Home
>
Small Business
>
Five Break-through Ideas to Immediately Increase Profits and Improve Cash Flow

Five Break-through Ideas to Immediately Increase Profits and Improve Cash Flow

Too often in business we get trapped into reviewing our sales numbers without analyzing the all important "profit" number. This is commonly referred to as the "bottom-line" of a business. There are various ways you can dramatically impact your profitability.

1) Under Pricing Kills Profits!

Many small businesses have thinner profit margins than larger firms do because they tend to under price their products or services. So why not just raise prices? I know the feeling--you're scared that your competition might swoop in like a bird of prey and your customer base might shrivel overnight!

If you have thought about raising prices but haven't done so, let me give you an example that may give you the confidence to do so. My client, Steve Lopes of Stanley Steemer based out of Edison, NJ had a positive experience from raising prices about a year back. After giving me much resistance to my advice to raise prices, Steve agreed it would be prudent to test it. The result? Sales and profit went up for the month in which he raised prices and Steve was pleasantly surprised at the little, if any resistance he got from his customers.

Since then, Steve has increased prices 2 more times. What happened to sales and net profits? Sales surged by 25% for that 12-month period and net profits for that same period skyrocketed by 84%. Since Steve's sales are in the 7 digits, these sales and net profit increases equate to very significant numbers. Best of all, it allows Steve with a lot of extra cash to do things he wanted to do in his business and personally.

Still unsure about raising prices? Remember, you can always cut them back. More likely then not, you'll be surprised at the positive impact it'll have on your business, assuming of course you continue to provide the same or better level of service to your customers.

2) Is The Marketing Working?

Make your advertising accountable.

You've probably heard the familiar maxim: "Twenty percent of my advertising brings in 80 percent of my business, but I don't know which 20 percent!" I see that as a common problem with many small-businesses. They don't track their marketing to know what's working, what's not. This problem stems from a bigger problem and that is not being aware of the difference between institutional and direct-response advertising.

Institutional advertising, also known as image advertising, is all about you, the business owner. How great you are, your qualifications, years in business, "full-service" product line, etc. It's the most common form of advertising. You see institutional ads every day in print or in TV. They're often cute, creative, funny, utterly ineffective and not trackable. Simply put, an institutional ad has no way to track results and is there to keep the company name in front of the public.

By contrast, direct response advertising is all about your customer and his or her needs. Its purpose is to stimulate a phone call, letter or a visit. Best of all, unlike an institutional ad, it is trackable so you can make every dollar you spend on it accountable. This then helps to measure the effectiveness of each ad.

3) The Easiest Way To Profits

Keep a lid on spending! Resist the urge to spend freely. You may like the way a lavish office and expensive furniture looks, but does it really contribute to your business? In some businesses, a fancy office is critical; in most it is not. I once had a small business owner who spent $5,000 on his front office desk in a business operation that had no "office visits." Needless, to say, this business owner did not survive too long in business due to this and other extravagances. Get as much value out of every transaction, whether you're leasing office space or stocking the kitchen.

Important caveat: Don't compromise when it comes to spending money on your own self-development. Small business owners don't give this enough importance and thus spend far too little money in this area. This is a big mistake. As an example, in the next 5 weeks, I'll be attending three conferences across the country and investing about $4,300 in seminar tuition fees, travel and boarding. Not a small chunk of change you would agree, but in my opinion, well worth the investment. You are the most important asset in your business. Take good care of you.

4) Have You Got A Back End For Every Sale?

Most small-businesses ignore the easy money to be made with a back-end sale. Yet, the really smart business owner never forgets that the most profitable words in the history of business were: "Would you like fries with that?" I have read that these words instantly doubled the total sale.

Your biggest expense is reaching a new customer. If you succeed to winning him over to the point that he pulls out his wallet and gives you money. . . he will often continue to give you money if you offer something else. Yet, you do not need any expensive advertising to do this ? he's already listening to you. You simply have to open your mouth and offer him something else.

