Posts Tagged ‘profitability for small businesses’

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Consumers are increasingly using mobile devices to buy

In mid 2015 Google announced that mobile-friendly websites will be rewarded with higher rankings on searches done using mobile devices. Ranking higher definitely means more exposure for your small business.

The latest consumer statistics show that Smartphones and emerging mobile devices e.g. Smartwatches are increasingly becoming more popular for purposes of searching the internet. Clearly, more mobile visitors are what entrepreneurs need in order to boost sales volumes. Accordingly, it’s well worth knowing just how to go about doing this…the infographic below will help you do exactly that.

How to Get More Sales From Your Mobile Visitors
Courtesy of: Quick Sprout

While it’s good to know that having a mobile-friendly website will help to enhance the success of your small business, it’s definitely worth appreciating the fact that you also need to work smart. You see, spending more of your time working doesn’t always mean you’ll be successful.

The key to being a successful person is not working more, but working less and working smarter. If you want to be successful, get more done, and work less, take some time to learn from these 7 practices of successful people.

How Successful People Work Less and Get More Done

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It’s just not worth calling yourself an entrepreneur if you can’t think through the relationship between revenues and profits. Willful ignorance on the part of lots of small business owners might just be the reason why they are caught up in this quandary. Entrepreneurs should ideally be concerned about how healthy their profit margins are because this will…(Read the entire post here)

Top entrepreneurs have what it takes to steer their businesses through tough times...GRIT

Top entrepreneurs have what it takes to steer their businesses through tough times…GRIT

When times get tough a large business typically makes it through and even achieves growth by harnessing its superior capacity to access capital, bargain better terms, and pursue a greater scope of investment options.

A small business on the other hand has to do all it can to avoid going down during a financial slump. Ill-advised knee-jerk reactions to such a scenario may include the prompt laying off of some employees or shutting down of some branches.

More prudent business owners will however be more intuitive in their responses. They’ll want to know what measures can be implemented to keep the business afloat until profitable winds start blowing again.

By adopting a survival mentality there is a good chance that your business will remain intact through crisis times. You will also find it easier to pick up and continue when the economy rebounds.

This is unlike a business that opted for rash responses, such as the ones above, which are really last resort measures. Such a business will no doubt lose momentum seeing as time, money and other resources will have to be expended in hiring new employees, securing premises, winning back lost clients, etc.

What therefore are some of the strategies you can embrace to cope with crisis times?

1. Reinventing your business

After all, necessity is the mother of invention...

After all, necessity is the mother of invention…

When times are good many small business owners direct all their focus on making the most of the currently available opportunities. This is all good but it’s done at the expense of diversifying the scope of focus.

For such a business, a slump in demand and sales has an almost crippling effect on operations and the owner may be at a loss about how to proceed.

How about recreating the business? Start by analyzing your strengths and weaknesses and then think about another sector of market where you can be a fit.

  • Consider your current products/services; does demand still exist or have customers preferences changed?
  • What are the new trends in your industry; have you kept up?
  • What steps can you take to become relevant again?
  • Do you need to develop new products/services?
  • What is required?
  • Do you know what customers need and how much they are willing to pay?
  • What new products/services can you develop?
  • How will you best reach the new clients?
  • Do some of your old clients fit in your new target market? Can you use them to get more customers?
  • Will these products/services earn you maximum profit?

Repackaging your business and getting back on track may take some time.

Take heart though.

The course of action you opt for will most likely be quite familiar to you (thanks to your experience so far) such that making inroads won’t be too difficult.

2. Create other revenue streams

Can you think of other ways to earn money in addition to your core business activity?

Can you think of other ways to earn money in addition to your core business activity?

You must start thinking about how else you can earn revenue in addition to what you are doing currently. This is about finding out what else you can do with the current resources at your disposal.

If, for instance, you own a barber shop and business is slow because three new barber shops have opened up on your street, why not think about offering other men’s grooming services. Many men are now warming up to manicures and pedicures. How about making your shop a one-stop grooming shop by partnering with personal beauty pros?

