5 Questions for Making your Business More Profitable
So you’re looking for ways to make your product line more profitable? Perhaps you want to grow your business by introducing a new product line or perhaps you want to look for hidden opportunities that you’ve already got. This exercise will help you identify where you’ve got an opportunity to make your product offering not only more profitable but more varied too, and if you’re someone who likes to have variety in their work, that’s an added bonus.
This is a super practical post, so you’re going to need a notebook or your journal. Take your top 1 or 2 best selling products or services and go through the exercises below.
First up, is the price right?
This is the first point of call before you consider introducing any new products or changes. If you haven’t put your prices up within the last year or if you’re struggling to keep up with enquiries, put those prices up. Even if it’s just a 5% increase it will all help towards improving the profit you generate in your business.
How could you sell it at a quarter of the cost?
How can you make your product more accessible and available to a wider range of people at a lower price point? For example if you sell a branding package for £1,000, could you sell an intensive call to help people out who are doing their own branding for £250? Or could you create an ebook taking people through your branding process so that they can get started with creating their own branding for £30?
If you’re a maker, perhaps you knit jumpers, could you sell the pattern and some wool as a kit for a fraction of the cost?
How could you sell it at double the cost or even ten times the cost?
You get the gist now but I’ll offer up another couple of examples. Say you’re a wedding photographer and your standard package is £1,500, could you offer an add on where you do an engagement shoot and you stay later on into the night to capture those dance floor antics for double your standard price? Or perhaps If your best seller is an embroidered cushion that sells for £35, perhaps you could teach an embroidery class to 6 people at £60 per person equals £350
What new income streams could you add?
As well as diversifying the products you already offer you also have the option to introduce new income streams to your business. Have you considered teaching your craft or sharing some of your expertise as an ebook or online course?
What can you ditch?
Ever heard of a not-to-do list? Think about which products or services you need to ditch. Go back to your numbers, which products are least profitable or really draining to create? Simply by not producing products that don't have a healthy profit margin or aren't feeding your creativity will free up some of your time and energy to do the work you really love and focus on making that profitable.
Making your business more profitable isn’t about doing more, more, more, it’s about finding new ways of doing things and introducing new income streams, products and services that fit with your strengths. Remember that you started your business so that you could do more of the work you love, so as a final point to add to the question above, make sure that any new products or any changes you introduce fit with your why, your values and most importantly the work you love doing.