Learn how to increase profit for your business with these 7 practical strategies. Take 5 minutes to consider these 7 profit-boosting strategies – there’s bound to be something in here that you can use today.
1. Increase Your Prices
It’s all too easy to dismiss a price rise with a thought like, “my customers would all leave if I did that.”
Yet whenever my clients have done this (and 95% of them have use it as a strategy) their profits have substantially risen.
Do the maths and work out what an extra 5-10% on your price would do to your bottom line profit.
2. Compare Quotes To Actual Time & Costs of Each Project
Many companies that do projects, like alarm or electrical installations, base the job price on a fixed quote. If you don’t carefully track the actual time and materials that go into each project like this, you’re almost certainly losing a lot of money on some jobs.
3. Renegotiate Your Rent
While not commonly considered, most landlords would prefer a tenant on a lower rent than an empty unit. Get into a constructive negotiation with your landlord and see if you can reign in the monthly rent.
4. Change Suppliers
Go back through all of your monthly spend and find new suppliers, or negotiate better deals with existing suppliers, so that you’re getting the best deals from them. You can normally save anywhere from 10-20% if you shop around and do your research well.
5. Sack Expensive Customers
You know the kind of customer that calls 3 times a week, spends half an hour moaning about your prices, fights every invoice, pays late and expects special favours? They’re costing you money.
Look at the profit per hour of your worst customers and get real with them – tell them you’re not able to work this way with them this way, put up their prices or get rid of them. But don’t suffer in silence.
6. Use Processes To Eliminate Costly Mistakes
If you waste a lot of your time fire-fighting and dealing with issues, you probably need to systemise your business. Systems eliminate mistakes before they happen, make life simpler for your staff and take the drama out of day to day business.
They’re also a great way to increase profits, because when you make no mistakes, you’re more efficient and make more profit.
7. Introduce A Higher-End, Luxury Product or Service
A clever way to increase margins in your business is to offer a luxury or specialist product that’s attractive to the top 20% of your customers. You see examples of this all the time when you open your eyes to it – car manufacturers offer GTi versions of their hatchbacks and make a real killing on higher margins from them.
Above all, though, you need to take some action. Your business can increase profits, of that there is no doubt, but only when you take action…