3. Seek out your former customers

Pick up the phone and call past prospects - perhaps a deal can be struck

Pick up the phone and call past prospects – perhaps a deal can be struck

You never know. What harm can there be in finding out? Who says a former customer can’t be convinced to start buying again? Perhaps he or she is disappointed with a current supplier’s quality.

Are there customers who left because their priorities changed? Might they have changed again? Why not find out if their current preferences are within your scope? Perhaps they can even refer new clients your way.

Maintaining a professional relationship does have its perks.

4. Find former prospects and other people on your contact list

Find out if your contact lists can yield new leads

Find out if your contact lists can yield new leads

When times were good and demand was booming you probably had several cases where potential business deals fell through for one reason or another.

Perhaps some projects you were eyeing didn’t materialize because the prospects had to put them on ice at the last minute.

Try getting in touch with such prospects to find out if such opportunities still exist.

5. Make strategic alliances

Create mutually-benefiting relationships with other businesses; seek and return favors

Create mutually-benefiting relationships with other businesses; seek and return favors

It is worth exploring the industry to find businesses that you can work together with for strategic benefits. This can expand your scope of exploitable opportunities meaning that you’ll still be in work even when your core area’s prospects become lean. Sooner or later you’ll be the one extending the favor.

Also, having a strategic partner will help to propel your market penetration efforts considering that you are most likely facing off against bigger competitors.

6. Explore the online marketplace

Aggressively sell your products/services online

Aggressively sell your products/services online

Many offline businesses owners may be surprised to find out that there are lots more potential customers online.

Don’t be ignorant; simply find out if this is the case and how you can exploit the potential.

Perhaps you do sell online but you are experiencing declining sales. Now is the time to find out if your previously successful strategy has been too limited in scope and if there are new channels to discover. Find out which aspects of your e-commerce site must be improved. Perhaps your marketing strategy is inefficient. How can this be revamped?

7. Make the most of free publicity

If your business has interesting things to offer people will talk about it

If your business has interesting things to offer people will talk about it

Whenever you get the chance to spread the word about your business don’t hesitate to do so. Word-of-mouth is highly effective and absolutely free – find out ways to always be on people’s lips.

8. Start doing more on social media

Use social media to optimally market your business

Use social media to optimally market your business

Simply having a social media presence is not enough – you must get active in these channels.

Start interacting better with your target audience. Take time to post comments regularly. Ensure that clients’ questions and comments are responded to promptly. Engage your audience by discussing matters related to your products/services and the industry at large. Don’t forget to advertise your product/service on social media.

9. Make your business mobile-friendly

Your business should move with the times - embrace the mobile platform

Your business should move with the times – embrace the mobile platform

An increasing number of people (read your target audience) are becoming accessible via tablet and smartphone for a greater part of the day. This as opposed to when desktop computers and laptops were the only means of internet access. Is your business mobile-savvy yet? It needs to be.

10. Review your business budget

Reviewing your budget downwards will be absolutely vital

Reviewing your budget downwards will be absolutely vital

This is very applicable for small businesses that have departments to handle various operations.

Require your managers and supervisors to list suggestions about how expenditure can be reduced in their respective departments. To motivate them you can pose this as a challenge. You can, for example, promise a handsome reward for the departmental head whose cost-cutting initiatives resulted in the greatest percentage reduction in allocated budget.

You should also consider the expenses you can influence directly and immediately. Is it possible to opt for a cheaper package for your telephone and software requirements? Have you been taking advantage of attractive discounts and deals typically offered by service providers?

How about the lease terms for your premises or equipment? Are you being overcharged considering current market rates? Are there cheaper options?

11. Find new ideas for profitability

Now, more than ever, is the time to summon your  firm's creative minds

Now, more than ever, is the time to summon your firm’s creative minds

This should also be done in collaboration with the staff. Now is the time to really brainstorm for viable ideas that can actually be implemented in the short-term to alleviate the crisis. Winning ideas should be well rewarded.

