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Monday, December 9, 2019

C-Suite Advisory

Five Ways to Increase Profits for a Business

The aim of doing business is profitability. Few people start a company hoping that they won’t make money out of it. Owning a business is challenging. However, it’s all worth the effort when the organization turns a profit.

But just because your business is in the black, it doesn’t mean there isn’t more work to be done. Very often, owners will feel that all is well because they’ve made a profit. The question they neglect to ask themselves is whether they’re making the biggest profit they can.

Here are some ideas for maximizing your organization’s profits: 

  1. Buying practices
    A lot of businesses don’t make the profits they should because of unnecessary expenditure. It cuts into their bottom line. The buying process in an organization should be well-planned and straightforward.
    A lot of people fall for the idea of buying in bulk at a slightly reduced price. It may be to their advantage sometimes. However, it’s a risk. They could end up with a lot of stock that remains unused or passes its sell-by date.
    It’s important to anticipate the company’s needs and buy accordingly without making impromptu decisions that can lead to disaster.
  1. Productivity
    Inefficient processes and staff members drain an organization’s bottom line. Don’t assume that there’s no room for improvement that could make a drastic difference for your business. Eliminating paperwork or introducing some new technology can free staff members up to do other tasks that you might have hired a new employee to do.
    Doing a productivity analysis when you’re at the coalface can be challenging. It’s hard to look at the business from the outside to see where its areas for development lie. A lot of companies hire consultants like Carpedia to do a review. Afterward, they make suggestions for improving business operating performance.
  1. Marketing
    A lot of companies have amazing products and services. However, they still fail to turn a profit because they have not marketed themselves effectively. Without getting the word of their presence out to potential customers, they flounder and fade away.
    The marketing process involves identifying your target audience and catering your marketing tactics to reach those people. A blanket approach might seem more viable, but it won’t appeal to anyone.
    Do some market research to find out who is most likely to make use of your product or service. A lot of business owners assume that writing a flyer, email, or content for their website is simple when it isn’t. Poorly written copy will detract from your marketing efforts.
  1. Increased corporate and social responsibility
    It might sound like paying money to sponsor local charities and non-profits will take money out of your bottom line. But it won’t if you go about it correctly. You can use corporate and social responsibility to generate more sales and more profits.
    People are inclined to pay a little more for a product or service when they know that the company that produces it cares about the community. Showing the commitment to the upliftment of the poor or the preservation of the environment can generate increased media attention, making your business more visible.
  1. Offer incentives
    An incentive doesn’t always involve a reduced price. You can offer a voucher for future purchases for customers who refer you to others or those who make a purchase of a set value. Don’t cut prices across the board unless there’s no other way to get your product or service moving.
    When you are seen in the market as offering fair prices, your reputation is enhanced. The same happens when you reward customer loyalty. It will generate repeat business, which translates into business sustainability and profitability.

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Ryan Miller
Senior associate editor at ​the CEOWORLD magazine. Raised in Boston with a Brooklyn accent.
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