There are currently 30.2 million small businesses operating in the US, accounting for 44% of all economic activity in the country. Your business is vital to the economy and growing it is essential if you want to thrive in a competitive marketplace. But how can you increase profits?
Luckily, the online marketplace has provided a wealth of opportunities to do this. Read on as we discuss how to increase revenue with your business.
1. Focus on Retention
Instead of looking for new customers to drive increased profit, try to retain older ones. It can be easier to up or cross-sell to them as you already have their loyalty. This means they are more likely to spend extra money on your products or services.
You can do this in several ways. Special offers, discounts, and even limited-time offers like free shipping can bring people back to you.
If you have an email list, you could suggest products they like based on previous purchase history. AI chatbots are available to do this for you automatically.
Another idea is to leverage their loyalty to bring more customers in. Give them a referral scheme, that rewards them if they get others to use your business.
2. Offer Delayed Payments
Delayed payments are a good way to stimulate revenue growth. They allow people to access big-ticket items they may not normally be able to afford. This technique works well for younger adult customers who may not have the disposable income to buy large items yet.
They work by enticing customers with smaller monthly amounts which are then paid back in installments. It is good for a business as they have recurring revenue and with added interest can make extra profit.
Paying in installments is nothing new, but how they operate has changed. People are more tuned into higher interest rates and fees than they used to be. Consider having low rates or even make items interest-free.
3. Extend Your Geographic Area
As a business, you should begin your marketing in the immediate vicinity. However, when it is time to expand don’t assume that others areas around this are being marketed to by competitors. When doing some research, you may be able to find a gap in the market.
Once you find these new areas you can think about how best to serve them. It could involve opening a physical store, or you may just start a marketing campaign and offer delivery to the new area.
4. Refine Your Pricing
Pricing is the biggest influence on a customer’s decision to purchase. You want it low enough to entice them but high enough so you can make a profit. Part of this is reading the market and your competitors.
Check to see what other products on the market are being sold for. If they are at a higher amount, then consider raising your prices gradually to bring them into line. Sudden increases will boost profit but could scare some customers to go elsewhere.
5. Freshen up Your Marketing
As a business owner, it is likely that you already have a marketing plan in place. Yet one of the most important revenue growth strategies is to try new approaches or begin to mix it up a little.
The ways you can do this are vast and could fill a whole article themselves. You may try new pay-per-click campaigns, open up to new social media channels or begin creating extra content for use on the web.
Don’t forget traditional marketing methods either. Flyers, billboards, tradeshows, and going into the local community can be just as effective as digital methods.
6. Bundle Products
Bundling products is the process of offering other items that complement the one being purchased or add to it. Major online retailers do this when they suggest items other customers bought at the same time. It is a form of upselling that helps sell more goods.
For example, if you are selling gaming chairs, you may also offer controllers, charging stations, and cables. By adding a small discount, it entices people to buy a lot of products in one go. As the discount only works out as a small percentage of each item, you still make a healthy profit.
7. Offer Discounts
One of the most common business strategies to increase revenue is to offer discounts. Customers love to know they are getting money off and are receiving special deals. There are several ways they can be offered.
Consider setting up a system whereby you provide coupons and discounts for new products. This allows people to try new lines, generating loyalty further down the line. Rebates are a good way to entice people as they are very seldom cashed in, meaning you often don’t have to pay out on the discount at all.
8. Reevaluate Shipping
Shipping can be a minefield when it comes to your profits. You need to remain competitive, yet any offers of free and discount shipping can cut into your profits. If you do offer free shipping, then you could add a shipping charge instead of increasing the price of your items.
If you already have shipping charges, you could consider doing the opposite. Offer reduced or free shipping, even on certain items, for a limited time.
Planning to Increase Revenue
Now you know how to increase revenue, you can formulate a plan. Not all of these will work, as some are business-specific. However, introducing one or two gradually will have a marked increase.
Bennet Financials work hard to make sure you keep more of your money. Providing everything from tax planning to bookkeeping, we can organize your business finances. Visit us here to book a free consultation with one of our experts.