12. Rethink your positioning

Giving your business a unique market proposition is a sure way to draw more clients

Giving your business a unique market proposition is a sure way to draw more clients

Think about how you can uniquely present your business to the target audience.

What are some of the qualities you think that only your business can offer customers?

Re-position accordingly and let your customers and prospects know about the extra value they’ll get by doing business with you.

13. Make your turnover rate faster

Find out why your stocks are taking too long to sell and then make amends immediately

Find out why your stocks are taking too long to sell and then make amends immediately

Review your business operations to find out what practices are encouraging slow turnover.

Is it that your inventory lies idle for lengthy stretches? Find out if you can purchase less stock instead of tying down too much money at the expense of your profits.

Is it that many of your customers are simply taking too long to pay up? Perhaps offering attractive discounts for prompt payment will help.

Perhaps some of your products are taking too long to sell. Think about reducing package quantities, or end production altogether.

14. Negotiate better terms with your vendors

Convince your suppliers to extend your payment periods

Convince your suppliers to extend your payment periods

To secure better cash flow for your business engage your vendors and convince them to give you more time to settle your invoices. Use this cash to keep operations flowing.

15. Revise your payroll cycle

Paying your staff less often will enhance the firm's cash flow

Paying your staff less often will enhance the firm’s cash flow

This will generally work in the same way as no.14 above.

Perhaps you currently pay your workers weekly – change this to biweekly. In case you currently pay them biweekly, change this to monthly.

You will not only have better cash flow but it’s possible that current payroll processing costs will be significantly reduced, more so if you have a large workforce.

16. Go green and minimize wastage

Insisting on energy-saving initiatives will result in considerable power bill savings

Insisting on energy-saving initiatives will result in considerable power bill savings

Take all the necessary measures to ensure that energy costs are trimmed. Basically, adopt energy-efficient practices at your workplace.

Ensure that all lights are switched off when they are not required. All office equipment must also be unplugged at the end of the day.

According to the ENERGY STAR program 40% of electricity consumption by home electronics happens when they have been turned off but not unplugged. The potential savings that you can make on costs of power are evidently quite significant.

The same measures should be taken for everything else including time. Enact a strict policy against lateness and inability to meet deadlines.

17. Cut down on travel expenses

Video-conferencing is so much more cost-effective as compared to traveling

Video-conferencing is so much more cost-effective as compared to traveling

By taking advantage of technology you can significantly trim your travel budget. Have you considered video conferencing?

Again, do you really have to fly first-class? How bad can business class be?

18. Consider making changes to your workforce’s employee status

Hiring freelancers and independent contractors will significantly lower your wage bill

Hiring freelancers and independent contractors will significantly lower your wage bill

If you have hired your team on full-time basis you may want to consider making them independent contractors.

Assuming you have been honest with the team about the current situation they will most likely appreciate that they’ll still have jobs.

Their new status means the business will no longer have to pay payroll taxes and/or health insurance benefits, all translating into money saved.

Knowing how to stay afloat during hard economic times is crucial in determining whether your business will survive or go under. Has your business had to ensure such times? What was the crisis like and how did you pull through?

Cash is truly king!

Cash is truly king!

To grow and make a success of your small business you must embrace prudent cash flow management. The old business adage “cash is king” has very practical implications for business owners.

Indeed, while long-term business failure results from an inability to make profits, short-term business failure happens when a business doesn’t have enough cash to pay its bills.

The basics of prudent cash flow management are rather obvious. Money inflow must exceed money outflow.

Money inflow must be prompt and timely to facilitate new stock acquisition and payment of suppliers. When cash is easily accessible you can considerably tilt buying and negotiating terms in your favor; this will no doubt boost profitability in the long-term.

Good cash flow management will also enable you to better anticipate shortfalls in money inflow thus allowing you to initiate timely contingency measures e.g. securing favorable credit terms.

