How to Increase Profits in Your Business

1. Cut overhead by automating almost everything.

Accounting, reporting, voice mail, ordering, fulfillment, customer service, sales.

2. Cut variable expenses by negotiating with suppliers.

If you're seeking higher profits, you'll need your suppliers to reinvent themselves too! The smart suppliers will be empowered by your request.

3. Cut variable expenses by redesigning (re-engineering) how work gets

done/how the product is produced. This should be a continual process and second nature to you.

4. Increase productivity by expecting 50%-100% more from everyone. (Yes,

really. THAT much more.) And give them the best tools and training needed to produce more, without stress.

5. Leverage your strengths by extending the product/service line.

If you can easily add supplemental products or customized versions at the same profit margin, your overall profit should increase.

6. Each quarter, challenge your assumptions about your industry and your

company. Profit is ALWAYS temporary. What keeps profits increasing long term is staying in touch with an always-changing marketplace/industry.

7. Experiment with new ideas, new types of products and new processes.

Invest 1% of sales into making boo-boos, radical experiments, intuitively-based decisions, think tank getaways -- whatever is beyond the 9 dots.

8. Have and hire only employees who continually impress you with their

initiative and competence. Let everyone else go. Increasing profits come from great employees, not average ones.

9. Turn your customer service department into the R&D Department of your

company.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

What you need to consider when dealing with customers

Following are the top ten things any business needs to consider when designing policies and procedures to deal with customers.

1. Customers are not transactions!

While transactions are important, when we confuse transactions and customers we lose the leverage of the customer relationship.

2. Build relationships INTO your policies & procedures!

When we design an organization, we need to consider how our policies and procedures will ALLOW our employees to build customer relationships.

3. Transaction density is just as important as transaction intensity!

The more we can "do" for our customers, the greater number of products and services they purchase from our organization. If we increase the number of options for them each time they purchase or use our services, the likelihood remains that they will purchase or use our services in greater depth each time they purchase.

4. What is our "share of life?"

Throughout the lifetime of our customers, we will have the opportunity to share our products and services with them. To the extent this sharing is beneficial to both parties will indicate the level of share we have the opportunity to gain. Over the course of this sharing, our products will gain a percentage of total sales in that category of our customer's purchasing life. This is our "share of life."

5. Building relationships and margin through attitude!

Indirect benefits of handling your customers as if their total purchasing lifetime matters is the ATTITUDE of your enterprise. Even if customers never return or purchase another thing, they remember and pass on to others that attitude.

6. Margin increases over a lifetime!

Studies have shown that over a lifetime of a customer relationship, that profits increase due to lower costs of acquisition and maintenance in the relationship.

7. Customer loyalty results from relationships!

Word of mouth advertising constitutes roughly 55% of your total impressions that bring customers to your business. As customer loyalty increases along with lifetime value and share of life, the ability of your enterprise to attract and maintain its customer base increases customer loyalty.

8. "Lifetime value systems" increase barriers to switching!

The greater the relationship that exists between your business and your customers, the more your customers are invested in your business. This investment increases the "switching cost" of your customers to move to another brand. Due to the simple attitude your business develops regarding "customer lifetime value," your customers are "encouraged and attracted" to doing even more business with you because it is easier than training a new business to serve them as well.

9. Lifetime value systems create leverage for employees!

When your employees understand the concept of customer lifetime value, they find it much easier to deal with problems associated with customer relationships. Instead of dealing with the moment they deal with the moment in the context of the lifetime value relationship!

10. Customer Lifetime Value means "money for nothing!"

The sheer force of a customer relationship produces benefits to the business through increased margin and benefits to the customer through innovative ways to meet needs. This perspective is win-win and offers momentum to the relationship that creates opportunity for everyone involved!