In any business, and especially a small business, there can be countless valuable “potential” profits literally hiding right in front of you. For a small business, figuring out what those gaps in your profits are – and where they are hidden in your day-to-day activities – is almost as valuable as what you do about them afterward. Here are three profit boosts to help you locate the gaps in your profits and effectively turn them around.
Profit Boost #1 – Work More Effectively with Suppliers.
When you study your patterns from suppliers, explore the idea of earning quantity discounts that grow cumulatively over a year. You will then play on a larger field simply by purchasing what you were going to buy anyway. Negotiate higher discounts for increasing volumes and quickly earn them as you go. It is a win-win for both you and your supplier (because you will almost surely be guaranteed to use only them) and it definitely shows up in your P&L.
Profit Boost #2 – Reduce Expenses around Debt
One of the most important ways to maximize profit is to explore ways to reduce moneys from expensive sources. Cutting the cost of credit is a highly effective way to improve your bottom line, month after month. First, take the time to analyze all of your sources and then rearrange or reschedule terms, consider accelerating inbound payments and delaying outbound payments wherever feasible. The savings will go directly to the profits line of your income statement.
Profit Boost #3 – Analyze the Buying Habits of Your Clients or Customers
When you scrutinize the buying patterns of your top clients or customers over the last twelve months, you can easily discover potential opportunities for hidden profits. What are they buying? And why are they buying it? When are they making purchases? Mine that data closely and get super creative to potentially increase their order size or to bundle service packages with other products, for instance.
If your product is an essential component of theirs, your customer's forecast can be very closely aligned with yours to increase order predictability and more accurately map out your revenue stream (and expense flow).
Finally, explore ways to decrease your processing and shipping costs, and look for opportunities for recommendations – for your customers to offer your products and services to their customers.
You can boost your profitability over the next few weeks.
Donna Marie Thompson, PhD
Creating your best profit solutions is my highest priority.
http://www.expertprofitsolutions.com
PS: For more information please click on the link to get my Special Report: "3 Profit Pitfalls and How To Avoid Them."
Remember – Just say no to the status quo!
Get your own copy of the free special report: "3 Profit Pitfalls and How to Avoid Them" athttp://www.ExpertProfitSolutions.com.
Donna Marie Thompson, PhD is a Small Business Profitability Expert and Founder of Expert Profit Solutions. She is a two-time best-selling author who has spent most of her career problem solving in international management consulting.
Donna Marie has helped businesses meet their profit targets under challenging circumstances. She was a Director at PricewaterhouseCooper's Consulting, and has worked at Booz Allen, as well as local consulting firms. This wide range of experience in businesses of all sizes uniquely qualifies Donna Marie to guide small businesses to discover their hidden profit potential.
Donna Marie earned a PhD from George Washington University, an MBA from Virginia Polytechnic Institute, a CPA in the state of Maryland, and is a Master Practitioner of the Energy Leadership Index.