There may be many factors at play for those businesses dealing with flat profits every year, or no profit at all, from the health of the whole economy, to consumers changing needs and desires. Whatever the reason behind a businesses’ dire bottom line, it will not be able to survive for long with little or no sign of improvement, so what can companies do to get profits growing again?
Generating more sales while cutting costs is the magic formula that any successful company needs to follow to see a rise in profits. Administrative costs should be kept at a minimum and cross selling can be one solution for this. Offering customers new products or services that enhance and complement what you are already offering, can be successful if carried out well, such as a hairdresser selling shampoos and other hair care products.
Check also to see if there are any processes related to the running of your business that can be reduced, automated or outsourced.
An effective and innovative advertising campaign could be the difference between success and failure for any business, and remember that if you want folks to buy your product or service, they need to know that you exist, and they need to be able to see you without having to search high and low. Make the most of free advertising on social media sites and design an attractive and inspiring campaign or even a webinar. Some advanced forms of software can help you measure the return on investment for your online marketing campaigns. You may even be able to partner with other businesses for advertising purposes.
Try offering your customers discounts for prepaid payments or subscriptions, and with regards to accounts payable, do your best to ensure that all payments are timely to avoid costly penalties.
If you can automate accounts receivable, customer lead management and employee productivity tracking, then do so. To know whether your business could cope without the physical staff who fulfil these roles, track them to find out who may be dispensable.
Anybody and everybody within your company who has any contact with customers, should be up to speed with your products and services, know how to sell them and how to treat customers appropriately.
Late paying customers can be a blight for any business, and if yours has a lot of them, you might want to consider revising your credit terms or offering less credit. You might even want to employ the services of an outside company to help you collect late fees.
All good bookkeeping companies will help businesses to boost their bottom line and better manage their cashflows, so if you haven’t engaged with a reputable bookkeeping firm yet and your profits are stagnant, perhaps it’s time that you did.