Savvy small-business owners will have something more expensive to sell, and something less expensive. Something else that fits in with whatever the initial sale was. . . and something else that just has broad appeal. But they will always have something on the back-end.

5) Outsource Judiciously

One of the battle cries in business today is to determine the one thing that your business does best, become even better at it, and outsource absolutely everything else. There is certainly a lot to be said for taking a careful look at every function in your business and asking yourself if you should outsource it. But take a hard look at the numbers before you decide to jump on the outsource bandwagon!

Salim Omar, CPA is the author of the newly published book, Straight Talk About Small Business Success In New Jersey now available in Barnes and Noble bookstores and on amazon.com.

More free information can be accessed on his website amazon.com

professional maid services Glencoe ..

In The News:

SessionReaper vulnerability hits Magento and Adobe Commerce stores, compromising 250+ sites in one day. Hackers steal data and hijack shopping sessions.

Master essential parental controls and digital safety tools to protect your kids online. Learn screen time limits, location settings and privacy controls every parent needs.

Cybersecurity expert shares six essential steps to protect against dark web threats, including data removal services, password managers and antivirus software.

NVIDIA GPU space mission could revolutionize cloud services by enabling orbital data centers that make apps, games and AI tools faster and more efficient.

Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents now and for the future.

Microsoft warns Windows 10 users face serious security risks as 90% of ransomware attacks target unsupported systems. Learn why upgrading to Windows 11 is crucial.

Nike unveils Project Amplify, revolutionary motorized shoes developed with Dephy that add powered assistance to every step for runners and walkers.

Cybersecurity experts warn about one of the largest credential compilations ever found, urging users to check "Have I Been Pwned" and change passwords immediately.

Quick iPhone and Android battery optimization techniques help your device stay powered all day by turning off hidden features that secretly drain power in the background.

Kodiak Driver autonomous truck achieves perfect 98 safety score, matching top human fleets in groundbreaking AI evaluation by Nauto's VERA system.

New 401k catch-up contribution rules in 2026 will change taxes for high earners over 50. Learn how scammers exploit these changes and protect your retirement savings.

Kurt Knutsson's guide covers social media privacy protection through location settings, account privacy controls and two-factor authentication to prevent scams and data breaches.

Revolutionary retinal implant restores central vision in 80% of patients with advanced macular degeneration, offering hope where treatments once only slowed blindness.

Learn how to use passkeys on Windows and Mac computers without cameras or fingerprint readers. Discover secure authentication methods that replace passwords.

Tesla's FSD v14.1.2 update reintroduces Mad Max mode, enabling higher speeds and more frequent lane changes than the standard Hurry profile setting.

A phishing email scam targeting American Express customers shows how cybercriminals use fake urgent messages to steal personal and financial information.

Facebook's new Meta AI feature analyzes your camera roll photos to create polished collages automatically, but requires cloud processing and raises privacy concerns.

A New Jersey teenager filed a major lawsuit against AI/Robotics Venture Strategy 3 Ltd. over ClothOff, an AI tool that created fake nude images from her social media photos.

Microsoft reports Storm-2657 cybercriminals sent phishing emails to 6,000 addresses at 25 universities to steal payroll credentials and redirect funds.

Astronomers have discovered asteroid 2025 SC79, a skyscraper-sized space rock orbiting the sun in just 128 days. the second-fastest known.

The Fox News AI Newsletter delivers the latest developments form the world of artificial intelligence, including the technology's challenges and opportunities.

A cyberattack on SimonMed Imaging exposed personal information of 1.2 million patients, including medical records, financial details and identity papers.

Spotify's managed accounts for kids under 13 now available in at least seven countries, allowing parents to filter and block explicit content and songs.

Friendly text conversations about BBQs and social events can lead to WEEX gold trading scams that target older adults with fake investment opportunities.

California company Skyeports creates self-healing glass spheres from Moon regolith that generate solar power and support plant growth for sustainable lunar living.