Money is the most important factor to consider if you are into business. After all, you constantly keep on re-evaluating your strategies to ultimately maximize your profit and stand out from other competitors in the market.
Going by the conventional advice, diversifying your business is considered a good option but the important errand is to not lose your profits in diversifying your existing well-established business.
If you are determined to make more money from your business, cutting off costs is important. But ask yourself, ‘Are you spending all your energy in minimizing your costs?’
Because remember that there is a limit to how much you can save but there is no limit to how much you can earn.
Here are some revolutionary ways by which you can think out of the box and make even more money for your business:
Sell services on a project basis, instead of hourly
One of the initial steps that you can take to start earning more is to stop charging your customers on an hourly basis. In case you primarily sell services, pack your services as products.
Billing by the hour undermines your ability to be acquired along with having many negative effects, especially when you are trying to grow your business. Instead of being a company hawking hours, you can start packing your services differently.
An alternative to this is to pick up a few things that your business is good at and come up with a mutual understanding with the customer for a standard pricing delivery of your product and services.
This means that instead of charging on an hourly basis, charge a flat rate per project. This practice is bound to bring you more money and form the basis of a trustworthy customer relationship.
The endowment effect
The key to earning more than your competitors is to hold your customers tight. Shift your sales focus to your existing customers rather than your potential customers.
According to a market survey, top 20 percent of your loyal customers are responsible for 80 percent of your company’s revenue.
However, your customers will not spend a huge amount of money in your products, all at once. Instead, they will give it a try by buying your lowest available package. It is good enough for a start. But then, what next?
Once they are done exploring the basic package, it becomes your job to compel them to buy more. This should be your next goal. You might ask why?
Image source: Kissmetrics
As the customer invests more in your product or services, they are actually making it more valuable to them. This would rather induce a chain reaction and compel them to buy even more. In other words, the customer will find it hard to leave your product or service.
This is known as the endowment effect. It works on the principle that people value something more if they invest in it. So, the more your customers invest and the longer they stay, the more likely they are to keep on investing more.
Accessorize your products
You might not earn as much money by selling one product, as you can earn by selling the entire closet to the customer. Add more value added services and goods that compel the customers to spend even more in your brand.
Customers don’t usually stop at once. If you give them more attractive options, there is a strong tendency that they will buy more.
As a service provider in IT industries, follow one platform multiple services structures to attract more people. They will see the benefit of dealing with one vendor for multiple services which makes their task easy and managed.
On Sarv.com we follow this structure of “One Platform Multiple Services” and this structure helped us earn more and more customers.
Consider that you are a seller of kitchen accessories. You can sell recipes or cooking tips complementary to your products. Understand what kind of product you are selling, and then explore all options that the customer might be interested in.
Ask yourself, ‘What are you offering to add more value to each sale?’ If you are a mechanical tool seller, sell a handbook of designs along with it.
If you are an online garment seller, offer an attractive pair of shoes to go with the customer’s choice of dress. It is bound to bring you more money. Ajio’s Shop the story fits as a perfect example.
Image source: Ajio.com
Cut down your costs
Cutting down your expenses will earn you more profits. Once in a while review your selling expenditure. This includes your infrastructure expenditure, reviewing your regular vendors, monitoring your employees, technology expenditure etc.
Take a good look at all your vendors and review your agreement with them. Over time, it is good to explore more options as some vendors might be offering cheap services than others.
Also, consider your technology expenditures. They are the ones that cost you the most. Review and keep updating your technology, while discarding the old.
If you have tangible assets, keep an eye on them as well. Audit your employees to check if they are still wanted on a particular level. Your intellectual property, your customers, your services and your employees are all your assets.
Thus, it becomes essential to make sure none of your assets are being underutilized.
Image source: cleartosearch.com
Team up
I am not asking you to find a business partner for yourself. But as your business grows, you must team with someone from another sector that will help you boost up your sales. For example, an insurance agent can team up with a financial planner.
Once your business starts growing you get busy doing all the work yourself as a leader of your business. In cases like these, team up or hire appropriate people who can take care of your petty tasks so that you focus on formulating a bigger strategy. Focus on those tasks that bring revenue to you.
So, if you want to make more money from your business you need motivation, skills and a tinge of luck. Combine the process of earning more with saving, investment, and spending. Take classes if you have to, in order to enhance your skills and then aggressively market your products.
It is best considered to stay up to date with technology by automating things rather than doing them in an old fashioned way. Take calculated risks to climb the ladder of success while earning more on each step.
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