Your Business Profitability by Marie Gibson
The Ten Steps to your Business Profitability listed below offer a brief summary that is intended to encourage you to ask more; to seek out assistance; and to challenge yourself to work towards your business goal of profitability during the next year. However, the bottom line doesn’t just happen. A profit doesn’t magically appear. You must integrate all of the major areas of your business for maximum financial results. Each of these areas is worthy of in-depth discussions and I encourage you to find an appropriate mentor or consultant.
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Define Your Niche – You must be very clear who your business is serving and you must develop a profile of your perfect client/customer. It’s important to have very specific products and services that you offer to a precise niche — usually an underserved market. Know what is unique about your service/product and itemize the benefits of that product or service. Be able to articulate the message of your unique talents and expertise in your marketing efforts.
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Select an appropriate business model – one that will provide for income and growth potential. Create multiple income streams, offers, and products that will both earn money and will produce income on a regular, predictable pattern. Some business models are fun and exciting — but aren’t profitable. Others require huge investments and a long period of growth to achieve profitability. Learn to choose your business model wisely.
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Set clear, definite goals with your business – Create specific achievable goals that will stretch your ability as a business owner. Write your goals on paper and find someone, such as a coach or mentor, to hold you accountable for them. Ask yourself, “What do I want my business to look like one month from now, one year from now and even five years from now?” Clear expectations will help you build the momentum for moving forward quickly.
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Create a business plan with a budget so that you know where you’re going and how you’re going to get there. Include feasibility forecasting so that you detail where your income is being earned, and when and what sales it takes to achieve it.
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Create a marketing action plan – Know what your brand is, how you will market it, the specific customers that you will market to, and when you must start each section of the plan. Each section/service/product in the plan must lead to the next section in the plan. This is no longer a mishmash of products/services that you sell whenever the mood strikes. Your marketing plan and schedule is carefully thought-out and scheduled. This will take some experience and initially you may only be able to plan for one to two months. As your business grows, you’ll be able to expand your marketing strategy and scheduling over one to two years.
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Set up your internal systems – Make sure that your accounting system and policies and procedures are set up to standardize your systems. If you have employees, make sure you give them a handbook that clearly states their rights and responsibilities. Offer great customer service while solving issues for your client. Learn to use your accounting reports to provide you with useful information to make wise business decisions. If you allow payment terms for your clients, make sure that you keep your Accounts Receivable current.
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Manage your time wisely – A wise time manager learns productivity skills and refrains from wasting time on non-productive activities. Learn to be careful of the amount of time you spend AND the quality of time you spend on emails, phone calls, meetings and other disruptions.
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Increase your credibility – You’ll want to start meeting people at networking mixers, donating articles and blog submissions online, speaking publicly and serving as a volunteer in your local community. Become the local expert in your field and offer to write newspaper articles. Speak up to be recognized.
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Data base expansion of your contacts. In business, it’s imperative to have an active and up-to date data base of customers and potential customers, who admire you, buy your services and products and who promote you to their friends and colleagues. Use an automatic system that allows people to opt-in and opt-out for greater convenience. Remember, 20% of your clients will make 80% of your purchases. You don’t want a data base full of names that never order. You’d prefer fewer, high quality clients and customers that purchase from you regularly. It’s easier to sell to existing clients than it is to find new clients.
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Charge what you are worth – Most small business owners undercharge for their services and products. Using a discounted pricing strategy won’t let you compete with the big box discount stores and service providers — they’ll always be able to provide something cheaper. It’s better to find an exclusive niche that they don’t provide and then charge what the market will bear. Keep raising your prices until you meet significant resistance. Manage your margins and quit giving your services and products away for free.
OK…I couldn’t keep it to ten!
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Model the correct people – Find people who are successful and whom you respect. Hire a mentor, consultant, or a coach to lead you through the difficulties of running a business. This person should galvanize you to action and ask you to be accountable for your goals — whether they are personal or business. A good mentor will share with you ways to improve your business without looking down on you or overwhelming you with too much at one time. She will help you find your own path and walk down the path confidently to find your own success!
Oh…and one last tip . . . Obtain feedback from your records, your clients and your team members on a regularly basis. Refine your niche and goals and begin again. Repeat for maximum success.
© Marie Gibson is devoted to helping business owners make wise business decisions by taking charge of their accounting and running their business profitably! For more information and to register for her free weekly guide: www.marie-gibson.com
The information presented in this article is for informational purposes only and should not take the place of professional financial and/or legal consultation.
Sometimes when you have money issues you have money clutter. If you have money clutter you may have clutter in other areas of your life. To help you may be interested in the Get a Plan! Guide® to De-clutter & De-stress: A Dozen Ways to Decrease Your Clutter and Decrease Your Stress. This Get a Plan! Guide® will help you learn a dozen specific ways to start dealing deliberately with your clutter – and then experiencing a reduction in your stress.
