Four ways to maximise profits
If you are running your own business, then chances are that earning a healthy profit is at the top of your list of priorities – if it isn’t, it should be.
Obviously, your revenues will enable you to stay afloat as a business, employee a staff and support yourself financially. If your company isn’t making money, then how will it be able to spend money on these things?
The following are four ways to maximise your profits:
1) Internalise the profit motive
If you want to your business to stay open, then you have to earn a profit—period. The earlier you get this into your head and allow it to influence everything you do, the better.
ACTIONS: You can now alter your business model (whether that’s focused on your marketing needs, improving on leadership skills, etc.) and make sure that revenue is now a top priority.
2) Remember to always buy low and sell high
In the past, businesses may have been able to survive on lower profit margins—but this is no longer the case. Increased overheads and competition, as well as digital offerings that allow customers to compare your company’s offering with a basket of others, often in a global market, means that it is essential to have higher margins and repeat business if you want to survive.
ACTIONS: Use technology to your advantage; keep your eye on costs, particularly hidden expenses; focus on maintaining high margins and securing repeat sales.
3) Keep your numbers in mind
You obviously need to know costs involved in running your business, but you also must become familiar with numbers that will accelerate your bottom-line growth.
In order to multiply your bottom-line results, you will need to think about: leads; sales conversion rate; average sale; average number of transactions; profit margins.
ACTIONS: While generating more leads for your company can be difficult, start the overall process by trying to increase your profit margins.
You can always boost profits by raising prices. However, don’t go crazy; you don’t want to leave yourself exposed to be under-cut and drive your customers into the awaiting arms of your competition. Few people will notice a small increase in price.
Keep in mind that in order to stay in business, your company must earn a profit. While wealth may not be on your agenda, success most likely is—earning a profit will allow your company to become successful.
4) Know your Asian market
While ease of doing business has generally improved across the region (especially due to the formation of trading blocs) each country can still pose a challenge if you haven’t been in before.
ACTIONS: You will need to research what state the country’s infrastructure is in, as well as what regulatory issues you are likely to encounter, at the very least.
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