What therefore are some of the prudent cash flow management practices that you as a small business owner should implement?

1. Reviewing your cashflow systems

Regularly review your cashflow systems to ensure that the business is not losing money

Regularly review your cashflow systems to ensure that the business is not losing money

Begin by going through your cashflow system in order to identify possible loopholes through which the business may be losing money. Accordingly, put in place a system that will ensure customers are always invoiced for products/services sold and promptly so. Now your system should at a glance show what is owed to you by clients and what you owe your suppliers.

You should also be able to quickly ascertain that you are only paying for supplies received; failure to do this may result in some of your suppliers routinely overcharging you and/or billing you for supplies not received.

It is also worth working out a payment structure that will see you make payments to different suppliers on different dates over a suitable time period instead of paying all of them at once.

2. Creating sales projections

Accurately estimating sales volumes and inventory requirements enhances cashflow management

Accurately estimating sales volumes and inventory requirements enhances cashflow management

Monitoring daily sales will help you to accurately estimate your inventory requirements. You will thus be able to make well-informed purchases and thereby avert the possibility of overstocking inventory for which you will incur storage and maintenance costs.

Additionally, referring to past quarterly sales and future estimates will help you to sensibly budget and plan for inventory purchases.

3. Insisting on deposits for large orders

Insist on receiving a deposit when the order is substantially large

Insist on receiving a deposit when the order is substantially large

Upon receiving a large or unique order it is prudent to insist on a security deposit that is equal to or more than half the total price. A distinct characteristic of unique products is that they have a limited sales value, typically to the person making the order.

In the event that these products are no longer considered as valuable to the client as before, you become subject to the risk of receiving a lesser payment than was initially agreed. Insisting on a deposit will therefore go a long way in helping to reduce your financial loss should things go haywire.

When you are the one making orders, however, try and avoid paying deposits. This especially applies when you are dealing with suppliers well known to you. Simply ensure that your credit history and relationship with a supplier remains positive over the long-term and this will spare you the need to make deposits. This cash can serve better purposes elsewhere.

4. Designing beneficial terms of payments for large orders

For significant orders you may need to come up with mutually beneficial terms

For significant orders you may need to come up with mutually beneficial terms

Sometimes it may be impossible to demand for deposits upfront e.g. if the client firm has limited financial muscle or has a policy against making initial deposits for orders. A proactive business owner will in such a case come up with a negotiable payment plan based on tangible benchmarks.

Not only should such a plan be agreeable to both parties, the payments made should suffice or exceed the costs incurred in delivering the order.

For example, given an order to screen-print 1000 t-shirts, the printer may require the client to make a 15% payment after the t-shirts have been purchased, another 35% after the screen has been designed and inks purchased, and 40% of the total agreed amount be paid in four installments as batches of 250 t-shirts each are delivered. Only after all the 1000 t-shirts have been delivered and inspected for quality will the remaining 10% be paid.

5. Offering discounts to encourage quick payment

Make your terms as attractive as possible to encourage prompt payments

Make your terms as attractive as possible to encourage prompt payments

To accelerate cash inflows it might be a good thing to offer discounts to clients who will remit payments well before normal payment term periods elapse.

Typically, invoices are meant to be settled 30 days after receipt, but if payment is made within the first 10 days a 2% discount is given.

Knowing your clients payment habits and your business’ requirements you can make a decision to make this discount rate more attractive for clients who are habitually late.

Such an approach won’t work across the board though. It might work when you are trying to secure more business from a promising startup but you certainly mustn’t apply it for a big client who gives you big business every month but always pays up after 40 days.

6. Enforcing credit terms

Don't hesitate to enforce your terms when payments are not forthcoming

Don’t hesitate to enforce your terms when payments are not forthcoming

Your cashflow will suffer when you extend credit to slow-paying customers. Having identified such clients you need to negotiate new terms that will compel them to settle their accounts quicker.

