One of the challenges of any business is understanding the sales cycle, assuming there is one. Now obviously, some business are seasonal, or can anticipate increased sales volumes for certain times. Christmas is going to increase catalog, retail, and online sales, all of which will increase the amount of traffic for FedEx, UPS, and the US Postal Service. But what about your small business? Is there a semi predictable cycle? In my opinion, even if there is, predicting numbers is still like throwing nails at a dart board. In other words, wildly inaccurate.
However, to an extent, I have learned that dips are far more predictable than peaks. Here are a few examples, and it is all driven by customer reaction.
In late 2008, the world crashed. The markets crashed, sales crashed, credit crashed. Hell in a handbasket. Through the first three quarters of the year, we were up in sales, and looking great. Fourth quarter hit, and we saw a fifty percent decrease in sales from the previous fourth quarter. Now, fourth quarter is generally our slowest with holidays and such in there, but occasionally it surprises us with some end-of-fiscal-year bumps. However, fourth quarter 2008 nearly called for layoffs, and I admit, it wasn't something I saw coming. Having experienced it once though, I now know to be on the lookout for it again. As a plus though, because the UIU saves customers a tremendous amount of time and money, 2009 turned out our best year to date, which very few companies could say. So again, I now have a historical piece of data to work with in the future.
Another example for us has been associated with the release of a new Microsoft operating system. When Vista was close to release, our sales slowed or were delayed because customers didn't know exactly what to expect from Vista. Rumor had it that UIU would be unnecessary. Well, that was obviously incorrect, as sales continued to increase, but it was understandable. Consequently, when Windows 7 was announced, we fully expected the same thing. Customers would delay purchases while reviewing their environment. Windows 7 would cure all their problems. We had several customers not renew their UIU licenses as they were positive they didn't need us. Well, 2011 proved that wrong, with record sales and several customers coming back to the UIU. But, because of our experience with Vista, the Windows 7 hit and subsequent rebound was predictable.
The third scenario we have run into is with our own product updates. It was not uncommon to hear that a customer wasn't going to purchase or renew until we had released a new version - something compatible with Vista, Window 7, containing certain drivers or fixes, etc. The customer always wants assurances that it's going to work in their environment, and despite years of proving our commitment, fear still reigns. Not much you can do, but understand that the process will take time. So, when we heard customers were leaving us for Microsoft's SCCM, because it would do everything they needed (see point two), we listened and waited, and soon those customers started asking if the UIU was SCCM compatible. As those requests grew, we realized we needed a new product that would integrate with SCCM (UIUSD), which we just released in April. That release though has caused a slow down in sales and renewals because for existing customers moving, or considering moving, to SCCM, they now had to do the research and evaluate their environment. And so while sales fell dramatically in April, I was able to warn my sales and marketing staff that it would likely happen. No one is happy about having such a terrible April, but the interest in UIUSD has been awesome, and we can fully expect the corresponding increase in sales shortly.
I don't think business is tremendously predictable, as far as set numbers. We would all like to increase sales by a certain amount every year, but can we predict that with any accuracy or certainty? I don't believe so. What I can do though, is be somewhat predictive as to when sales may increase or decrease based on certain outside events or perceptions. The more cycles you go through the better a predictor you should become, as long as you learn to recognize the patterns.