Cover all the bases to maximise profit and secure your business strength
In my years of Coaching, I’ve found that there’s a need for business owners to change their practices and focus more on profit. I know that they’re aware about profitability and how important it is to sustain their business, but most of them don’t actually do something to maximise their capacity to increase it. Therefore, lots and lots of opportunities are wasted every passing minute.
Why are they not doing something about it? Well, for most of them, the answer is obvious: get more sales. They do it by selling more or raising prices, both of which are rather tricky to pull off.
We see a lot of small businesses flourishing and getting to the top but what we don’t know is that a larger majority of business are actually either not making a profit or failing to increase their profits from the year before, both of which are not good signs of business health.
Even just a 10% increase can do wonders
The road to boosting profit doesn’t have to be of grand scale right from the start. In fact, all you need is just a small improvement — say, 10%.
There are several aspects of the business where you can start making that small boost. You start with the number of leads generated and try to improve your current number by 10%. Then, because you increased your leads that means you’re going to want to improve on your conversion rate, so you target 10% higher than what you normally convert. The result? More customers.
That “small boost” trickles down to the number of transactions and sale, which you would also target to improve by 10%. Naturally, more transactions and more sales means higher revenue and margin!
First, you must know where to start
The idea of boosting profit by 10% sounds brilliant, but again, you need to start somewhere. How exactly do you boost lead generation efforts? Well, you can look at all the opportunities around you and pick those that you think will work. You can get more leads, for example, by advertising in a variety of media (newspaper, television, radio). You can also be a bit more digital and leverage the Internet by building a website or launching an email campaign.
For converting customers, you can enhance your strategy by adding more “tricks” to your arsenal, such as defining your unique selling proposition or giving a written guarantee. You can even engage in coming up with your own product line and focusing on quality, range and variety.
The same goes for increasing transactions and sale. Give more emphasis on customer service and build a reputation of consistency and reliability. Allow flexible payment terms and create package deals.
And of course, this all boils down to increasing your profit margin, which will bring you a step closer to more profit. Increasing margins entails looking for ways to save money so that expenses are lessened. You can look at reducing team size, directors’ fees, marketing budgets and operational costs. You can even look at selling off some of your old stock or renting out space you don’t use.
These are just a few examples of how to get you started. There’s a lot more you can do!
Download the 200 Profit Boosters You Can Apply Today PDF for more real-world techniques to increase your profit!
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