Running a small business can get frustrating when you don’t make enough profits to break even. Combine that with the fact that you have to juggle different tasks as a business owner, and it gets all the more painful when things don’t work out.
According to numbers from the US Bureau of Labor Statistics, 49.7 percent of businesses don’t make it past their fifth year.
You can escape from the 49.7 percent if you know how to boost your small business’ revenue. This article will show you 10 ways to do that.
1. Conduct Cash Flow Analysis
Table of Contents
- 1. Conduct Cash Flow Analysis
- 2. Raise Product/Service Prices
- 3. Have a Strategic Marketing Plan
- 4. Have a Strong Online Presence
- 5. Maximize Cash Flow
- 6. Automate Repetitive Processes
- 7. Change Operating Procedures
- 8. Offer Excellent Customer Service
- 9. Boost Employee Productivity
- 10. Be Intentional About Employee Welfare
The numbers don’t lie. Understanding and performing a cash flow analysis regularly is critical to any business remaining solvent and improving profitability.
A cash flow analysis allows for a comprehensive review of costs to understand how a business generates money and to identify opportunities for strategic cost reduction.
2. Raise Product/Service Prices
If you’re not making enough money, you might not be charging enough. This is especially true for service-based businesses, where undercutting the competition may attract clients who do not appreciate the value you provide. It is also applicable to products.
Increasing your prices is one of the most straightforward ways to boost your profit margins. You must understand your market’s price elasticity and how your customers will react.
The truth is that price is not as objective as many people believe it to be. The first and most important step is to find customers who see the most value in your product or service.
Customers must also be willing to quantify the value they see in your product or service in terms of monetary value.
3. Have a Strategic Marketing Plan
Promoting your business without a solid marketing plan is an easy way to accrue loss as a small business owner. It’s like trying to find a red ball while wearing a blindfold.
Take the time to create a strategic, documented marketing plan to avoid wasting time and resources on marketing. It’s also critical to consider the financial implications of each strategy.
The basic tenets of digital marketing are identifying your ideal audience and understanding who they are. You have to build customer personas to know what your leads respond to, where they get their information, and their pain points.
Then you must use the right message to reach them.
4. Have a Strong Online Presence
The digital space is undeniably the new marketing space for business owners. People used to go to a physical store to make a purchase, but the game has changed. Nowadays, 80% of people will look for a service or product they require online.
There is no excuse for not having an online presence in this day and age. The majority of digital platforms are free and simple to use. Having an online presence will not only promote your business and increase sales, but it will also allow potential customers to learn everything they need to know about the services you provide at their leisure.
Your online presence helps you maintain a relationship with your customers and give them an idea about your values. This way, they get to form an opinion and determine whether you should be trusted.
to maintain an online presence, you should post regular content across different social media pages, from LinkedIn and Facebook to Twitter and Instagram.
5. Maximize Cash Flow
Offering pre-paid retainers or ongoing payment plans to your clients is one of the best ways to achieve a consistent cash flow.
For example, instead of a one-time consulting contract at $150 per hour for a full day, modify your offer and provide them with a discounted 20-hour retainer plan at $125 per hour. While your hourly rate will be lower in this case, you will be billed for a higher total dollar amount and tying your client into a longer-term agreement.
This may not appear to be as lucrative at first, but it establishes a relationship and keeps the door open for additional work.
Another way to generate new revenue is through maintenance contracts for service-based businesses.
6. Automate Repetitive Processes
Some manual and repetitive tasks take out a significant chunk of your time that should be reserved for more important business tasks. When you continue doing these tasks, you’re risking lower productivity and neglecting activities that will maintain and boost your business’ productivity.
Create a system for employees to:
- Access and enter data,
- Keep all information up to date and synchronized, and
- Include back-office administrative time in your project fees, hourly rates, or ongoing charges.
Automation keeps your business running smoothly and allows a smaller workforce to complete more back-office tasks.
7. Change Operating Procedures
You need to increase sales while decreasing expenses. Cross-selling—offering new services or goods that complement your current offerings—can help you increase your sales.
A dermatologist, for example, may also sell vitamins. Incentivizing new customers to try your product with special deals, discounts, or short-term giveaways is another operational change that can boost profits.
