Most business owners are looking for ways to increase their profits. You can either increase your prices or reduce costs. What are the most cost-effective and affordable options, especially during COVID-19? These 14 strategies will help you and your company make more money in 2021.
- 0.1 1. 1.
- 0.2 2. Automate Business Systems
- 0.3 3. 3. Improve Your Website
- 0.4 4. 4.
- 0.5 5. Communicate with Customers
- 0.6 6. 6.
- 0.7 7. 7.
- 0.8 8. Advertise More
- 0.9 9. Raise Prices
- 0.10 10. 10.
- 0.11 11. Reduce the price of a leader item
- 0.12 12. Follow the 80/20 Rule
- 0.13 13. Reduce Costs
- 0.14 14. Collaborate
- 1 Bottom line
Online sales increased significantly after the pandemic shut downs. Even after the pandemic, online sales will continue to grow. This is the perfect time to expand or move into online shopping.
To implement ecommerce, the first step is to make your website accept online orders. You will need an platform that allows you to accept online payments. These platforms can be added to your existing website. You can also add them to a separate site like Square.
Square is a payment processor that also provides a well-design ecommerce website for free.
Online sales are more than just accepting orders online. You will also need to offer curbside pickup or mailing delivery. You can also accept payments remotely.
You might also consider a delivery company and part-time driver job. This is particularly important for restaurants who need to offer online ordering.
2. Automate Business Systems
Automating processes is one way to increase efficiency and decrease costs. Software services or software that is good can automate everything, from inventory to payroll. This will allow you and your employees to focus on the tasks that are most important to your business.
You might consider automating these business systems:
- Lead generation
- Appointment scheduling
- Employee scheduling
- Employee benefits
- Background checks
- Payroll Processing
3. 3. Improve Your Website
Your website is being used by people to research your company and make business decisions. How can you make their experience better and increase their trust in your company so that they are more likely use your product/service? Your website should accomplish four things clearly
- Describe who you are and the products you offer
- Attract potential customers to purchase
- Facilitate the purchase of your product or service
- You can easily contact customer service or sales to ask questions
Start by making sure your website is clean, current, up-to-date, and updated in terms of its information. Next, test your ecommerce components to ensure they work smoothly.
The free SEO Analyzer tool on NeilPatel.com will give you strategies that help get your website found on Google.
After you have set up your website, perform a search engine optimization audit (SEO). An SEO audit will allow you to better understand how Google and other search engines view your website. SEO-based modifications may be required to improve the visibility of your website when someone searches for what it provides.
Review your customer communication experience, in addition to SEO.
- Are there any links to social media sites?
- Do you have a section or a link where customers can leave reviews?
- A chatbot could benefit your site by answering common questions
- Is your email and phone number easily reachable?
Customers can leave reviews on your free Google My Business listing.
Responding to customer reviews is a simple way to increase sales and conversions. Consumers say that businesses that respond to customer reviews are 1.7X more trustworthy than those who don’t (76% to 46%).
Pay attention to these reviews and respond to any negative comments. Some 45% consumers say that they are more likely to visit businesses that respond to negative reviews. You can also share positive reviews on your site and social media. Spread the word!
Encourage reviews by making it easy. Have you ever received a receipt promising to send you something free for filling in a review? You can increase your chances of getting customers to write reviews by sending them an email and a hyperlink.
5. Communicate with Customers
Customers expect to have a relationship with companies they patronize. Interactions can provide valuable insight for businesses about customers.
Communication is a two-way process. Don’t just ask for feedback. You can also offer advice or discounts in exchange for feedback. There are many ways to communicate with customers and establish a relationship. Here are some:
- You can also go in-person and take a bit more time at the counter
- Email – A thank you, feedback and coupons
- By signing up for our newsletters
- Social media:
- Chat rooms for your website
- Virtual Meet-ups offer an opportunity to meet interesting speakers
You might be reluctant to invest more money in your business at first. This is especially true when you are trying to figure how to make more money and not less. In times of chaos, where there are new opportunities, it is often the best decision to take a short-term risk for a long-term reward.
Get creative when looking for a large investment in your company. You don’t need to use your business or personal funds for this investment. Customers will benefit from this upgrade? Think about a crowdfunding campaign. Do you need better equipment? You might consider a equipment loan. Do you see it as a new idea? Consider getting an investor.
