10 Tiny Changes To Make Your Business Several Times More Profitable
No business is ever 100% perfectly well managed, as there’s always room for improvement. This is why the entry of a new CEO, investor, board of directors, or advisor into a company can make things a whole lot better or slightly worse.
For whatever revenue your business currently generates, it can do a whole lot better. A few changes in different quarters can determine how much faster or slower the business will grow.
If you’re thinking of what to do to make your business more profitable, here are 10 small changes you can implement today:
1). Raise Your Prices By 5%:
Depending on if your products are already too expensive or not, you could slightly raise the price of your items by 5%.
Ensure you have a competitor whose products and services are more expensive but delivers lesser value, even if you raise your prices. This way, you can compare your quality and price to theirs when trying to justify the new price to your customers.
2). Reduce Your Direct Cost By 5%:
Direct costs are the costs that go into the production process, thereby affecting the price of the final good. It could be raw materials or amounts paid to staff who are directly involved in the production process.
You can reduce the direct cost by negotiating a new price with your suppliers. If you can get the price lower by 5%, you’ll be more profitable.
3). Increase Your Leads By 10%:
Increase the channels you promote your products and services on, by listing them on directories, classified sites, improving your SEO ranking, introducing social selling, adding email marketing, starting a blog for your business, and a whole lot more.
Doing these exposes your products and services to more prospects, and in the process, increases your chances of closing more sales.
4). Get Rid Of Underperforming Staff:
While unfortunate for the employees who would get affected, replacing them with high performers is a better option to take. Low performing employees cost your organization money.
If you have the means to hire better performing employees that’d deliver more value, and in the process, more revenue for the business, hiring them and getting rid of the underperforming employees is a fair bet to make.
5). Change Your Mode Of Advertisement:
Most businesses highlight the features of their products and services whenever they advertise them. This only works to an extent.
If you want prospects to convert even faster, you need to talk about the benefits of using the products, not just the features. The benefits are the end results of its use, and that’s what customers want to learn more about.
6). Improve Your Sales Skills:
As always reiterated on the blog, sales are the lifeblood of every business. If you’re going to grow your company’s revenues, you’d have to either become a sales expert or hire sales experts to work for your organization.
If you lack the technical know-how, you could attend a sales course to learn its rudiments, then as you implement them, it is important you make mistakes fast. This way, you’ll know what works and doesn’t sooner than later, even though you may lose a lot of time and money in the process.
7). Remarket To Existing Customers:
These set of individuals are your best marketing bets. Since they’ve already purchased once from you, they’ll tend to buy again at even higher prices.
Get feedback from them, understand their needs, and show them how your other products and services can solve their problems better than the competition.
8). Collect Money Ahead:
For products-based and especially service-based businesses, getting the customer to commit even a small sum ahead, can get them to go through with a transaction. Instead of telling them to return on a later time in the future for the item, you can tell them to pay a small sum that’d help you expedite and ensure their items are not given to someone else.
Asides just on the customer’s end, getting part payment builds the confidence of your banker in your business, and so, increases the chances of you securing a bank loan to finance your projects.
9). Eliminate Expensive Services And Activities:
Every expensive service always has a cheaper alternative. This is true as most services that businesses pay for can always be replaced with a low-cost version that is also efficient.
Identify the services your business pays exorbitant amounts for, and reduce the impact of their costs on your profit margins by paying for cheaper alternatives.
10). Increase Your Customer Referrals:
After every successful sale, politely asking the customer to refer your business to others who may need your products and/or services can go a very long way in increasing your profit margins.
You could also introduce an affiliate program or referral system, where customers are given a 10% off the value of their affiliates or referrals. This way, they’d be more motivated to act, since they know they’d make something from every successful affiliate or referral they bring in.
What are your thoughts on these 10 small changes that can make your business more profitable? Let me know by leaving a comment below.