4 Steps for Improving Profitability
Increasing sales don’t always mean improving profitability. Sales and profits have to consistently be monitored closely. If you are only paying attention to your revenue line, you may be growing your business but bringing in less money. I have seen business owners lose money with every new sale. Stay on top of improving profitability with these tips.
- Know Your Numbers
- Review your revenue and expenses month.
- Watch for unexpected revenue trending downward and unexpected expenses trending upward.
- Review your monthly expenses for services you no longer use. Dump those subscriptions you haven’t used in months.
- Check Your Pricing
- Review your pricing strategy annually.
- Are you giving away too much for free? Reconsider how much you charge the client who is putting the heaviest demands on your resources.
- Compare your offering against your competitors. Are you charging enough?
- Lower Your Expenses
- Review your costs annually. If you have been with the same vendor for years, you may miss out on savings they have passed onto other clients.
- Get quotes from different vendors on your key inputs and expenses.
- Where can you eliminate redundant expenses?
- Generate New Revenue Streams
- Repackage your offer to appeal to other segments in the market
- Encourage and reward your sales team for upselling and cross-selling your existing clients.
- Stop selling low profitable products or services.
Improving profitability is an easy way to grow your business without adding costs or hiring more salespeople.
Ready to improve your profitability?
Let’s talk. Book a discovery call today and get the clarity you need to grow your business profits.