There are only two ways to grow the profits in your business:
- Make More Sales
- Improve Margins
Make More Sales
Making more sales means selling more to your existing customers and finding new customers. As you will be aware, it’s far more efficient to sell more to your existing customers so make sure you are doing everything you can there whilst you are working on bringing new customers in.
Improving margins means charging a higher rate for the work that you do, without a resulting proportionate increase in the cost of providing that service, or;
Reducing the cost of providing your services, either the direct costs associated with providing the services, or the overheads of running your business generally
None of this is rocket science and it’s likely that none of it is new to you either.
So why are you still not getting the level of profits you know you should be from your agency?
Low Quality Questions – The quality of questions you ask yourself is key.
Most business owners ask questions like:
- How can I sell more?
- What costs can I cut?
Although they appear to be valid questions to increase profit, they do not pave the way for the truly creative thinking that will make the big difference to your agency.
How can I sell more immediately gets you thinking about how you can sell more of the stuff that you already do. Now if the stuff you already do is highly profitable and it takes your business in the direction of your vision, then great. But even then, you’re in danger of jumping in to the question too quickly and ignoring bigger opportunities.
What if there are even more profitable services that you can do, that your clients will love and that match your vision even better?
The answers to the question “How can I sell more?” also restricts your next question “What costs can I cut?”. If you have already made decisions on selling more of something, you will automatically rule out any cost savings that are related to that area that you are looking to grow. Also, cutting overhead can only get you so far before it starts to have a negative effect on your business.
Higher Quality Questions – Asking higher quality questions opens up the mind for more creative thinking and better decision making.
- If I had to double the turnover of my business without hiring any more people, what would I do?
- What do our customers need that we are not currently giving them?
- What is our most profitable service? And how can we sell more of that?
- What part of the business is not very profitable? What would make it profitable or should we stop providing that service altogether?
By asking these questions you move from thinking about more of the same, bigger for the sake of bigger and generally limiting the performance of your business to optimising your results and budiling an easier business.
It’s about finding the things that give your customers the most value and you the most profit.
How to take action
Download the “Stop Growing Your Agency” ebook to get practical tips on how to get maximum results from what you already have.