New clients must know that your business is very particular about prompt payments. Prior to doing business with new clients it is prudent to check their credit reports.

7. Harnessing cashflow management technology

With the help of accounting tools like QuickBooks and Pulse you will have an easier time figuring out your cash inflows and outflows, keeping track of due receivables and payables, and so on.

8. Making the means to get paid more convenient

PayPal greatly conveniences buying and selling

PayPal greatly conveniences buying and selling

As a small business owner you need to make it easy for your clients to make payments.

You can, for example, invest in technology from Tradeshift or Basware to allow your clients to pay invoices via the Cloud. This will not only hasten cash inflows but will also help to avoid the errors and delays characteristic of the paper invoice trail.

Yet another option courtesy of Zapper Scan-to-Pay is to issue clients with invoices that feature QR codes. Using a smartphone a client simply needs to scan the code, confirm the amount, and make payment, all within a couple of seconds.

Other payment options you can avail for your clients are PayPal, Eftpos and credit cards.

9. Ditch pitching in favor of attracting new customers gradually

Gradual nurturing of business relationships is a much better way of finding new clients

Gradual nurturing of business relationships is a much better way of finding new clients

Sourcing for new business opportunities via pitching has been shown to be counterproductive seeing as time and resources are expended on an exercise that may not yield any income.

Today, many small business owners are attracting new clients by gradually growing relationships with them. Beginning with informal interactions and conversations, such a relationship grows from strength to strength as required. With several such relationships it is almost certain that new business will continually become available moving forward.

I sometimes think that this approach is akin to organic SEO where visitors tend to prefer/trust naturally-ranked (gradual relationships) websites more as compared to paid results (pitches).  

10. Opening a business credit card

It's prudent to have separate credit cards for personal and business use

It’s prudent to have separate credit cards for personal and business use

Keeping personal funds and business funds separate is a no-brainer.

With a business credit card you will easily be able to keep your business and personal credit separate, build the business’ credit, and avoid a scenario where qualification for business credit will need backing from your personal credit.

Keeping these lines of credit distinctly separate is one of the basics you must comply with if you have your sights set on more investment and business growth.

11. Offering fixed rate payment packages to your clients

Offering your service as a periodic package will guarantee regular cashflow

Offering your service as a periodic package will guarantee regular cashflow

Periodic payment packages are quite ideal for purposes of ensuring that good cashflow is sustained. This approach can work really well for businesses that have traditionally used the hourly rate as the basis for payment e.g. freelance writer services.

With the hourly rate there is really no way of estimating what your income will be month to month. However, developing retainer packages based on a fixed number of hours per month, and having clients pay up in advance, is an effective way to take total control of your finances.

Getting payments in advance means that you can account for your spending and business growth using actual figures rather than estimated ones that may eventually not tally considering that some of the arrears may never be settled.

12. Maintaining and repairing rather than replacing capital equipment

Regular equipment maintenance is crucial for  prolonged service life

Regular equipment maintenance is crucial for prolonged service life

Your business will enjoy better cashflow if crucial equipment is well maintained and expertly repaired when damage occurs instead of being replaced immediately. As a business owner you should ensure that equipment undergoes regular maintenance in order to detect/forestall possible damage and to restore efficiency.

In case some parts need to be replaced opt to source for these from third-party suppliers rather than the original manufacturers because the latter option is certain to be way more expensive. Also, find reputable technicians to handle complex repair/maintenance tasks instead of reverting to the manufacturer.

13. Going for used equipment instead of new equipment

Used equipment is cheaper to buy and typically offers satisfactory service

Used equipment is cheaper to buy and typically offers satisfactory service

Scour the marketplace in search of well-maintained used equipment when it becomes necessary to purchase additional or replacement machinery. Every now and then you will come across ads and auctions notices giving sale details of some equipment you may require. Buying such equipment will typically see you spend just 20-30% of a new machine’s price; the used machine’s capability will nevertheless be equal or just slightly less than what you would get from a new machine.

