Business appears to be
good, eh? Selling things doesn't mean that you'll reap the rewards of your
effort...profit! Sometimes sales can actually hide fundamental faults or issues within
companies, both large and small. Getting more sales, while making a profit is the name of
the game and here are some suggestions:
productivity by expecting 25-50% more from everyone. Yes, this is a
bold statement, without a bold goal and communicating it, nothing is likely to happen.
However, you'll also have to provide the best tools and training needed to produce more,
without the stress.
your product/service line. Look for ways to add more to your existing
business. Ideas that do not add to inventory levels or require heavy investments in
machinery or equipment are the ones to go after.
your assumptions about the marketplace. The truth is profit is
temporary. By challenging our assumptions about our Customers and what they want will keep
us in touch with the changing world around us.
the top 20% of your Customers and talk to them. Simple, yet most
business do not talk to their Customers. There is a strong belief by many that it is not
the share of market' that leads to success but the share of Customer' that
leads to profitability.
in new products and services. Take 1% of your sales and invest it in
new products or services, not a huge risk and over time you will find something that
produces additional profit for you.
people and have people who exhibit traits of strong self-initiative and competence.
All other employees are average and your business will produce average results.
Exceptional employees generate exceptional ideas, exceptional ideas lead to exceptional
the books to your employees, and share in the profitability of the company.
When people know what is going on, the role that they play in accomplishing the goals and
realize that something is in it for them, they will support the company. And, instead of
leaving and starting their own business [thus increasing your competition] they just might
stay and contribute even more.
all of your Customer complaints. One bad experience by a Customer and
he/she will tell at least 10 others, something you don't need. Don't rationalize what
happened concentrate on getting rid of the causes.
a marketing program that sells. Most marketing and advertising
programs can be described as stuff being sent out'. Customers buy for two reasons:
solutions to problems and/or good feelings. Your marketing and advertising programs should
position your company accordingly. If your program doesn't do so, either revamp it so that
it does or don't spend the money.
automate, automate. Technology can be scary, and in my view, life
without technology would be worse. The real benefit of using technology is that it forces
you to establish patterns, templates, norms, procedures and you'll accomplish much more in
shorter time frames.
Bonus: Demand that your accounting system be more than a recorder of
debits and credits' and that it contributes valuable information about your
business, your products and your Customers.
Increasing sales doesn't necessarily mean there will be
more profit. The fundamentals of business, marketing and advertising, finance, and
operations contribute greatly to a profitable company. Chris Egsgard, a dear friend (and
fellow entrepreneur) corrected me the other day, when I said that "knowledge is
power", Chris said: "knowledge plus energy is power". It seems to me that
you now have a number of key ideas about how to make your business more profitable, go
forth and do something about it!
Feel free to use this
article, just give credit where credit is due!
Copyright 1997 © Sid Ridgley