If your sales are down and costs are hurting your profits, you’re certainly not alone.
The irony is you can do something about it.
Here are eight strategies:
1. Turn the problem into an advantage
Consider making a bigger product and charging a higher price.
If you have products with good margins, use them as loss leaders to entice customers to buy your other products.
2. Use traditional tactics
Start by determining your break-even point, which will be a catalyst for ideas.
Reduce the size of your product, if you think your customers won’t care.
Your customers might notice but many will still probably buy to avoid paying higher prices.
3. Recycle and reuse
Look for more ways to save money in your operations. Plan better delivery routes to use less gas.
Avoid or at least delay upgrading software.
Purchase pre-owned products. Partner with your employees and incentivize them to come up with money-saving/money-making ideas.
Business relationships are important. But if you can’t afford your vendors’ prices, try negotiating.
5. Change your vendors
If your vendors aren’t willing to negotiate, look for others with which to do business.
6. Close the office and go home
Work from your home. More and more businesspeople are using technology to telecommute.
Talk with your CPA.
You’ll avoid paying office rent, and you’ll be able to take a write0ff at tax time if you dedicate space for business.
7. Increase your prices
Hopefully, your brand is strong, and your customer satisfaction ranks high. Warn your customers and explain why you must increase prices, and express empathy and appreciation for their business.
Provide more added-value – if it doesn’t hurt your bottom line any further. Fine-tune your customer service.
8. Expand marketing economically
Bone up on social media, get more opportunities as a guest speaker, find strategic alliances for cross-promotion, write press releases and discuss possible trade-out opportunities with the media.
Radio stations are known to give free advertising in exchange for products and services.
If all else fails and you really feel you can’t raise prices – then don’t. Just accept your situation and keep on truckin’.
From the Coach’s Corner, editor’s picks for relevant articles:
Do You Know What Drives Your Profit? (There Are 4 Drivers) — For profits, entrepreneurs must learn how to manage their financials and performance, which are difficult tasks. Savvy business owners know who their ideal clients or customers are. Entrepreneurs realize financial benefits when their revenue from business exceeds their expenses and taxes. This results in a much easier task – deciding whether to save, spend or invest the profit back into the business. So, it’s imperative to know what drives profit.
Quick Checklist for Profits You Can Implement Today — Here is a top-10 checklist for profits: 1. Review and fine-tune your business plan. Be sure to discern your competitive landscape and benchmark your main competitors. 2. Bring on the A team – both in staff and advisors.
Elevate Sales via 5 Best Practices in Pricing and HR Training — Sophistication in pricing by salespeople is an excellent driver to grow earnings rather than just looking for ways to cut costs. Instead of growing their profits with sophistication in pricing, many businesspeople miss growth opportunities when they mistakenly cut muscle – usually in human capital and branding. Here’s a better way.
Profit Margins: 11 Tips to Increase Sales and Minimize Markdowns — Imagine being able to sell your products at full or nearly full margins. How would you like a dream situation – not having to mark down your products? It’s important to develop and implement responsive, multi-dimensional strategies to maximize your sales.
6 Rules to Keep Your Pipeline Full for Continuous Sales — It doesn’t matter what type of business you have. Even if your sales are great today, there will come a time when sales will crawl to a halt unless you take precautionary measures to keep your sales pipeline full.
“The worst crime against working people is a company which fails to operate at a profit.”