What’s the real way to increase the profitability of your small business?

 

A small business, by definition, is an entity that’s privately owned and worked by fewer employees than that of a larger business, such as a corporation.

While some might classify a small business by the profits it generates, modern trends in small business show that microscopic enterprises can pull the same cash as their larger counterparts.

It’s easy to make a good living working for nobody but yourself, particularly if you’re part of an institution that’s organized to the degree of a professional small “business”.

Decades ago, a small business may have been thought of something similar to a locally owned grocery store or a deli. Now, small businesses are different than the small, locally-owned and operated shop on the corner of your street.

The pages are the same, but the fine print is different. From a wider range of business diversity to a different, more digital format, small businesses are so much more advanced in this day and age.

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The evolution of the small business has progressed to the point of small groups of people (and sometimes sole persons) being given the ability to generate substantial amounts of money.

Here’s the kicker: sometimes this amount of money can be much larger than the amount of money generated by a big-money corporation.

One more thing: if you know about the right tools, it’s easy for your small business to turn a profit.

We’re talking about knowing the profit drivers most likely to influence your sales. We’re also talking about knowing the proper metrics to focus on to best benefit your business’s earnings.

Let’s take a look at how to pull these two things together to accomplish what every small business owner, worker, and entrepreneur wants to accomplish: how to increase small business profits.

if you know about the right tools, it’s easy for your small business to turn a profit. Click To Tweet

 

Want to increase the profit in your business and your take-home salary? You’ll need to ensure that you’re focused on the right things. Download our FREE “8 ratios for better business profits” guide now.

 

The First Step to Increase Small Business Profits

In order to increase small business profits, you’ll need a two pronged approach (as we mentioned above). The first step involves identifying the most beneficial profit drivers.

A profit driver is a factor of your business that has a significant influence on its cash. In other words, it’s anything that causes an increase in the profit of your small business.

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There are many profit drivers that affect the positive flow of cash into your small business. Let’s focus on five for now.

As we discuss them, we’ll outline how each one can play a role in increasing the profits of your small business!

 

Profit Driver #1 – Increased Productivity

Productivity is a broad term. When most of us think about applying principles of practices that increase the productivity of a worker or a workplace environment, thoughts of eliminating distractions come to mind.

While eliminating distractions can often play a large role in the beginnings of a profitable small business, take a look at the issue from a different angle.

Think about how you, as a business owner or entrepreneur can delegate meager or time-consuming tasks to a third party entity like VI (Virtual Intelligence).

By delegating necessary but unintelligible or redundant tasks to people or programs that are capable of performing them you’re freeing up valuable slots of time in your schedule, slots you need to push your brand’s marketing campaigns to their limits.

When you have more time to focus on tasks that are more complex than, say, email lists, you’ll be able to maximize your business’s earning potential.

 

Profit Driver #2 – Cater to The “Ideal” Client

How can your business scale if it’s catering to the wrong audience?

Put work into finding out exactly who you need to focus your marketing energy towards. Doing this can have your business headed down a successful road, rather than sending email lists to recipients with negligible interest in what you’re selling.

The profits of your business will increase if you keep your focus on clients who best fit the product or service you’re selling.

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Profit Driver #3 – Know What Business Model Works Best

Choosing the appropriate business model for your small business will drive its profits in a positive direction.

Which one, then, is the best model for your business? That depends on what industry you’re in.

Check out this list of these successful and unique small business models that have shaken up the entrepreneurial landscape!

 

Profit Driver #4 – Sales, Sales, Sales!

You’re the root of your business’s sales, especially if you’re the main person in charge of marketing and sales.

Don’t let tasks that can be handled by someone or something else distract you. We talked about this when we discussed the first profit driver, increased productivity.

Sales are the root of any small business’s success, and as the founder selling is a key skill you need to develop

Don’t forgo the integration of automated services into your small business’s infrastructure, services that free up your time and keep your focus on the single most important thing: closing sales.

 

Profit Driver #5 – Strong Team Members

Whether your team is automated or whether they’re human, their strengths are important assets to your small business. Small businesses have the fortunate benefit of not having to rely on many people.

You have the power to pick your team, whether it’s a partner or whether it’s a dozen employees.

Regardless of whether you’re hiring a virtual assistant, project manager, sales person, outsourced marketing manager, or anybody else… be sure to choose wisely and watch your business’s profits soar.

Now, let’s shift the focus to the metrics you’ll need to focus on in order to maximize your business’s profits.

 

How to Choose Profit-Enhancing Metrics For Your Small Business

The metrics, or indicators of performance, that you choose to monitor can make or break your small business’s profits and success.

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Let’s take a look at several metrics you’ll want to monitor, all the time.

 

  • Financial Metrics (Income, Expenses, Cash Flow) – In order to increase your profit you need to take note of your profits.

Whether you’re monitoring your bank account or monitoring affiliate commissions,

financial metrics are metrics that need to be supervised, on a consistent basis.

 

  • Online Metrics (Internet Presence) – Maximize your small business profits by focusing on your company’s or brand’s awareness on the world wide web.

While a consulting based company might not need to rely much on strong internet presence, most digital small businesses need to keep track of affiliate commissions, website traffic, and ad campaign conversions.

 

  • Email Metrics – If you haven’t caught on to how simple and effective email marketing is, you need to get on it.

Simply put, email marketing is one of the most effective ways to raise your brand’s awareness and exposure.

It’s important to take note of measurements of its successes and failures, because of how important email campaigns can be in making your small business’s presence better known.

Metrics such as open rates, click through rates, and hard bounces are all important things to keep track of.

Keeping track of these metrics will help better your email campaigns and, in turn, better your business’s chances of increasing its profits.

 

Increasing Your Small Business’s Profits Doesn’t Have to be Tough..

In fact, it’s much easier than it’s made out to be. Paying attention to profit drivers and important metrics of your business’s overall performance can, for the most part, ensure your business’s long term success.

What does long-term success equal in the world of business? Increased profits and revenue.

Pay attention to the profit drivers and the metrics that matter. Watch your small business’s revenue soar towards the skies.

 

Want to increase the profit in your business and your take-home salary? You’ll need to ensure that you’re focused on the right things. Download our FREE “8 ratios for better business profits” guide now.