Brad Sugars' Blog|Franchising|Small Business Coaching|business advice|business help|business mentor|executive coach|

Are you looking to make more money in your business?

Well, I have good news for you.

Here’s five simple strategies to boost your profit margins … today!

1) Increase your prices. This is the fastest and easiest way to boost your margins, and I’ve found that business owners tend to be more afraid of raising prices than their customers are.

I’ve also noticed most customers won’t notice the increase and the ones who complain about it probably already complain about something else.

Start with at least 10%, and the chances are you’ll see the benefits of your increase faster than your customers notice the difference.

Now, you don’t want to draw attention to the increases, but if customers ask, explain the reasons and then focus on the benefits of your products or services.

2) Stop Discounting. If you constantly discount, why have a regular price? Remember, you never want to be thought of as a discount business.

Discounting costs you money and gives the impression that your usual prices are a rip-off.

Customers may not buy from you today because they think an item might go on sale tomorrow.

Instead of discounting, focus on the value and benefits you provide and offer as much add on value as much as possible.

3) Know your Actual Costs. In many businesses, expenses are never truly evaluated. If you know what your actual costs are, you can find ways to reduce them.

Sit down and spend a few days checking everything about your business.

As you go forward, take what you’ve learned in your evaluation and seek numerous quotes when purchasing anything of an ongoing nature.

4) View Costs as a Percentage of Sales. This gives you an idea of how many sales you need to make before you start showing profit.

How much does it cost to keep your doors open every week?

What time of the day or week or month does your business become profitable?

Once you view your costs as a percentage of sales, then you can figure out how many sales are needed to cover that cost.

To get the most out of this, you’ll need to communicate the information to your team, since they need to know what your business needs to stay open.

Put a big whiteboard up in your business with a countdown to break-even and profit. You will be surprised how much your team will respond to this.

Having a reward system that kicks in after you reach your break- even point is a great way to keep your team motivated and understand what you need to make your business grow.

5) Decrease Your Range. The greater the range of products, the more suppliers you have, the more shelf space you need, the more money you have invested in stock, the more costs you have.

It’s a never ending cycle for some businesses …

Eliminating slow moving stock or bundling is a great way to make more money per item sold.

You should be able to negotiate better deals with suppliers if you are buying fast moving items from them, which can lead to better deals for your customers.

Remember to monitor the movements of every item you sell and invest more in stock that moves quickly.

By following these simple steps, you can boost your profit margins and increase your overall profitability.