On the other hand, if you want to cut costs, try auditing your administrative functions. Are there any routine tasks that you could outsource or eliminate to save money? Is it more cost-effective to hire part-time help rather than a full-time employee to perform some of these tasks?
8. Offer Excellent Customer Service
The customer service you provide has a significant impact on their trust and loyalty. Increasing customer loyalty in your business means increasing customer retention.
As a result, it is critical to have highly trained support personnel who will take on this responsibility head-on.
Create multiple support channels and make sure to include them on your online platforms for easy access. When people inquire, they want answers right away; no one likes to be kept waiting.
Also, make certain that your customer service is willing to treat each customer’s issue individually; this will create a professional and personable experience for them.
9. Boost Employee Productivity
Your business depends on your employees to function and maximize revenue. Your organization won’t thrive without committed and productive workers.
How you motivate and manage is one of your most critical tasks as a business owner. There are different ways to ensure employee productivity. Let’s go through them.
Use a Time-Tracking Solution
Time trackers help you to log your workers’ billable hours. When you use a time tracker, you’re removing the hassle of creating manual timesheets and payment invoices on your part and that of your employees.
Time tracking also keeps your workers accountable and focused. When they know they’re being monitored, workers will stay committed to finishing whatever task they have on hand and can do other things when the time tracker is turned off.
Evaluate their Performance and Assign Tasks More Efficiently
Using solutions like time trackers and project management tools allows you to evaluate each employee’s performance. For example, these tools, alongside employee reports, help you understand how long a worker spent on a specific task.
You can then analyze your data to know the type of tasks they’re good at. That way, you’ll assign tasks more efficiently to ensure the entire team is productive.
Maintain an Efficient Workflow
Maintaining an efficient workflow is helping employees know who to hand over to once they complete a task. Doing that helps you eliminate roadblocks and time-wasting.
You can use a project management tool to automate and streamline the workflow. So, instead of having a worker dedicated to passing jobs around, you can set the workflow and the project manager will automatically handle the handover.
Avoid Micromanagement and Offer Workers More Autonomy
Micromanagement is an effective way to kill productivity. It disrupts focus, kills morale, and reduces creativity.
Research has shown that employees will perform at a lower level if they believe you’re constantly watching them and controlling how they should work.
So, your focus should be on the results of your employees’ work, rather than their process. If you allow them to determine their approach to work, you’ll be encouraging them to find their rhythm and increase speed and efficiency.
Employee autonomy is one of the best ways to boost workplace creativity, innovation, and commitment.
You can check up on your workers from time to time to get project progress reports or allow them to send the reports at intervals while working.
Run Reward and Recognition Programs
Studies have shown that workers in different sectors receive a morale boost when they’re recognized for their work. They’ll be more loyal and motivated to produce great work if they continue to be appreciated for their hard work.
So, you should create a program that allows you to reward performing employees so they can keep repeating great work. For example, you can use an employee recognition program or reward portal to systematically track employee contributions and reward them.
10. Be Intentional About Employee Welfare
Your employees’ well-being has a significant impact on your revenue. First, it determines how productive and creative they’ll be and sets the mood for your business environment. Secondly, it sets the tone for your company’s reputation. If customers get wind that you treat workers unfairly, they’ll avoid doing business with you.
So how do you ensure your workers’ welfare?
Prevent Overwork and Burnout
The WHO (World Health Organization) reports that working long hours can cause health issues that may lead to death. So, make sure you monitor your employees’ workload and discourage them from taking on more than they can handle. You should also implement a favorable working hours policy.
Provide Support for Mental and Physical Health
Most employers in some countries are required by law to provide some form of medical benefit to employees. You should also follow this practice and provide support in terms of resources, counseling, and training when it comes to mental and physical health.
Create an Empowering Company Culture
Ensure your company promotes a culture of inclusion and empowerment. Remove workplace stressors that could derail an employee’s motivation to work and affect their mental health. To do that, you can collect feedback to identify what workers are not comfortable with within the workplace.
Remember to be Consistent
To make the tips above effective, you have to be intentional and consistent. Send out questionnaires and receive feedback from time to time, continue boosting employee productivity, and customer support should always be excellent.