Below you’ll find the top 10 ways for your business to increase profits – after all, who doesn’t want to see more business profits? That’s the whole reason you got started, so don’t miss out on these tips! Some are specific to businesses that sell products but the general points apply to all businesses – whether you provide a service or sell a product.
1. Reduce overhead costs to increase profit
The bottom line: the fewer overhead expenses you take on, the higher your business profits will ultimately be. You can do that by flat-out eliminating some of those overhead costs, for example by making room at your home to store your inventory or by learning to repair your own equipment without the help of a technician. You can also reduce overhead costs to increase profit by finding better deals or by negotiating with your current service providers for better rates, or refinancing existing debt.
2. Get rid of processes that don’t add value
The bottom line: you want to free your business of any processes that don’t have a high-enough ROI (return on investment).
3. Find your most profitable products
The bottom line: pick out the products that make you the most money and put more energy into e-commerce advertising for them. Stay focused on your money-making items and do what you can to generate more sales for them.
4. Optimize your inventory management
The bottom line: you can optimize your inventory management and business profits by:
- Owning or renting a warehouse that you have some control over
- Considering dropshipping which will help resolve stock level issues
- Working in sync with seasonal changes (e.g. change items offered, minimize inventory sizes, etc.)
- Using an online inventory management system
5. Increase prices to optimize business profits
The bottom line: there’s nothing wrong with raising your prices in an effort to increase profits, as long as you’re providing customers with some form of compensation for those higher prices.
6. Sync with your team members
The bottom line: with reliable systems for communicating with one another, team members can ensure that issues are avoided or at least resolved in a timely manner. Listen to what team members are saying about how to increase business profits – they may have very useful insights to give!
7. Streamline operations
The bottom line: Rough edges in your business operations can create real drag on your business profits. Smooth out those sharp corners with the help of technology and some good old fashioned attentiveness!
8. Save on rent
The bottom line: you never know if you can get a better deal on your rent until you ask. At the very least, you can use it as an opportunity to ask for them to not increase the rent when you re-sign the lease (which can help business profits later on down the line).
9. Increase sales efforts
- Individual rewards for a set amount of sales (e.g. TVs, spa vouchers, etc.)
- Group or team rewards (e.g. trips, gift cards, etc.)
- Create a loyalty program that offers rewards
- Tell customers of upcoming special offers
- Send out free samples (if applicable)
The bottom line: giving employees a push to make sales or giving customers a push to make purchases doesn’t mean you need to dip into your business profits. Set up those reward programs so that they only trigger when your employees or customers have passed a certain threshold of sales or purchases.
10. Make purchasing easy for customers
The bottom line: keep your store’s purchasing process smooth and simple for your customers. Give them the ability to create an account and save their payment details if you have an e-commerce store so they can do quick checkouts next time. Use a merchant service provider that offers a number of payment options for your customers. Just make it easy!