Chapter 2 – Financial Control – Rule your money
This is part of the ‘How to’ coaching series. An ongoing series of activities to make your business successful. Follow it step by step and see positive results as you develop a robust business model, set on a solid foundation.
Activity 34 – I have more than 5 Strategies in place to increase my margins
If having a strategy to increase your margins is a good way of raising your net profit, just imagine what more than 5 will do.
It is useful to develop a schedule for the development and implementation of your margin strategies.
Rather than make huge changes in one go, consider bring them in over a sensible timescale. That way you will see which ones work, and which are the best. You will see how well (or not) the changes you make impact the bottom line.
I shared 5 ideas in the ‘HowTo’ post number 33. Those are a good place to start.
What other areas can you think of that would make your margin better?
The ‘HowTo’ bit:
Here’s one to think about; develop a greater awareness of your brand, increase the perceived value of your products/service…. ‘reassuringly expensive’ for Stella Artois comes to mind. How about improving the design & packaging of your product, and then raising the prices.
Another way is to offer a selection of offerings. Something like, basic, standard or deluxe for your service. The work you provide will be basically the same, with some additional low/non cost features. That way the customer can choose. If the customer is influenced by the extra value offer, they will usually choose the middle or upper level.
Having wondered about how to price a service, the client decided to offer a selection of 3 levels of service. These were very similar in cost to provide. They had different price points; and, you’ve guessed it, nearly every customer chose the best – it’s all about perception.
So, with this in mind, build a list of margin increasing actions to put in place and work out a schedule to implement them.
If you would like to learn more about this process and how to implement your margin increasing program, Contact Us…