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Wondering how to make your business more profitable? Check out these tips in today's contributed post!
Profit margins are the bread and butter of any business.
Companies are always looking at innovative ways to improve their profits without sacrificing the quality of the product or service they provide. For small businesses, this often takes some out-of-the-box thinking.
If you’ve been struggling to brainstorm ways you can make your business more profitable, here are five ideas to get you started.
Standard operating procedures (SOPs) add structure to your business and can help your team focus better.
Also the usage of timesheet templates can help increase team's efficiency. By outlining scheduled steps, you create habitual practices that become second nature to those completing a task.
These SOPs become the ultimate “how to” guide and help keep things moving forward if a key employee is absent.
To create SOPs, look at all the various tasks being completed daily, weekly, and monthly within your business.
Evaluate the processes and see if there are ways to streamline them. Record the process and refine as needed.
Having a strong operating budget is essential for running a profitable business, but failing to track expenses can cost you jumping into a debt. R
ather than looking at the total budget and determining whether you were over or under, take a closer look at where your money is going.
If travel costs are adding up, consider a new approval process for trips or investing in video conferencing technology.
If you’re spending a lot on business subscriptions, evaluate what tools are critical for success and which ones aren’t really delivering as promised.
Make your goal for 2019 to stay away from the debt and make cuts as needed.
The quicker you’re able to process an order and send out an invoice, the quicker you’ll get paid.
Creating a strong invoicing strategy (and pairing it with an SOP) can help your business get paid quickly, improving your cash flow and profitability.
Re-evaluate your payment terms with customers and consider adding rewards for early payment.
Of course, strong invoicing policies are built on the foundation of a well-developed customer rapport-- the more your customers like you, the more likely they are to pay you promptly.
Related: How To Make Money: 2019 Guide
Once your customer decides to make an initial purchase from you, it becomes easier to sell them more. This effect is beautifully portrayed by Amazon, as they showcase similar or complementary items once you add an object to your cart.
Consider adding a tripwire during an online shopping experience that encourages customers to purchase more. Tiered pricing strategies and discounted upgrade packages also have positive results during the sales process.
For an upsell to be effective, you need to operate on the basis of psychological marketing. Elicit an emotional response or create the feeling of scarcity for best results.
Related: Small Business Money Management Tips
Many people fear that automation will replace human workers when in reality, it gives your employees an opportunity to focus their efforts elsewhere within your business.
Automated appointment reminders and email marketing funnels are two of the best ways to build a customer relationship with minimal effort.
Automate reports and procedures to streamline procedures and handle more tasks with fewer people.
With the right tools and practices in place, you can make your business more profitable without making any substantial changes.
Every little bit counts and a small change this month could yield massive returns by the end of the year.
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