At this year’s 4u2grow Annual Conference, we dove deep into what it takes to grow your business – including the reason why you shouldn’t be afraid to make money. Attendees discovered that it’s not enough to have a dream, you need to turn that dream into a reality. You do that by creating actionable goals that are S.M.A.R.T – specific, measurable, attainable, relevant and time-binding.

“I want to grow my business” isn’t a goal – it’s a dream. “I want more customers” and “I want to make more money” aren’t goals either. Finish out the year strong in 2019 and successfully discover how to set business goals and achieve them by asking yourself these three important questions:


How many clients do I need?

Desired Total Revenue Gained / Average Revenue Per Client

Start by setting real goals. Then, think about how many clients you need to meet those goals. Is it two clients each month? Is it two clients each week? You need to identify how many clients you need to make your dreams into a reality. Figure out this number by dividing your desired total revenue gained by the average revenue per client. If your desired gained revenue is $10,000 per month and you gain about $5,000 on average for each new client, you need two customers to make your dreams into a reality. This number may change as your business grows and your goals adjust, but each time you set a new goal you need to revisit this question.


How many leads do I need?

Total Number of New Clients Needed / Close Ratio

Figuring out the number of leads you need is simpler than it first appears – just look at your close ratio (the number of sales divided by the number of leads). If you close 20 sales for every 100 leads, your close ratio is 20%. That number fluctuates based on the quality of your leads, but it gives you an idea of where to start. Now that you know your close ratio, divide the total number of clients needed by that number. If you want to sign two new customers per month, you’re going to need a minimum of ten qualified leads.


How much are my leads worth?

Annual Revenue / Number of Active Clients = Average Revenue Per Client

Average Revenue Per Client x Number of Years Average Retain = Average Lifetime Revenue Per Client

Average Lifetime Revenue Per Client x Net Profit Percentage = Average Lifetime Profit Per Client

Average Lifetime Profit Per Client / Sales Close Ratio = Value of a Lead

Discover the true cost of your leads in four easy steps:

  • Take your annual revenue and divide it by the number of active clients you currently have – that gets you your average revenue per client.
  • Now, take that number and multiply it by the number of years you keep customers (on average), that equals your average lifetime revenue per client.
  • If you take the average lifetime revenue per client and multiply that by your net profit percentage, you’ll get your average lifetime profit per client.
  • For the final step, take the number you got for the average lifetime profit per client and divide it by your close ratio.


That’s the value of your lead! It takes a little bit to get there but understanding the value of your leads is essential to meeting – and exceeding – your goals.

Now that you know the three most important numbers for your business – plan ahead. Start implementing strategies that help you reach your S.M.A.R.T goals. Think about what you can do now to give your business that final boost in 2018, and then prepare for a fruitful 2019.

Don’t settle for daydreaming – contact us today to learn how to set business goals and achieve them with our marketing strategies that help you turn your dreams into a reality.