by Brian Sutter, Director of Marketing, Wasp Barcode Technologies
These days, almost every business has to evolve. Someway, somehow, over the years things change. And if you want to change with them (or maybe just retire), usually it takes a little money to make it happen.
And so you need more sales. More revenue.
2017 has been a good year for growing revenue. 69% of small business owners expected revenue growth this year. They expected hearty growth, too: 38% expected revenue to rise by more than 5%.
If you’d like to join them, here are a few ways to get there:
1. Optimize your website.
If your company is “brick and mortar”, you may think you’re exempt from this tip.
Even if you’re a roadside stand in the middle of nowhere, you need some kind of website. Even a one-page website.
So go look at whatever website you have, and make it better. Put a photo of the front of your business up. See if you’ve got any online reviews on Yelp or Google or Facebook. Answer every review your business gets – even the bad ones.
If you’re a bigger company, and you’ve got a website, start “optimizing” it. Whatever profitable thing people do on your site… start trying to make that thing more profitable.
- Make it easier for them to find you (add a map and directions).
- Make it easier for them to contact you (let them text you, add a contact form).
- Write a page on your site about what your customers should know before they work with you.
Even a roadside gas station in the middle of nowhere needs a digital presence now. And because improving that presence is often free or nearly free, this is an easy way to increase revenue without spending a lot of money.
2. Sell more stuff to your existing customers.
Here’s a few ways to do this:
- Add services to products.
What’s your best-selling product, or the product you make the most margins on? Could you add a service to it?
- Add products to services.
Be like the tailor who offers dry cleaning for any major alterations. Or the massage therapist that sells body lotion and other spa products. Or the restaurant that sells baked goods to other restaurants, nearby hotels or caterers or business events.
- Add complementary products.
For example: A local bakery sells party cakes. They know people stop by to pick up a cake fast for a party, and that the people throwing the party are often doing it last-minute. So the bakery starts selling other party supplies. Like decorations, cards, gift bags and utensils, plates and napkins. Now every time someone comes in to pick up a cake, the bakery makes double the revenue.
3. Get more customer referrals.
Study after study has shown that word of mouth is the most effective marketing tactic for small businesses.
And getting more word of mouth business – more referrals – is easy. You ask for them. Don’t be pushy about it, but have the confidence to ask in a laid-back way. Especially when customers are happy.
Hint: You need to be running a good business for the referral engine to work. If you’re not quite referral-worthy yet, see tip #4.
4. Deliver a better experience.
Do your customers like doing business with you, or are they always on the lookout for an alternative?
It’s a tough question to ask. But it can be highly profitable.
You see, happier customers spend more. Happy customers also refer new customers.
5. Partner with another business or non-profit.
As I’ve been talking to small business owners over the last year, I’ve noticed an interesting trend. When I ask them what they think is the single best way to get more business, they frequently mention partnerships. One business referring customers to another.
This is a little different than one customer referring people. It’s the 10x version of word of mouth, if you will. But if you can find a complementary business or cause where there’s a natural affinity, you may have just found the best way to grow your business.
6. Consider raising your prices.
If you haven’t raised your prices in the last three years, it’s time to give your business a raise.
The next question usually is “how much”? Here are a few things to consider about that:
- Anything less than 10% isn’t worth having to deliver the news to your customers.
- You want to raise your prices enough that you won’t need or want to raise them again for at least two years.
Once you know how much to raise your prices (say, 15%), the next thing to figure out is how to tell your customers/clients about the raise.
If you’ve got clients, it’s good to give them warning – as much as three months. For customers, one month’s worth of warning is usually enough.
7. Experiment with discounts – especially for first-time customers.
There’s an old saying that someone isn’t a customer until they’ve placed their second order.
Most businesses will get a lot of one-time customers that never return. Depending on your business, the percentage of one-time customers could be higher or lower.
So what could it mean to your business if 20% of your one-time customers went on to place a second, third, even a fourth order? And what could you do to make that happen?
Take the time to figure out what it’s worth to your business for all those one-time customers to become two-time customers (or more). Then take that value – say it’s $20 per customer – and figure out an incentive you could offer.
The incentive should still leave you with some profit. For our $20 example, a store owner could easily offer something worth $5 to get first-time customers to come back. That $5 per discount could net out to $25 in new revenue for each customer… or more.
8. Upgrade your inventory management.
What’s the biggest asset your business has? If you’re like most small businesses, it’s your inventory. And yet, small business inventories are often mismanaged: 43% of small businesses do not track their inventory, or they use a manual process like pen and paper.
Ongoing issues with your inventory mean that parts and products aren’t available when customers want them. That costs you sales, costs you customers, or (even in the best scenario) means you’ll have to manage backorders, which take up employee’ time and make customers wait.
This doesn’t have to be “just the way things are.” Better inventory systems are available, and they typically pay for themselves – fast.
A well-managed inventory just makes your business run faster and more efficiently. That takes the brake off all those orders you were losing before, makes customers happier, and lets you make more sales.
Better inventory management will increase your profits, too. All that missing or overstocked inventory is expensive. According to Entrepreneur magazine, “Companies can increase their profitability 20 to 50 percent or more through careful inventory management.”
Back to you.
Got any of your own suggestions for increasing revenue? Leave a comment below.
Brain Sutter serves as Wasp Barcode Technologies’ director of marketing, where he sets the strategic direction and oversees the tactical execution of the company’s marketing programs.