Abundance flows to contributorsDan Sullivan
Get a FREE copy of my Marketing Strategies e-Book for ideas that you can implement immediately into your business! “More Leads – Joint Ventures” is one strategy outlined in the book, which I’ll share here as well.
Do you currently have any established joint venture partnerships?
JV’s involve two or more businesses who decide to form a partnership to share markets or endorse a specific product or service to their customer base… usually under a revenue share arrangement. The key to creating successful joint ventures is to find partners who service the exact same type of clients that need or want what you sell.
Let me give you an example and I’ll use one we’re both familiar with… a florist. One of the most financially lucrative product lines for a florist is providing flowers for weddings. The average floral bill for a wedding often exceeds $3,000. But what we discovered about florists is they fall into what we refer to as an “event chain.” An event chain simply refers to a series of businesses that customers purchase from in a specific sequence.
For example, a wedding will never take place until an engagement ring is purchased from a jeweler. So jewelers are at the forefront of every wedding chain. Once the young lady accepts that engagement ring, this event chain kicks into high gear. First, this young lady knows EXACTLY where she wants to get married, so number one on her agenda is to book the church, chapel or synagogue where she wants the ceremony held.
Second on her list is to line up her wedding planner. Weddings today are a really big deal, and often women like to use the services of a professional wedding planner. Next up, she wants to secure the venue for her reception.
She knows most venues book out months in advance, so locking in that venue is high on her priority list. After that comes the wedding dress, so she begins the search for the perfect dress at an affordable price.
Next is our florist. The bride-to-be will want to begin selecting her floral arrangements for both the wedding and the reception. Then after the florist comes the wedding cake… the printer for the invitations and thank you cards… and depending on the financial ability of the bride to be, she may also be interested in hiring a limo… a DJ for the reception… a travel planner for the honeymoon… the hotel… catering and so on.
This event chain is typical of this industry. And for the florist, it specifically identifies a multitude of potential and very lucrative JV partners. But here’s why this becomes so important.
Every business ABOVE the florist has the potential to ENDORSE and SEND prospects to the florist. Unfortunately, the florist has NO control over that flow of prospects. Every business above the florist controls the JV relationship, so it’s critical the florist create such a compelling offer and relationship with these businesses that they feel obligated to send prospects their way.
But here’s what’s even better. The florist controls the prospect flow to ALL the businesses BELOW them in the chain, and by establishing specific processes and procedures to make sure their customers use those businesses, the florist can negotiate compelling offers with those business owners as well. So consider these numbers.
Let’s say this florist cultivates a JV relationship with at least one of each business throughout this entire chain. Staying ultra-conservative with our estimates, would you agree this florist… since they have NO control over the flow of prospects from these businesses… is it likely they could obtain at least ONE referral each month from just one of the businesses above them?
OK, would you also agree conservatively that since the florist controls the flow of prospects to the businesses BELOW them… that they could easily send at least ONE referral to EACH one of them every month? Keep in mind these are VERY conservative estimates we’re using here.
Since the average floral bill for a wedding is $3,000… then just ONE referral per month from those businesses ABOVE the florist increases their annual revenue by $36,000. Now let’s consider the businesses BELOW the florist where the florist controls the referrals. Let’s start with the wedding cake maker.
The average sales price for a wedding cake is also $3,000, and the florist could easily negotiate a 10% referral fee. So, just a single referral per month produces an additional annual increase of $3,600 for the florist.
Now consider the printer. The average sales price for printing is $1,000, and the florist again could receive a 10% referral fee, so that single referral per month produces an additional annual increase of $1,200.
If we stop there, this florist has just increased their annual revenue by more than $40,000… and that’s using ridiculously conservative numbers. Imagine if you continued to add up the revenue produced by all the additional referral fees the florist would earn from all the other vendors in this chain.
This same process holds true for businesses that aren’t in a chain. But just like the florist, they simply identify partners who service the exact same type of clients that need or want what they sell. Now I realize this looks easy, but it’s not… and here’s why.
You not only have to properly identify who would make an excellent joint venture partner for your business… but you also must determine the order to approach each one… how to approach them… and when to approach them. It’s critical you do this properly or you wind up burning through all of your potential JV partners and come out with nothing in return.
Let me ask you a quick question. Just off the top of your head, how many potential JV partners would you estimate might be a fit for what you sell? Would you believe that I could identify more than a dozen for your profession? So conservatively, how many referrals would you estimate might be possible if a dozen other businesses were compelled to refer their customers to you for additional purchases?
Conservatively, let’s say you only get 3 referrals every month that buy from you. That’s less than one per week. How much additional revenue would that add monthly? Now multiply that by 12 to see your annual revenue increase.
One more thing before we move on. Remember earlier we discussed the critical importance of creating a highly compelling informational offer that would promise so much value to prospects that they would knock your door down to get it?
Suppose the florist offered this informational offer in their marketing, “5 Things Every Bride Should Know to Avoid Disaster on Their Wedding Day”. This offer would place TONS of prospects into their drip campaign and result in a tremendous increase in sales. Those new sales can then be referred to their new JV partners and they collect multiple referral fees every month.
This would absolutely dwarf the revenue we just uncovered for the florist in this example. What I find really exciting about JV’s is this is a strategy I help my clients implement immediately… and it begins generating instant cash flow for them right out of the gate.
