The reason why we are doing business is to gain profit. Speaking of profit, it must be a “clean” profit. What that means is that the customers must get what they’ve paid for, so they can feel every cent they spent money on a particular product is worth it.
Some other companies however, have been doing dirty tricks to fool customers. Using unclean ways which enables them to gain big profits while cutting costs at the same time. Which is by taking away the original quality of a product.
This is not the right way on how to become profitable, this will only damage your brand and also its reputation. To help you maximize profit into your business, here are 5 tips for you to follow.
Remove activities that doesn’t have any value to the customer/company
- To help you with this, list all the activities that are performed on a normal day in your business. After that, take time to analyze each activities and see if it values to the customer, company, or both. If you happen to find an activity that doesn’t value both parties, consider removing them to save time and money which will lead to more profit.
Increase the price by 2%
- Consumers understand why a company or business has to increase their price occasionally. But be sure to raise it only a little bit more, not drastically increasing it which will make your product expensive. This will result to your product not able to compete well in the market. Raising the price by 2% will do.
Know your return on investment with each resource
- If you’re planning to contract a person, or purchase machinery or combine it with a piece of software, you should definitely check the Return On Investment (ROI) before doing such. Maybe you need it or maybe not. It’s better to do a trial run first and see if it actually benefits your business. If it’s not, then scrap it. There’s no point in investing something that won’t do any profit in return.
- Cross selling and up selling must be included in your business to gain more profit. But be sure to do it right and don’t scam your customers. For example, if you’re a barber on a barber shop you can offer your customer a clean wash and blow dry for only $2, this is called up selling. And when everything is finished and your customer is ready to pay, offer him the best-selling shampoo and conditioner which is only 5% off for every purchase of haircut, this is called cross selling. Implementing this kind of technique can definitely make your profits soar high.
Implement a customer loyalty program
- Having a customer loyalty program not only just increase your profits, but you can also gain more customers too. For example, you have a product that has a buy 5 and get 1 free deal. This will make customers to come back again and again which leads to more profit.