Ten Tips for Improving Your Profitability
You can improve your company’s bottom line by keeping a sharp eye on the needs of your customers and by improving your business processes.
These 10 tips from CPAs may improve your profitability:
- Benchmark revenue and overhead percentages to the leaders in your industry. Determine what is needed to pursue the best in your industry.
- Think of every product or service that your company sells as if it were a separate business. Does each one contribute to profitability? Identify profit centers. Keep the winners and lose the losers.
- Develop a cost accounting system to determine exactly what it costs you to deliver a service or product. Costing has to be comprehensive.
- Listen to your employees’ complaints about tedious tasks. Their ideas may result in eliminating, modifying or outsourcing the work.
- Enter into strategic alliances with your suppliers or customers to market each other’s products.
- Identify the key positions within your company that have contact with customers. Put the right people in those jobs.
- Find new uses for aging products and services. More reasons to buy mean more revenues for your company.
- Establish an advisory board of key clients.
- Give your customers what they want. If you’re meeting a need or desire, they’ll buy – and pricing won’t be their main concern.
- Conduct a customer satisfaction survey annually.