Leasing equipment can also be considered when your business’ cash flow is faltering. Expect to spend more in the long-term though.

14. Selling off obsolete/excess equipment or inventory

Retaining idle/obsolete machinery can be quite expensive

Retaining idle/obsolete machinery can be quite expensive

Having idle equipment at the workplace translates into wasted space and tying up of capital that can be devoted to other more productive causes.

Excess inventory is always at the risk of becoming worthless or obsolete especially where customers preferences change rapidly and new materials are rapidly adopted.

Inventory that you are unlikely going to use in the forthcoming 12 months may be worth selling off especially if retaining it will be substantially expensive and expected proceeds from the sale minimal.

15. Adopting subscription sales

Magazine subscriptions are paid for upfront; this is greatly convenient for the service providers' cashflow

Magazine subscriptions are paid for upfront; this is greatly convenient for the service providers’ cashflow

Subscription programs are best created for businesses whose products are repeatedly repurchased and consumed multiple times a year e.g. magazines and landscaping services. You might want to think of this approach as a means to boost cashflow considering that customers will be required to prepay for the products and delivery. This arrangement will allow you to secure future sales and cover the expenses involved.

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Upon launching your startup, and for much of its existence stage, one of your main concerns will be how to keep cash flow steady. Down the line though, as the business and its revenues grow, your focus will shift towards profitability.

The fact of the matter is that running a business that isn’t earning profit doesn’t make much sense. Simply put, doing business is about being profitable. And what is profit? It’s the difference between sales and expenses.

Is that it? No, I’m afraid.

Just making a profit isn’t good enough. You need to make good profits. In business speak, you need healthy profit margins.

So, what can your small business do to increase its profit margins while operating at current capacity?

These are some of the strategies you can employ in this regard.

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1. Leverage on your expertise

Customers will readily purchase products/services from persons whose expertise they trust. Whatever your industry, you must prove your proficiency. There are many ways of doing this. Running a blog is a good example. Through your website you can share informative contents and engage your target market in pertinent discussions. Combining this with social media will greatly maximize your reach.

Nevertheless, this trust can neither be earned overnight nor can it be bought. It will take time and continuous effort to create a solid reputation and be viewed as an authority.

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2. Charge different prices for the same thing to increase margins

Unless you are in a business that deals with products whose prices are standardized, you don’t have to charge each customer the same price for your product. There are of course some customers who have less price sensitivity compared to others. Charging such customers a higher price will help to improve your overall profitability.

3. Increasing your prices

You have to adjust your prices upward after suppliers raise theirs, ensuring that your new price will give you a similar or possibly better profit margin. Of course your new price has to keep up with what the competition is charging.

For businesses where prices are unique, say in the creative arts industry, customers are not too concerned about the prices as they are about the value of the artwork. You, as the producer of the artwork, may be reluctant to start charging more but you have to consider your ever-increasing overheads. A decision to raise your prices may result in the loss of some customers but it’s quite likely that your margins will become healthier as a result of selling to fewer but better paying clients.

Again, you may have to lose certain customers, especially the price-sensitive type, to become more efficient and profitable.

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4. Compete on value, not price

This applies for service businesses. By adding value to your service delivery you can manage to make a better profit margin, substantially exceeding that which you could have made by offering an industry-standard sort of service.

A barber can comfortably charge higher rates for the same basic service by ensuring that his clients are always extremely comfortable. Installing several flat-screen TVs with cable channels, investing in cozy leather seats, and having the staff dress in clean uniforms, etc, will likely make a better value proposition for clients and they’ll gladly pay more.

5. Stop offering discounts

Offering a discounted price implies that you’ll have to sell more units of the same product to make the same profit. You are already struggling to sell a certain quantity of product, why make your work even harder? Or are you such a workaholic that enjoying a day off doesn’t make sense?

