There are numerous ways to increase you profit. Small changes can make a huge difference to the bottom line.

Reducing costs and increasing sales are the 2 main ways for most businesses.

With costs there is a finite number of ways and limits to the reductions that can be made, however, increase your sales and as long as your margins are OK, this is the quickest way to generate more cash.

It really is worth looking round for a better deal with most of your suppliers. If you have been with a particular supplier for a long time they are more likely to be open to negotiation as they will not want to lose your business.

When insurance comes up for renewal look for a better broker that will do the hard work for you. He should be able to negotiate on your behalf and could save you thousands. In my corporate life I often saved companies thousands by shopping around for insurances, it is a very worthwhile exercise.

You should review your utilities, telephone and internet providers regularly as they are so many options to choose from and they all want your custom. In my experience I have saved companies over 60% of their bills by keeping a look out for better deals.

Another way to reduce costs and overheads is to streamline your systems and processes. A robust accounting package would make sure that you had up to date, relevant information that would allow you to monitor your margins, compare actual v budget figures, and be able to see clearly where any overspend was happening. This would help eliminate wastage both in terms of time and materials.

If your staff have the right tools to do their job then they will be working more efficiently, and a piece of software, or a clear procedure, could be the tool that they need.

Once you have the correct systems, processes and procedures in place, and have them documented clearly, you will be able to monitor the performance both of your team and your company. Key performance indicators or KPIs for short, give your staff something to focus on and will give them goals to work towards. Just make sure that they are the right critical indicators for your business; if in doubt get advice.

You and your senior team need to be working on taking the business forward and growing, you don’t want to be wasting time on simple tasks that can be delegated to junior staff on a much lower pay rate.

By linking pay and benefits for staff to the company’s performance, it will make them more productive and motivated on helping the company to succeed.

The internet and social media have really taken the business world by storm over the last 20 years. Using the internet and social media to sell and promote your business is not only free but it means you can reach markets that before would have been very difficult to gain access to.

Strategic alliances and joint ventures open up new distribution channels and mean that suddenly you have the resources  to tackle projects that before you might have turned away, due to lack of knowledge or manpower.

You need to be chasing sales and should have members of staff that focus on bringing in business. Don’t just sit there are wait for the phone to ring! If you don’t look after your customers your competitors will, so have good customer service procedures in place, and look at nurturing customers so they will be with you for many years.

It is well worth credit checking all new clients and setting a credit limit for them.

Have a range of products and services and always be able to offer clients an up sale of what they currently purchase from you.

Look at your profit margins regularly, and put them into 4 categories:

Eliminate – Low % of sales + low profit margins

Sales push – Low % of sales + high profit margins

Increase price, reduce costs – High % of sales + low profit margins

Keep doing it – High % of sales + high profit margins

Working out your gross margins for all your product ranges individually, will give you a much clearer picture of where money can be made within the business.  You can then focus on the ones that work.

If you would like any further information then please feel free to contact tina.parker@nozeyparkers.co.uk or ring 07784 611399. Full details are on our website

It has been reported that 8 out of 10 businesses fail within the first 18 months. Here I talk about the main reasons why this happens.

1.        Unexpected growth.

If your business suddenly doubled in size, could you cope?

Could you react quickly enough, or would everything crumble around you?

Try and make your business scalable. Put things in place so that you can grow effortlessly.

With the right systems & processes in, and the appropriate staff, you will have a fighting chance of surviving.

2.        Poor cash flow.

You need to make sure that there is always enough cash to support your business.

Don’t make the mistake of using the business funds for personal use. I have seen so many companies where the MDs have helped themselves to funds in one way or another, and have left the company with cash flow problems and unable to pay HMRC debts and sometimes have left the companies short for pay day!

3.        Not knowing their customer’s needs

Within each of your customers is the key to your success. It is in knowing their goals, dreams, values, pains and behaviours. Know these and have the answers and solutions for them, and you could have a very successful, long term business. Make sure though that this is followed up with good customer service. Once you have a customer on board, look after them.

4.        Not being unique enough

What is your USP? What makes you different and stand out from the rest?

More and more people are leaving the corporate rat race to start their own businesses. Everyday your competitors grow in numbers. You need to be different to get a good share of the market place.

5.        Not communicating their message clearly

Be concise, clear and compelling.

Your words must make it easy for your potential customers to know what you are selling, how it benefits them, and how to buy.

6.        They don’t invest in personal development.

You need to keep learning. You cannot know everything!

Take the time to continue to add to your knowledge and expertise.

Get a coach or a mentor. This will give you the motivation and drive to take your business to the next level.

7.        No clear profitable business model.

Is there a market for what you are selling?

Do you have various income streams?

This really is the one that will make businesses fail. If you cannot get people or companies to buy from you, on a regular basis, you have not got a business!

8.        The owner is lacking drive.

For your business to succeed you must have a passion and love for what you are doing. Challenges will come and you need to be mentally and physically robust.

Don’t be afraid of making mistakes. This shows that you are trying! Learn from them and move on.

9.        No clear business plan.

You need to know where you want the business to go and how you are going to take it there.

Not having a tight control on the financial state of your business can only lead to disaster.

You will need a business plan to secure additional business funding from a bank or finance house.

10.   Poor location.

Opening a hairdressing salon in a road where there are already 3 others, is a really poor decision.

Likewise – If you are running a shop at the end of a dead end road, the likelihood of any footfall past your door is none. This means you would have to be exceptionally well known and be selling exceptional products for people to grace your door.

11.   Not being a good boss.

Good people management skills are essential if you are taking on staff. You need to be able to make sure everyone is supporting the company’s core values and each and every one of your staff feel valued, they feel that their skills are being fully utilised, and that they have the right tools to do their job.

If you are going to be successful, your staff are the ones that will help you get there. Choose wisely and then nurture.

12.   No marketing & sales plan.

You and your team need to promote your brand at every opportunity.

Remember not all advertising works for all markets. Do your research and find out what will work for you.

Having an online presence is essential in today’s business world. Potential customers will expect you to have a website and be active on the leading social media platforms.

Remember you have many competitors. If they are doing it right then they will probably get more business than you. Don’t give them the satisfaction!

If after reading this you know there are areas of your business that need looking at, then please get in touch as I would love to help. Either call me on 07784 611399 or email at tina.parker@nozeyparkers.co.uk.