Where Your Business May be Losing Money and How to Plug the Leaks
In order to maximise the profits of your business, it is essential that you reduce the amount of money you lose. While you may offer a great service or sell a good product, losses will still eat into your overall profits. By identifying these large areas of loss, you’ll be able to stop the financial bleeding while increasing your business earnings.
Consider the following ways your business could be losing money. Solving these issues will go a long way toward the future success of your company.
Processes that are Inefficient cost your business a lot of money. Finding good customers quickly is critical, so when you spend money on advertising, you need a return on your investment as soon as possible. Employing the wrong advertising campaign can be a waste of money if it doesn’t bring new business in. Inside your company, one employee can be holding progress back, or an entire process could be slowing down your profits. Identify and resolve the inefficiencies, and you’ll see your monetary losses decrease.
Purchasing Expensive Equipment Up Front
While it might be tempting to invest in expensive office equipment, such as printers and photocopiers, right off the bat, doing so could tie up needed capital and even lead to losses down the road. When you purchase equipment, you are now responsible for their maintenance, and any issues they may have. You are also obligated to sticking with a model for a long period of time, and it will be difficult to upgrade to more efficient models when you need to. When you instead invest in photocopier leasing, you aren’t tying up your cash flow.
Employee Training and Turnover
If you are like most businesses, you probably spend a lot of money hiring and training new employees. Your goal is to find staff who remain with your company for as long as possible. Having consistent staffing will make a big difference in your workplace productivity, as well as your customer image. Customers appreciate seeing a familiar and friendly face when they come to your door.
There are several ways to approach this. Take more time to find the right applicant, and pay more attention during your hiring process. If the first five candidates don’t impress, interview five more. Provide intensive training for your employees, and meet with them often to evaluate their progress. Go over your processes with them and make sure they fully understand what they are expected to do.
Following Up Too Late
When a customer contacts you, it is crucial that you respond immediately in order to increase your chance of success. If you aren’t able to take a phone call right now, make sure you call them back as soon as possible, preferably within a couple of hours. Not replying promptly could result in the customer contacting one of your competitors instead.
Streamlining your workflow can help you reduce the time it takes you to respond. Check emails every couple of hours, and get back to the customer right away. When you reach out to your customers in a timely manner, you will increase your chances of securing a sale. Failure to call the customer back within a reasonable amount of time will cost you money when they take their business to another company.
Outdated Marketing Campaigns
To be successful in any business, you must stay up to date with the times. Corny catchphrases, slogans and mottos might have been popular years ago, but not many people respond to that type of advertising anymore. A direct marketing campaign has to be much more nuanced now than in the past. Consider an overhaul of your present advertising campaign, and seek outside help if needed. Improving your advertising can improve communication with those who buy your service or product.
If you want to earn money in business, you need to be able to control the money that you currently have. If your expenditure is totalling at a higher figure than your income, it may be time to re-evaluate.