In the business world, there are two low-level ways of increasing a company’s profit: sell more or spend less!
Most of the time, companies opt to cut costs as it is a far easier exercise to accomplish than to increase sales (although I should point out that it is still important that you make attempts to increase your sales, otherwise you won’t have much of a business to run)!
If you have been running your business for a while and are finding that you just aren’t making enough profit, then you should be addressing this situation sooner rather than later. Here are some ideas to help you make your firm a more profitable one.
Review your supply chain processes
The first area you should be looking at within your business is your supply chain processes. I am specifically talking about the companies you use to purchase goods and services from.
It is an unfortunate and sad fact that many businesses and organisations waste a lot of money by simply sticking to the same suppliers out of loyalty, when, in fact, they could receive the same amount of good customer service but pay much less by going elsewhere.
When it comes to utility bills like gas, electricity and water, as well as telephone and broadband providers, you should be comparing deals from various suppliers just as you would at home, so that you can be sure that you are getting the best value for money.
Automate common tasks
One thing that can save your company money (and time) is to automate certain tasks that are usually performed manually by employees. This will result in efficiency being improved, and your employees can be deployed to other areas of the business where their skills can be better utilised for increased productivity.
For example, if your company employs someone to write addresses on envelopes, insert letters and stick postage stamps on the envelopes, then you could automate that process by investing in equipment to automate those processes in-house, or you could outsource that work to a third party to do it all for you.
Save money on energy costs
At home, we often look for ways of cutting down on our energy bills, and the same should apply for businesses too.
For example, energy-saving light bulbs are far more efficient and longer-lasting than incandescent bulbs, energy-saving computer systems will only use the most CPU power (and electricity) when needed, and well-insulated offices can help businesses to save money on heating bills during the colder months of the year.
Empower your senior management and directors
Although many senior managers and directors might have excellent business acumen, you will often find that they cannot overcome some personal obstacles in order to lead the company forward and drive it towards a point where it can make the most amount of profit.
This is where business coaches such as ActionCOACH step in. They will be able to work with those senior managers and directors, find out what it is that is causing those obstacles and empower them to overcoming them.