How to Boost Profits for the Second Half of 2018
We’re hitting the mid-mark of this year and if your profit margins aren’t what you had hoped and predicted, it could be time to make some changes. You might automatically think cuts in personnel and the like will be the first thing we’d recommend and, although some cuts will likely have to be made, there are plenty of areas in your business that you could tweak ever so slightly and see bigger dividends.
In the end, it really is all about the bottom line if you want to stay in business. Wondering how to boost your company’s profits for the second half of 2018? Read on for some suggestions.
Take Advantage of Customer Referrals
If you don’t have a referral system in place, now is the time to start. If people are happy with your company and/or products, they’ll likely want to tell others anyway. Reward them for it, see their motivation to do so increase, and watch more money roll in.
Cut the Fluff
If you’re offering costly services and products that are losing you money, what are you waiting for? Go leaner on your offerings and streamline what you do sell. You should also do an audit of your workflows and systems and cut out any processes that aren’t working well.
As this Inc.com article notes, “Every dollar you save by eliminating the cost of things that don’t add value to your company or to your customer drops directly to your bottom line.”
And, as painful as it may be, employee cuts could be necessary, too. You might have to run a bit leaner until profits pick back up. It’s also crucial to hire the right people in the first place. Transunion’s new employment background check service, ShareAble for Hires, is an easy online screening solution that takes just minutes to complete. It might seem like an oxymoron to invest in a service like this when you’re trying to cut costs, but placing a great employee in an open position now could save you thousands in turnover costs down the line-and improve productivity (and therefore profitability) at the same time.
Up Your Marketing Game
While cutting might be the name of the game in most areas, marketing efforts are the ones you want to increase. Boost your presence on social media, as that is the biggest way to reach customers these days. Using a social media marketing company like Metric Theory to streamline your social media efforts.
And people always like to get something for free, so offer tutorials, webinars, and podcasts whenever possible. Make sure to use a CRM tool like Zoho to measure which marketing techniques are working, and which ones aren’t.
Put a Sales Hat on All Team Members
Even if you have a sales department, spreading the word about your company and its happenings shouldn’t lie solely on their shoulders. Give all your employees a reason to want to brag about where they work. Whether you have some folks head up roundtable discussions or you offer incentives to anyone who regularly posts pertinent items on social media, everyone in the whole company can and should become walking spokespeople. In fact, you should hire Millennials, as they are known for sharing a lot about their work and work lives on social media.
Negotiate With Suppliers
Suppliers will often offer discounts for paying in cash and/or paying in full, etc. Don’t be afraid to ask about perks that you should be getting for vendor loyalty. Also, be diligent about checking your supplier bills. While it might not be on purpose, there are many times suppliers overcharge for goods or services. Catching these errors could save you thousands of dollars.
Up Those Prices and/or Drop Those Discounts
This can be a last resort but you can’t count it out entirely, as this will help your profitability. Customers know that overhead increases and, although you might lose the odd customer, the boost in profit margin more than makes up for this.
As an alternative, you might think about ditching your discounts. As Guest Writer Brad Sugars notes on Entrepreneur.com, “I once coached a men’s clothing store that regularly ran a 20 percent off promotion on men’s suits. If someone bought a $500 suit, the store lost $100 in profit. I counseled instead to give away a $100 shirt that cost $50. Customers perceived it as the same dollar value, but the store retained more money (and margin).” This same kind of logic can really be applied to any business.
Looking to end the second half of 2018 on a profitable high note? Follow these tips and you’ll be amazed at how quickly your bottom line changes.
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