We are constantly seeing on social media and advertising everywhere how to get your 6,7 or 8 figure businesses. Most of the time they’re talking about sales and this all sounds amazing.
It’s not about the money you make but about the money that you take.
It sounds great making £100,000 in sales but what if your costs are £90,000. Taking home £10,000 no longer sounds that impressive. So in order to hang on to more of that hard-earned money you need to be focused on not only increasing your revenue but also spending less. Controlling costs, being resourceful and working smarter, not harder, is the secret to increasing your profits.
Here are 4 strategies you can use to boost your bottom line and profitability in your business;
1 - Cut down overhead costs
One way to boost profitability is to find ways to reduce your costs without it’s impacting on the productivity and quality. Take a good look at your expenses and see if there are any unnecessary subscriptions and services you can trim. You should also always shop around and seek out new quotes for example your insurance when that’s up for renewal or your Internet and office supplies to make sure you’re always getting the best price, switching can save you thousands. If you need to stay with the same supplier then make sure you negotiate prices every year, you never know what deal you might be able to get.
2 - Tighten credit terms
Late paying customers can be a nightmare for small businesses when customers are frequently late to pay you may find yourself dealing with costly cash flow problems and lots of mounting debts. To get on top of this before even becomes a problem it’s worth reconsidering your payment collection procedures and your credit terms.
Introducing late payment fees is likely to encourage your customers to pay on time and if not at least you’ll be compensated for the costs and inconveniences of their late payment.
You should also review your payment cycles with the software ‘s out there is easy to have instant invoicing and digital payments and therefore payment terms of more than a week can be considered generous so payments terms over 30 days aren’t usually necessary.
3 - Increasing productivity
Research undertaken by GoRemotely suggests that productive employees equate for 21% increase in profits! Of course, it is therefore in a business owner’s best interest to make sure employees and themselves are productive. One way to increase productivity is just making sure that the staff are happy and satisfied with their jobs. Investing in training for yourself all employees will make sure that everyone is skilled and working to the best of their ability.
Embracing technology and streamlining your processes will also help you and your employees save so much time and therefore money.
4 – Smarter Marketing
When you’re marketing you don’t need to pour money into fancy campaigns, instead look at which marketing strategies are generating you the biggest return on your investment and focus on these. Don’t just look at new sales either as well as growing your customer base it is also important to find ways to increase your sales to the customers you already have, such as upselling or return customers. Selling more to your current customers will increase your sales and help you reduce costs too, resulting in bigger profits.
As you can see increasing your profits isn’t all about getting more sales and reaching the next milestone nor is it about slashing all of your costs. It is about focusing in the right places to boost the bottom line in your business which you can do with the sales you’ve already got.
Put these four strategies into place in your small business and you will see the costs reduce Creating a more profitable business and set you up a financial success.
Get ahead, get it done.
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Thank you for reading this weeks blog – 4 Strategies To Boost The Bottom Line In Your Business.