6. Are your bills accurate?

Always keep an eye on the bills you are paying. Some crafty suppliers may decide to charge you for products or services you haven’t received, or charge wrong (read higher) prices. Simply paying up without checking such details is self-defeatist.

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7. Curb theft

Any form of theft that happens in your business implies a loss of profits. Don’t condone the vice. Install the necessary systems to prevent pilferage be it through shoplifting, ‘erroneous’ bookkeeping, employee theft, or any other way that this is being done.

8. Introduce an effective inventory management system

With the help of such a system you’ll be able to reduce incidences of stock theft and stock obsolescence, know when batches of your top-performing products need to be replenished, and calculate the costs of making your products.

When it becomes easy to monitor such checks and balances you’ll have the ability to ensure that just the right amount of working capital is tied in inventory.

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9. Concentrate on marketing to your existing customer base

While seeking out new clients for your products is imperative, those that already exist are the ones you need to focus your sales efforts on. The idea here is to make them repeat customers. Building from their initial purchases, reach out to them and propose “limited time” offers for “esteemed clients”. This way it should be possible to earn regular business from your customer base, effectively increasing your sales volumes and overall profitability. Don’t forget that satisfied customers won’t hesitate to refer new customers your way.

10. Focus on industry-oriented marketing

Targeting potential customers within one or two specific industries is guaranteed to be more effective than trying to sell across the board. Not only is industry-oriented marketing time and cost-effective, you will soon enough earn a reputation for industry expertise. The result will be more referrals, lower cost of sales and higher service rates, and subsequently increased revenues.

11. Outsource whatever isn’t part of your core business to minimize your overheads

Outsourcing business support services to reputable providers will allow you to become more efficient in your core business activities. Your freelance writing firm should ideally concern itself with hiring writers – especially remote ones if this is feasible. You can outsource everything else including telemarketing, accounting, bookkeeping, payroll administration, etc. This way you won’t have to foot additional expenses like employees’ health insurance, taxes and benefits.

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12. Appreciate employees in order to get the most from them

When building a team you must be keen to hire guys who are not only highly qualified but also those who seem to ooze genuine passion for the industry. The more enthusiastic your team is about the job, the more productivity you can expect.

Play the part too. Make sure that they are working in the best possible environment. Learn to trust their abilities, encourage innovation and new ideas, and treat them as equals. Soon enough you’ll start earning dividends in the form of increased profitability.

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13. Invest in the right equipment

With appropriate equipment you are more or less guaranteed improved efficiency, less incidences of error, reduced costs of production, and improved safety for your employees. The decision to replace outdated equipment with modern versions will most likely be quickly vindicated by vastly improved productivity, efficient energy consumption, and reduced wastage.

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14. Take calculated risks

In an industry where competition is rife you may have to adopt a novel way of doing things in order to stand out from the pack. Such a decision has to be well thought out though; you must consider what your options will be in the worst case scenario.

Don’t let fear hold you back. Entrepreneurship is, after all, about risk-taking.

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15. Take advantage of your flexibility

A small business is, unlike bigger entities, able to rapidly re-configure its business model and thus serve its clients better.

Don’t be too rigid. It is possible that you will thrive best doing something entirely different from what you set out to do at inception.

16. Infuse creativity into the creation of your products/services

Creative thinking will allow you to come up with products/services that are unique. If partnerships and collaborations are what is required for this to happen then why not? Provided that your business’ mission and values won’t be eroded, and the proposed direction makes business sense, there is really nothing to hold you back.

17. Cut out laggard products/services

While you may have several cash cows that are responsible for virtually all your revenue and profits, it is your laggards that are steadily pulling you down.

You need to be objective in such a situation.

If you’ve tried long and hard to push these products to the market but still don’t have much to show for your efforts, the best solution may be to discontinue production altogether.

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18. Learn from the competition

Despite being confident that you are doing far much better than your competitors, be humble enough to realize that you can learn one or more things that you can implement and improve your operations.

Then again, you just might discover some things you definitely shouldn’t do; such should help to nurse your bruised ego!