Small Business Strategies to Increase Profits
Small business owners must focus on the profits right from the start because they have a limited budget. If your small businesses isn’t getting profits from the very beginning, the chances are likely that it will perish soon!
Is it that hard to generate profits for a new small business? The answer is NO if you follow the correct strategies. Remember, I am not saying don’t focus on branding because branding ultimately leads to sales. What I am saying is that your first priority should be profits because every other thing will fall in place if you start generating sales.
1- Leverage The Power of Networking
Networking is the art of connecting with others to develop professional contacts. Small business owners must capitalize on this strategy if they want to increase their customer base without spending a dime on marketing.
Here are some effective networking tips that every small business must try:
- Start the relationship not to sell products but to help others. Give some time to build your network and as the time progresses and the network matures, you will start to see positive results.
- Network with those who share common professional and personal interests instead of networking with your family and friends. This is what we call as “Affinity Networking” as it strongly helps to build great networking relationships.
- Learn how to communicate with others. Your style of communication, your body language and your choice of words can make a huge impact in your overall networking efforts.
- Get out of your comfort zone and create a networking goal for yourself. Make every effort to reach that goal each month.
2- Maximize Your Cash Flow
Adopt strategies through which you can lock your clients for a longer period of time. Retaining your existing clients and getting ongoing work from them is what will get your business running. It is not a good strategy to rely on the profits from new customers every month. Instead, you must generate profits from your existing customers.
Here are some strategies that are extremely useful in maximizing your existing cash flow:
- Set up ongoing payment plans for your clients on an yearly basis. Amazon Prime is a great example of such a strategy where customers are required to pay $119 for a year of Prime membership. Instead of having customers who buys products from Amazon 3-4 times an year, Amazon has converted most of its existing customers into Prime members where they pay Amazon $119 an year (fixed). Although Amazon is a big brand but still you can adopt this super useful strategy to improve your customer base.
- Consider raising the prices of your products or services because people take you seriously if they spend more. Don’t be afraid to raise your prices because you are a small business. Take some risk and see the impact it can have on your business profits.
- If you are still working with old equipments and inventory then consider upgrading them or replacing them. This can have a direct impact on your sales and productivity.
- Offer special discounts to long term customers and renew their annual contracts.
- Start charging for late payments and offer incentives for early payments.
3- Directly Reach Your Customers Where They Are Present At The Moment
As a business owner, you should not leave any opportunity to reach your potential customers. It is always a better idea to sell your products or services directly where your customers are present. This can be done with the help of POS. A POS system like Shopify gives you the ability to accept credit cards on the go. This means you can sell your products and accept payments on any device from anywhere. Isn’t this great?
In order to promote your business and reach new customers, you can try the below strategies which will make it easier for you to sell products by directly reaching the customers where they are present at the moment:
- Participate in trade shows and seminars. This will give you the opportunity to reach genuine new prospects who might be interested in your services. No need to say that you can complete a sale super easily with the help of POS.
- Organize a workshop for your potential customers and educate them about the value of your products. Remember, it must solve the current problems faced by the people. This will give you a chance to improve branding and reach new customers.
- Open a mini store outlet in a shopping mall. This will give you ample opportunity to get new customers on a regular basis.
4- Master Social Media Marketing
Millenials love to spend time on social media and businesses need to impress millenials in order to grow their business. Hence, one of the most trusted strategies for any small business owner is to master the skills of social media marketing because this is where you can reach people who can be loyal to your business. Here are some time-tested strategies that you must use to improve your social media skills and raise more profits:
- Stay away from promoting your products or services on social media. Millennials hate them! Instead, share articles and videos that helps to solve the problems of your prospects. When you start delivering the value, people will start to follow you, once they follow you, they will end up becoming your customers.
- Get personal and ask your existing customers to share their stories and insights related to your niche.
- Respond to people and stop ignoring the negative comments.
- Make use of tools such as Hootsuite to schedule regular posts related to brand storytelling or awesome deals.
- Leverage the selling power of a hashtag to increase the presence of your business and to generate more sales.
- If you are selling products then consider creating a store on Facebook. You can easily create a store using the FB store app.
- Generate more reviews for your small business using a platform like Yotpo. You can even create shoppable galleries on your social channels where you can showcase your best customer content.
Remember that today’s consumer is over burdened by marketing and they are looking for solutions to their problems. Your business must offer the solutions to them instead of forcefully selling the products. If you consider this approach of problem solving, you will never go wrong. Hence, follow the strategies discussed in this article and improve your small business ROI.