Top Tips
Principles of profitability = long term success
Cash flow is the lifeblood of any business, but with sixty per cent of
businesses failing within their first year*, Bibby Financial Services is
urging all companies to take action to ensure their profitability and
ongoing success.
As a specialist provider of cash flow solutions to small and medium-sized
businesses, Bibby Financial Services understands the ‘profitability
pitfalls’ which arise on a daily basis within both new and well-established
firms.
David Robertson, chief executive of Bibby Financial Services, said:
“Business owners and managers will regularly be faced with a multitude of
everyday tasks that may result in them loosing track of their main focus
which has to be generating new business and making money. Quite simply
profitability equals success – if a firm does not generate sufficient
revenue it will fail.”
In order to help business owners and managers stay focused on generating
revenue and creating a profitable company, Bibby Financial Services has
developed the following tips:
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Review operating costs – minimise costs wherever
possible. Look at where your business spends its money. Are there any
areas that can be cut back without impacting on the quality of your
product or service?
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Profitable customers – a handful of your customers can
be responsible for a large proportion of your profits. Identify these and
aim to build long lasting relationships and new revenue streams with
these important customers.
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Diversify your product range – creating new product
lines will not only expand your range, it will also assist in keeping
existing customers satisfied and may also lead to attracting new
customers along the way.
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Know your worth – Are you charging enough for your
products and services? Review your pricing structure to ensure you are
keeping up with inflation and the broader market.
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Research suppliers – review existing relationships with
suppliers. Are you getting the most for your money? Shop around and
change supplier if necessary.
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Learn to negotiate – if you don’t ask you don’t get.
Talk to your key suppliers and ask about early settlement and loyalty
schemes that you may be able to benefit from.
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Buy in bulk – consider buying raw materials and supplies
in bulk at a cheaper price per unit. This could lead to significant
savings for the business.
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Everyone loves an incentive – consider offering
incentives to both staff and customers who exceed sales or new customer
targets.
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Work smarter – investigate whether marketing or
promotional funds are being used to their full effect. If you are
not actively marketing your business, then steps should be taken to put
this right – you must make it as easy as possible for new clients to
discover your products or services
David Robertson added: “Running a business is an exciting, rewarding
journey that many people aspire to experience. Having taken the plunge,
it’s vital not to let your chance slip away, , those owners and managers
who combine careful steps to ensure profitability and who have the
determination to succeed stand to reap the benefits of building a
successful business for years to come.”
