A CRM, or to give it its full name, Customer Relationship Management, is software that organizes a business's transactions with their customers, including sales, customer service and marketing campaigns. But most of all, CRMs almost always lead to a significant increase in profitability. Here are four reasons why your small business could benefit from a CRM.
Enhanced customer administration
A CRM can aid a small business in having a clear understanding of their clients. For example, a CRM can highlight how many of your customers occupy a certain demographic, such as finance or medical, which could mean your business would be better served if it had staff who were trained in these fields.
Understanding your client base in this way will also help you develop better marketing campaigns. For example, if you know a particular demographic has aspirations of a certain lifestyle, you could offer products that would help them achieve this. A CRM will also show which products are your best sellers and which are less popular, so you can decide whether to continue stocking poor sellers or whether to reduce the price to generate some sales. This should have a positive effect on your cash flow and stock control, effectively giving you the chance to de-clutter your stock.
A CRM can make profitability tracking easier due to an integrated accounting software. The CRM will, among other things, produce financial reports and keep track of payments coming in and going out, both of which will make it clear where your money is being spent and somewhere where it can be cut back.
Value-added customer service
Knowing what your customers are buying, the complaints they are making and how much they are spending will enable you to deliver a customer service that has added value. Knowing what they buy and how often you can can anticipate their needs so that you need never run out of stock and make them wait for a delivery. You can also see what aspects of your business are causing the most complaints and react accordingly. All of this will improve your relationship with your customers and hopefully turn them into loyal patrons.
Of course, small businesses can manage without a CRM, but doing so could mean they are focussing on the less productive areas of their administration, rather than honing in on the areas that could make the most money.