Strategies to improve sales and profitability
Ten tips to increase profits
By reducing costs and increasing turnover and productivity you can improve your business' profitability. Healthy profit margins can make it easier to plan for change and growth. Try some of these key ways to increase your business' profitability:
- Identify areas in your business that you could improve or make more efficient - eg production or administration. Read about process and resource efficiency.
- Use key performance indicators (KPIs) to discover your weaknesses and problem areas, such as rising costs or falling sales, and address these. See how to measure performance and set targets.
- Find ways to reduce your business waste - this can cut the costs of sending waste to landfill. You could also look at reducing your use of raw materials, or recovering energy from waste. Discover how you can reduce your business waste to save money.
- Regularly review how you price your products, and test new prices before making them permanent. See how to price your product or service.
- Group your customers into sales categories based on the volume of sales and profits generated - and adjust your pricing and marketing efforts accordingly.
- Sell more to your most profitable customers. Use up-selling, cross-selling and diversifying techniques to improve your profit margins. See how to target your most profitable customers.
- Negotiate better deals with your suppliers - for example, long-term deals might offer better value for money or, if you're ordering supplies in bulk, you might be able to get a discount. Read about choosing the right suppliers and find negotiation tips for dealing with suppliers.
- Look out for new business opportunities and chances to expand into new markets. Research potential new customers and how to target them. See how to enter new markets to increase profits.
- Routinely measure the efficiency of your operations and put monitoring systems and processes in place - eg benchmarking.
- Streamline all business processes where possible. Find out about process efficiency to cut waste.