In a recent case study I conducted, I found $75,000 in additional annual revenue just using the JV strategy.
And again, that’s revenue that business will generate year after year after year.
$75,000 in additional annual revenue increases the valuation of that business somewhere in the range of $225,000 – $300,000.
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As a business coach and marketing strategist, I work with small and medium size businesses that have little or no money to spend on markeitng. I show them how to generate all the leads they can possibly handle without spending any extra on marketing or advertising.
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Have you ever looked in the mirror and said to yourself, “I thought I’d be further along by now.” I have! In life and in business I’ve had that conversation with myself before. But it’s ok. Life doesn’t always go as planned. But that doesn’t mean you have to accept it.
The problem is that if you look in the mirror again in a year from now and you’re no further ahead.
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Self-discipline was twice as accurate as IQ in predicting the students’ grade-point average
An Excerpt, with some minor edits, from a note I was sending someone hoping to help them in a tough spot. I wanted to share it here as well, just in case someone reads it that could gain something from it.
You have been searching for answers and feel that you are not getting them. I can promise you that there will be a day when you look back on this time and will be able to see blessings that you cannot see now. You will be able to see where His hand was guiding you. You will understand the Why. Why you had to go through this trial. Why it wasn’t easier. And that is how you will make a difference in the world for many, many people. There are people near you that need you now. There are people nowhere close to you now that are going to need you. Everyone is dealing with their own struggles and challenges and they need help. Most can’t be helped by someone that has the book smarts on the struggle. But the person who can make a difference, the person who can change their life, the person who can save them is the one who has been there. The one who has been in their shoes and has conquered that challenge. My friend lost a baby boy and a brother in a short period. Nobody could really help her through those difficult times that hadn’t been through something similar. But now, she can take those tragic experiences and help many others going through their own tragic times. I often recall an old Young Woman’s theme, “I can do hard things.” Every hard thing that you have pushed yourself through, whether it was in a relationship, a sport, in business or something else has prepared you for something you will go through and deal with at some point in the future. Philippians 4:13 “I can do all things through Christ which strengthens me.” You’ve been through hard things in the past and it has strengthened you. You are going to go through hard things throughout your life and they will continue to strengthen you. Right now may be the hardest thing that you have had to deal with up to this point of your life. You can do it. You will grow from it. You are amazing. YOU are going to make a difference in the world!
Early in my career when I was a bank manager there were many things about my position that I enjoyed. I loved working with customers, analyzing their businesses to find the best solutions for them, and I loved coaching and mentoring my staff. Before I was in this position at the bank I had a manager who was a great coach to me. He mentored me well and taught me a lot about being a manager and a coach.
Throughout my career, coaching is one thing that I’ve continued to enjoy and today I love working with clients to help them work on their businesses, leadership and their personal lives. But whether I’m working with one of my clients, my own team or even the basketball team that I coach, there is one thing that drives me crazy.
What is it that drives me crazy?
It’s when something doesn’t work out because they didn’t do the things that I knew would work. It’s when my client, team or players don’t listen to me.
That is the reason that I’m writing this right now. Lets flip the situation around and put me in the client’s seat. Even though I’ve always loved coaching and leadership I’ve never done much in the way of writing or publishing. My coach has recently been talking to me about “finding my voice.” He wants me to start publishing on a regular basis, even if it’s only for my own benefit. He told me to write articles, blog, use Facebook Live, podcast, it didn’t matter. Just start doing something and share it somewhere.
Later when I was alone I sat down to my computer and thought about it. I understood what he was wanting and why it would benefit me. But my thought was that maybe journaling would be good enough. I would do all the writing, I just wouldn’t publish it anywhere. But then I put my coaching hat back on and thought about it some more. From a coaching perspective, I know why he wants me to do it. I also know as a coach how I would feel if I asked one of my clients to do this but they didn’t.
As a client, team member or player, if you want to grow and benefit from what your coach can do for you, you need to be all in. You need to do the things you are asked to do, even if it’s hard. Sometimes the task isn’t what you learn the most from. It’s the discipline of going through with the task that is the real teacher.
“What made (John) Wooden a great coach wasn’t praise, wasn’t denunciation, and certainly wasn’t pep talks. His skill resided in the Gatling-gun rattle of targeted information he fired at his players. This, not that. Here, not there.“
“Sixty percent of what you teach applies to everybody. The trick is how you get that sixty percent to the person. If I teach you, I’m concerned about what you think and how you think. I want to teach you how to learn in a way that’s right for you. My greatest challenge is not teaching Tom Brady but some guy who can’t do it at all, and getting them to a point where they can. Now that is coaching.”
“The people inside the talent hotbeds are engaged in an activity that seems, on the face of it, strange and surprising. They are seeking out the slippery hills… they are purposely operating at the edges of their ability, so they will screw up. And somehow screwing up is making them better.” – Daniel Coyle
There is a tremendous difference between feeling the fear and doing it anyway and the freedom which comes from finding the space in yourself which is beyond fear. And the more time you spend living beyond fear, the sooner the answer to ‘What would I do if I wasn’t afraid?’ will become ‘Exactly what I’m doing now.'”