Building a business is hard work. But sustaining growth and profitability require more than just effort. They take innovation, commitment and the right focus. So if you are frustrated with where your business is today and ready to improve your business, here are five suggestions to help you get started.
#1 – Have an Open Mind
Ideas and opinions come from a variety of sources. Some ideas are obvious opportunities. Others come from fleeting remarks by friends, colleagues, employees or even total strangers.
Today, more than ever, people dismiss ideas because they don’t like the source or messenger. Sad because good ideas can come from anywhere — if we open our minds to the possibilities. With an open mind and a willingness to try new things, ideas will flow and improvements will follow.
#2 – Invest In Your People
If you want to improve your business — start with your most valuable asset. Your team. It’s hard to be a great company without great people.
When you have a great team, innovation and creativity seem to flow. There is no need to force them to work together. Collaboration is something that happens because they value each others opinions. When you create an environment where people are engaged and productive, good things happen. It pays dividends.
Investing in your team make sense. The work place is changing so now is a good time to look at your culture, your hiring, your benefits, your training and most of all — your expectations. You can’t change things overnight, but over time you can. Just make it a priority.
#3 – Be a Profit Builder
Keep your focus on the bottom line. You can’t stay in business if you don’t make a profit. If you want to take care of your customers and your employees, profit is not an option — it’s a requirement.
There are a lot of ways to improve profit in your business. Cutting costs in an obvious one. But while keeping costs down is important, put adequate resources into other areas too. Here’s a few you may wish to consider:
- Focus on growing sales of higher margin products and services. Products, like customers are not created equal. The growth of low-margin products can actually reduce your overall profit.
- Gain efficiency and save time with systems and technology. It’s especially important for service businesses that are labor dependent.
- Eliminate re-works that come from poor quality. Get it right the first time.
- Evaluate your pricing to reflect value, not just cost. This can help you optimize the gross profit margins, a key profit driver.
- Improve your marketing ROI with better targeting, compelling messages, diverse tactics and a follow-up system that converts more leads.
#4 – Balance Operations and Business Development
As a business grows, the day-to-day running and serving customers can become overwhelming. When this occurs, marketing and sales activities often go on the back burner, Building a pipeline of new business opportunities while increasing sales to existing customers takes time. It is not a stop-start activity. Plan and make business development activities something that is done daily, weekly and monthly. Whether you delegate or outsource these tasks, do it consistently. It will pay off on the bottom line.
#5 – Think Lifetime Value
As a business owner, you must establish a long-term view of customer value before you can appreciate how important it is to develop a relationship with customers and ensure everything is done to keep them as long as possible. What are your customers worth over their lifetime?
Here’s an example to demonstrate this point. You own a lawn-care company. The customer pays you $50 each time you mow their lawn. While the first transaction is only $50, they spend that each week from May – September, so annually they spend about $1,000. If they stay with you for four years, they will spend about $4,000. So is this a $50 customer or a $4,000 customer? The way you view them will dictate how you invest in current and future customers.
About Joan Nowak. As a business improvement expert, business coach, and consultant, I’ve been helping entrepreneurs turn ideas into profits for more than a decade. My whole-business approach empowers clients and drives improvements in key areas including revenue, operational performance, team development, customer satisfaction, and profitability.
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