No More Costs to Cut? Practical Tips to Grow Your Business and Improve Your Profits

January 29, 2011 by  Filed under: Management 

Over the last few years businesses have acted vigorously to remove excess costs and trim the workforce. Reducing costs further is likely to damage the business.

So what can pragmatic and positive business leaders do to equip their business for the months and years ahead?

Review your offer. Which products/ services make money? Where are the ‘profit drainers’? Unless of strategic value, consider dropping some of the latter and focus your resources on where you get a good return.

Given that raw material and commodity prices are escalating in general take a look at your products and their constituent parts. Can savings be made in packaging, raw material content or could the product be reshaped in some way to offer the customer additional value without the cost? Setting a ‘focus group’ to work on such a challenge in your business could produce remarkable results.

Consider your supply chain. Major benefits can be achieved in profit, cash flow and efficiencies if a ‘how can we improve our business relationship’ mindset exists when talking to suppliers. Who talks to your suppliers? Are they successful at presenting and negotiating? How much could your business gain from improvements in supplier terms and service and what could you offer them? – have a good, hard look!

In times like these really effective salespeople will demonstrate their value. As an example, despite the cost increases faced by many businesses currently many organisations shy away from selling a price increase by saying ‘it is not possible in the current climate.’ These businesses will count the cost. Price increases are a fact of business life and most customers will pay more for goods/ services if they fully understand the background and cause and if this is spelt out to them in a specific, lucid and constructive way. They naturally seek a ‘win’ out of the equation too and the skilled sales negotiator achieves this.

How skilled are your key salespeople? If they have the capability but not the skill, train them – you will reap bottom line rewards far exceeding any investment costs. If you are ‘carrying’ people and despite your efforts no improvement is being shown, you need to think about making changes or be prepared to pay the price in inferior market performance. Make sure that when recruiting you undertake a campaign that attracts the right individuals. Attention to detail and a quality campaign will bring in people who really will make a difference to your top and bottom line.

Now is the time to act and think positively about the future and adopt a ‘half full’ perspective. By making adjustments to your business in some of the areas mentioned above, great strides can be made. This puts your business in the best position to ‘ride the storm’ and emerge the other side ahead of the competition to take full advantage of the inevitable upturn.

Mark Simmons is a Director at Tinderbox Business Solutions (http://www.tinderbox.uk.com) who provide expert business advice across a wide range of industries, sectors and disciplines, helping businesses to identify opportunities for growth. Tinderbox provide practical solutions and real-time support, helping businesses achieve measurable results that will bring about a demonstrable return on investment.

Article Source:

http://EzineArticles.com/?expert=Mark_D_Simmons

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