A Simple Approach to Achieving Profitability
We posted this on LinkedIn not long ago and it absolutely oversimplifies things but at its core, producing good income really does happen this way:
1) Get good bookkeeping - hire help!
2) Review financials regularly - and know what they're telling you
3) Track metrics (scorecard) and cash flow
4) Make adjustments based on data
There's a lot that goes in within each of those steps but simply stated it's: accounting, financials, and metrics.
One of the biggest challenges I see is overlooking the very first step. You won't get anything out of a financial review or metrics without quality financial statements.
2023 is coming to an end but there's still plenty of time to get the books in order, review your results, and plan for a successful 2024.
THE PROFIT TIPS ARE STILL COMING...
Last week we commented on our "365 days of profit" campaign where we'll share daily tips and tricks to inch toward big profit improvement over the next year. Here are the next 7 tidbits from the past week:
Look for unprofitable customers and prune them yearly
Segment your customers to tailor your marketing efforts and pricing strategies
Optimize your inventory to avoid overstocking or running out of key products
Offer upgrades or premium options to increase the average transaction value
Use expense tracking software to monitor and categorize your business expenses
Negotiate with suppliers for better terms and pricing
Develop clear job descriptions and performance expectations
Want more profit?
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