Freelance websites like Upwork.com help you connect with vetted freelancers.
Outsourcing tasks or hiring contractors is one way to reduce costs. This allows you to save on employee benefits such as FICA or health insurance. It also gives you more money for your bottom-line. An expert contractor may be able to do a job faster and better than adding it on to an employee with less qualifications.
Outsourcing and contractors are particularly useful for administrative tasks, short-term projects, and other unique tasks that do not require a full-time employee. You may find certain services such as HR or accounting included in a software and/or service package. You might consider a freelancer site if you are looking for contractors to do a particular task.
8. Advertise More
Advertising can be a costly investment. Perhaps you have been scammed by marketers who promised results but didn’t deliver. You might have tried advertising on your own, such as Facebook ads, but it didn’t work.
Advertising works, regardless of past experience. However, it is a long-term strategy. Experts believe that a customer must view an advertisement 20 times before taking action. A Facebook advertisement to 10,000 people will not be as effective than 10 ads to 1000 people.
You can make advertising more powerful by reading Influence by Robert Cialdini. This book provides strategies to convince people to act on your ads quickly.
9. Raise Prices
This strategy is both simple and unpopular in today’s economic climate. However, it is sometimes necessary to raise prices in order to remain in business. Consider these options when settling on a price:
- What does it cost to make the product?
- What it costs to deliver it
- The business costs, including administration and wages,
- Prices of competitors
- Last time you increased prices
Consider the data and decide on a fair price increase. You can include any pricing data in your Business Plan if you wish to revisit it later.
Next, tell customers about the increase. Explain the reasons you made this decision. Customers should be informed that there are ways to increase the value of the product without reducing profits.
Keep in mind that increasing prices can result not in a decrease but an increase in sales according to Influence, the best-selling book on persuasion. This psychological effect is caused by people seeing your product or service more valuable because it costs more.
Selling to existing customers is easier and more cost-effective than selling to new ones. Offer additional products and add-ons to existing customers or leads.
via your email list is one of the best ways to accomplish this. Perhaps you aren’t interested in sending another email to customers. You may be thinking wrongly about customer emails if this is the case.
Customers should value their emails more than sales. What can you offer your customers to add value to their lives? Think of a tip, recommendation or piece of advice that is relevant to your industry. Next, add the sales language to the value.
You can also sell to existing customers. Send handwritten notes to your loyal customers. Include a coupon or a reminder that you value them as customers in the note. Include a call to action (CTA) at the end.
11. Reduce the price of a leader item
A leader item is a product that your customer buys. This could be a basic product, a subscription that offers no frills, or the first of a series.
You can attract new customers by offering the leader item at an unassailable price. Once they become a customer, it is possible to sell additional products, upsell (more of your current item), and cross-sell (a new item). No matter what strategy you use, the key is to offer a customer a great deal on the leader product.
12. Follow the 80/20 Rule
You should focus your efforts on your most valuable customers. It is believed that 20% of your customers bring in 80% of your revenue. These are the customers you should be focusing on.
The flip side is that 20% of your customers are often the source of 80% of your problems. To make your business more productive, identify and fire problem customers.
13. Reduce Costs
The Profit Leverage Effect (PLE) is one way to reduce costs. The Profit Leverage Effect (PLE) is the idea that every dollar you save on the production or delivery of goods adds to your bottom line, without having to sell more.
To cut costs, examine your current processes:
- Is there an area where efficiency can be improved?
- Do you want to negotiate for lower prices on products or services?
- Are you looking to save money by using new software or hiring services?
Save money to make money.
Are there businesses that are similar to yours but have a different market or meet a different customer need? This may have been something you didn’t consider when you first started your business. But, it is worth considering a partnership or collaborative effort.
You can promote each other to customers by simply sending them a newsletter, or you could get involved in bundling products. Clear guidelines should be established when collaborating. These guidelines should include profit sharing, cost-sharing, and efforts.
It’s more important than ever to be innovative in order to be financially successful. To determine whether there are any expenses that you can reduce or eliminate, audit your business. Consider tapping into your email list and upselling to increase sales. Consider the paid options, such as advertising or business investments, after you have explored the free possibilities.