| 10 Ways to Boost your Profitability | | | | are a nice addition to more active forms of |
| So many business owners work hard - really hard | | | | marketing such as meeting people, calling people |
| - just to break even or keep afloat. Each one of | | | | and speaking to people. However, brochures and |
| us deserves reward for our efforts, whether that | | | | business cards, no matter how beautiful, do not |
| be financial or personal. The question to ask | | | | replace direct contact. If you are spending money |
| yourself is whether you are directing your effort | | | | on flashy marketing materials in the place of |
| in the right places, to get the reward you want? | | | | marketing directly, your profitability will suffer. The |
| Of the businesses I've seen and worked in, there | | | | most effective form of marketing comes from |
| are plenty of ways to mis-spend effort - that is, | | | | you talking about your business to others. |
| to work hard - but on the wrong things. Here are | | | | Marketing materials are an expense, and to be |
| ten of the most common areas where the return | | | | sure they are working, you need to get some |
| on your efforts can really be ramped up. | | | | handle on the return on your investment. At the |
| 1. Marketing Inconsistently | | | | very least you should be tracking where new |
| Once you have committed to owning and running | | | | business is coming from so you can get an idea |
| a business you must be equally committed to | | | | of whether your marketing materials are |
| marketing and selling the products and services of | | | | contributing to any new business you get. |
| that business. It is difficult, if not impossible, to | | | | 7. Spending a significant amount of time in |
| stay and remain profitable without a commitment | | | | low-return activities |
| to ongoing concerted marketing. | | | | Don't we all know about this one! If you are |
| To get more out of your marketing, create a | | | | spending the majority of your day completing |
| simple marketing plan that includes marketing | | | | tasks which are administrative in nature and/or |
| activity every day, every week and every | | | | which can be easily completed by other people |
| month. Marketing plans combine formal activities | | | | then you are not putting yourself to best use. For |
| (such as advertising, promotions and writing) with | | | | most of us, the best value-adding activity we can |
| informal activities (such as making new contacts) . | | | | be involved with is in bringing business in the door |
| Don't underestimate the power of talking to | | | | by building relationships, talking to prospective |
| people about what you do. Use every | | | | customers and promoting our business. |
| opportunity, every time. | | | | What value do you put on your time? Assign |
| 2. Fear of Asking for the Sale | | | | yourself a competitive hourly rate for the market |
| Isn't it true that we think asking directly for | | | | and industry you work in - it might be anywhere |
| someone's business means coming across as | | | | from $100 per hour or upwards. Then ask |
| pushy or obnoxious. But if we have this attitude, | | | | yourself whether you would pay anyone that |
| we are letting profit-producing opportunities pass | | | | hourly rate to process accounts or do |
| us by. Worrying more about what someone | | | | administrative work. If the answer is no, find a |
| thinks of you than bringing more money into the | | | | way of getting these low-return activities done |
| business is an all too common mistake. If you find | | | | for a lower hourly rate. Hire a bookkeeper or |
| it difficult to "ask for the sale", you can be sure | | | | assistant for a few hours a week, and spend |
| that you're not bringing in as much money as you | | | | your time doing the valuable work. |
| could be. | | | | 8. Not charging enough for what you do. |
| The most effective way to address this issue it | | | | This challenge seems to arise especially for people |
| to practice asking for the sale in language that | | | | who sell services. Either we feel embarrassed to |
| you are comfortable with (not too wishy-washy | | | | ask for the amount we want, or we simply |
| please). Write down what you want to say first, | | | | accept less money than we need - so we get |
| then practice it over and over. There is also | | | | "some money" rather than "no money". But |
| plenty of stuff out there on handling objections. | | | | beware, after a while, working for too little can |
| Prepare your responses to the most common | | | | leave you exhausted and resentful, not to |
| objections so you are well armed before you | | | | mention the impact it has on your profitability. |
| speak with your prospective customers. | | | | You do not need to defend an increase in your |
| 3. Getting help | | | | fees either. It is normal business strategy to |
| Most business owners possess strengths in one | | | | review fee structures, make changes and advise |
| or two specific areas, but whether by necessity | | | | customers. And contrary to our fears, it is often |
| or design, they often end up working in areas | | | | the case that business levels improve after fees |
| they aren't strong in. This builds inefficiencies and | | | | are increased. It seems that we attract a whole |
| potential for mistakes into the business. To | | | | different class of customer when our fees reflect |
| compound the problem, we don't ask for help | | | | the value we provide. |
| straight away, but struggle on doing the stuff we | | | | 9. Not making enough use of technology which |
| are not suited to (saves money right?) But each | | | | could save time and effort. |
| day that goes by with your business running at | | | | As a business owner, you have a fixed amount |
| less than maximum efficiency, means dollars lost | | | | of time and energy within which you must |
| from your pocket. | | | | maximize your profits. Technology can help you |
| Work out where you add the most and least | | | | do this in the form of autoresponders, voicemail, |
| value in your business. Pay someone to help you | | | | wireless internet connections, speech recognition |
| out with these low value add activities. Your time | | | | software, SMS from your computer and so on. All |
| is best spent where you add the most value. If | | | | of these tools are widely available to us, and are |
| you can do more of this kind of activity, your | | | | designed to save time and effort. Each of us |
| business will benefit. | | | | needs to continually look for ways to make |
| 4. Use your Existing Customer Base | | | | business processes more efficient by using |
| All the research tells us that it is easier and | | | | inexpensive technology. |
| cheaper to keep working with customers you | | | | Often the problem is that we don't know what |
| already have, than to get new customers into | | | | we don't know. Some wonderful tool might be |
| your business. If you are not following up with | | | | available but we don't know it exists. You need to |
| past customers on a regular basis you are | | | | stay on top of the latest products by regularly |
| reducing your profitability potential. | | | | checking in with business and telecommunications |
| Develop strategies to keep your customers with | | | | sites. |
| you, such as loyalty plans, regular communications | | | | 10. Sticking with outdated business models or |
| and special offers. Implement a regular process | | | | plans. |
| for following up your customers after they buy | | | | You've all heard it before - doing things the way |
| from you. | | | | they have always been done means that you will |
| 5. Managing Expenses | | | | get the results that you always got. If you are |
| Savvy business owners regularly appraise their | | | | not satisfied with your results then you need to |
| business expenses and find ways to reduce costs | | | | re-look at what and how you are doing things. An |
| without sacrificing quality. If you haven't | | | | astute entrepreneur has a mindset that is always |
| completed a cost analysis lately, you might be | | | | challenging the way things are done in the |
| paying more than you need to be, which will | | | | business. |
| reduce your profitability. | | | | Another great way of coming across new ideas is |
| At least once per quarter you should review your | | | | to attend seminars and conferences on various |
| expenses and negotiate for adjustments as | | | | topics. If you get a single idea to put into practice |
| appropriate. Categorize everything you spend | | | | in your business, then that seminar has been |
| under 3 headings: Essential, Nice to Have and | | | | worthwhile. |
| Non-Essential. Everything in the last two categories | | | | If you are serious about improving your business' |
| is up for grabs - be ruthless! | | | | profitability (and aren't we all?), then taking action |
| 6. Spending large amounts on glossy, slick | | | | on these areas will help you make more money |
| marketing materials and expecting business to | | | | and have more fun in your business. And that's |
| pour in without any additional effort. | | | | what it's all about really. |
| Glossy brochures and slick marketing materials | | | | |