitability in businesses usually follows the ‘80/20 rule’ – 80% of the profits come from just 20% of the customers. The numbers vary from one business to another of course, but how do you go about figuring the value to your business of individual customers or customer groups so as to identify, and maybe encourage, those contributing most?

There are basically four ways of slicing and dicing information to assess profitability. Some ways do it much better than others.

1.    The total amount a customer spends. This is the most common one business people apply. If Customer A spends $250,000 per year with your business and Customer B only spends $150,000 per year, it’s likely you’ll see Customer A as the bigger customer.  It’s straightforward but in fact it’s by no means an accurate way of telling a ‘good’ customer from a ‘not so good’ one. You need to dig deeper for that.

2.    The gross profits earned from each customer’s purchases. Say Customer A’s $250,000 buys them 250 basic units at $1000 each and your gross profit per basic unit is $185, then their profit contribution to your business is $46,250. If Customer B’s $150,000 buys them 5 luxury units at $30,000 each and your gross profit per luxury unit is $8,500, then their profit contribution is $42,500. The mathematics is very simple and demonstrates that although Customer A spends $100,000 more than Customer B in a year, their contribution to your profits is only $3750 greater. Next, look at the number of purchases made by each customer.

3.    The number of purchases each customer makes. Customer A makes 250 purchases a year whereas Customer B makes only 5 purchases per year. Customer A provides a profit contribution of $185 per purchase, while Customer B provides a profit contribution of $8500 per purchase.  Or to look at it another way, each purchase made by Customer B is nearly 46 times more profitable than a purchase by Customer A!

4.    The cost of servicing each customer. Finally, calculate the costs of servicing them. Taking everything into account from selling costs to fixed overheads, it’s still likely that a customer making five purchases per year is going to cost less to service than one that makes 250 purchases per year.

This sort of analysis reveals some interesting facts important to your profitability and maybe your marketing approach as well. Customer B – the ‘smaller’ customer, is really worth about the same to your business as Customer A despite the $100,000 difference in what they spend with you. When planning a profit strategy you’d be better off getting customer B to purchase just one more unit than trying to get Customer A to make a lot of extra purchases, or to get more customers like B than A.

Take a new, more analytical look at your customers and their purchases. Look for their contribution to your net profit rather than just their turnover and you’ll start seeing them in a different light. Some probably won’t turn out to be as big – or as small, as you’d thought.

Every business needs to prepare an annual marketing plan. It’s a kind of ‘roadmap’ complete with milestones and directions that help you get where you want to go.  There are five areas that need to be covered in any marketing plan. The extent of the coverage really depends on how detailed it needs to be to suit your individual needs. There are no points earned for fancy writing but it does have to be thorough and communicate all the important facts about your business. But it doesn’t have to bristle with hard to come by facts and figures. You can put together your own simple marketing plan by documenting things in five simple steps.

Step 1 – Look at where you are now

Describe your present situation; what you’re doing, what you’re selling, how you’re selling it and include an analysis of your competitors and how they are handling these things – this can provide plenty of ideas for improvement in your business. Have a look at what’s happening in the market and any indications of new products or directions on the horizon. State the commercial and legal forces that are impacting on your business.

Do a bit of research into what others in your line of business are doing. The internet is handy for this. Look for trends or outstanding successes you can emulate. Include your revenue and profit expectations for this financial year.

Step 2 – Analyze your current customers and think about who might be prospective customers

Perform a simple analysis of your present customer base. Are they businesses or individuals? What do they buy? Why do they buy from you? How do you reach them?  List your customers or identify them by groupings as may be appropriate. Analyze each customer or group and their importance to your business, then assess which represent the best opportunities for growth. What can you do for each group that might help you get more purchases from them?

The most difficult part of this analysis is to identify those segments that you don’t have as customers now but would like to add to your customer base. Who are they and how can you acquire them? What would it take to get them buying from you?

Step 3 – Decide where you want to go

This is where you list your goals, targets, hopes and dreams for the next twelve months. For this, use the most realistic estimates you can make, not just wishful statements - unit sales, revenues, customer numbers, average sale value and so on. If you can break it down by months or quarters, even better.

If you intend to acquire a particular customer or account put this down too, together with the anticipated value to the business it will bring in.

Step 4 – Plan for how you’ll get there

This is the core of your marketing plan. Here’s where you summarize your strategies and how you’ll manage them. If you plan to advertise you’ll put it here, together with the reasons for the advertising you’ve planned and what you want it to accomplish.

If you plan to use publicity to reach into a certain industry or exhibit at shows to target a particular type of business, list the idea here and include why this particular activity is important to your business.

Put all the elements of your plan into a calendar and see how it looks. If your promotions are too concentrated in one part of the year you’ll see it here and redraft your plans. If you’re planning a big sale you’ll have to correlate your promotions so people know it’s on. Relate every activity here to where you want to be at the end of the year.

Step 5 – Set the marketing budget

This is where you put it all down in terms of money. Every marketing activity has a cost and should also make a contribution to your revenues. Express all the plans you’ve made in a budget and work through it until it looks good on paper. Take the costs of the activities you’re planning, and balance those with achievable estimates of what you’ll earn. This should be shown at least by quarter and preferably by month.

So now you have a marketing plan. Get it in print and work to it. You know exactly where you are now and where you want to be in twelve months’ time. You have a calendar of marketing activities and a budget you’ve agreed is realistic.

Developing a marketing plan and following it is the best way to assure that your business really will reach its sales target.

“Minds are like parachutes. They only function when they are open.” – Sir James Dewar, Scientist (1877-1925)