Secrets for Boosting Profitability
Profit. It’s why we’re in business. While we all want to have an impact on society, we also know that we can’t have a business if it’s not profitable. Boosting profitability is extremely important. The good news is that there are some simple secrets that you can take advantage of to boost your profitability regardless of your industry.
Get Control of Your Business Expenses
Controlling expenses is one of the top secrets in boosting your profitability. When you keep costs down, you have more cash flow and more profit for your business. Here are some ways you can get control of your business expenses:
- Review all yearly contracts at the end of their term. Multiple year contracts, such as a three-year lease, don’t always equate to saving money. Make sure that you review all yearly contracts at the end of their term to determine if you have the option to get a better deal. This tip takes time, but it’s well worth it.
- Get feedback. You can get feedback from your staff members, others in your industry, and even from your clients. You’d be surprised at the number of great ideas that others have about ways you can control your business expenses.
- Cut down and shop around. Cut down on expenses. Can you save money by purchasing certain items in bulk? The key here is to make sure that you’re only buying items in bulk that you’ll actually use. Make sure that you shop around with vendors to find the best possible prices.
- Use energy efficient technology and lighting. Although the newer lightbulbs are more expensive, the savings are great. You’ll save not just on your electricity but also on how often you have to change out your lightbulbs. Make sure that you are using energy efficient technology. Turn off your computers and other devices at night when you leave the office.
Review Your Profit Margins
When a lot of people first start their businesses, they have lower profit margins because they think that undercutting similar providers will bring in more business. Sometimes it will, but it also results in doing more work to make the same profit as your competitors. So, you should take the time to review your profit margins. Maybe you elect to not raise your prices with current clients, but you increase prices for incoming contracts. David Finkel, co-author of Scale: Seven Proven Principles to Grow Your Business and Get Your Life Back, wrote an excellent article with five tips on how you can increase your profit margin. Tips include decreasing your turn around time and retaining your current client base.
In the day of Facebook advertising, it may seem a little strange to read an article that says you should look for more organic advertising means. We are not saying that you should never pay to do a good Facebook ad campaign or other paid marketing. What we are saying is that it’s important to understand how to setup the best campaign possible to reach the most people for the least amount of money. Unfortunately, many people do not understand that there are a lot of detailed choices that must be made to reach their target audience. If they aren’t reaching the right people, their advertising dollars are wasted. That’s why organic advertising is important.
Organic advertising is low cost or free ways that you can use to advertise your business. This could be as simple as using the Internet to look up various businesses that would be interested in your services and writing a letter or some kind to introduce yourself. It could be starting a blog or a newsletter to introduce your services to your target market.
Sell to Existing Clients
It is much easier to sell to people who already know your business and your services than it is to acquire and convince a new client to buy from you. So, make sure that you’re contacting your existing client base on a regular basis to offer them new services and to just touch base. Touching base is important because it keeps you at the front of their minds. This is a great way to keep the door open for future sales. You could also use this opportunity to ask for referrals.
Focus Your Time on Growing Your Business
Clients ARM is the premier back-office, remote solution that enables small business owners just like you to focus their time on growing their business. Instead of focusing on your client intake, customer service, billing, and collections, you can continue to service your clients while leaving those important aspects to Clients ARM. Why choose Clients ARM? We have more than 30 years of director-level experience. Partnering with us saves businesses around 40% of the traditional costs associated with hiring an employee. That means you get to work with an industry leader for a fraction of the cost. Ready to learn more? Clients ARM is currently scheduling free process reviews for small business owners who are ready to take control of their time and improve their bottom lines. Contact us now to schedule your free, no-obligation process review.