The conventional methods of selling and earning good margins has completely changed. Buyer behaviours have changed and more choices are now easily available. The key question is, how can you increase revenues and profits during these disruptive times?
Boohoo, an online fashion retailer posted a 97% increase in profits and growth in sales by 51% in the past year. On the other hand, Next, a fashion chain posted a drop of 2.5% in total sales in 13 weeks. The point I am trying to make is, what is a successful growing company doing compared to another in the same industry which posted unfavourable results? Though Next has retail outlets as well as an online presence.
There is a common trend for companies that are successful. They focus and act on certain activities which struggling companies are inconsistent with. I filtered out 7 insights which have made a positive impact to businesses which are key to their progression over the years. These are:
1) Asking the right questions: Knowledge is getting the right answers. Intelligence is asking the right questions. In order to succeed in these challenging times, successful companies keep asking incisive questions. Often, I note with concern that the executive and operational teams in struggling companies do not ask enough questions resulting in lower revenues and profits. Leaders must ask questions pertinent to growth in revenues and profits.
2) Focusing on what is working and changing: A big turning point is to ascertain the leverage points of your company. Deep attention is needed to find out what territories, products, segments are making the biggest impact. Equally important is to ascertain which products or services are in demand and which ones are slipping. Establishing as to the reasons for certain falls in revenues at an early stage will help you get on a firmer platform for growth in revenues and profits. It is also important to note that picking up these signals earlier will save you from financial adversities.
3) Sharpening competence at all levels: whether you head a division or simply support operations, you need to sharpen your skills. This means you need to equip yourself with the right strategies and tools. Say you are in the garment manufacturing industry selling to wholesales as well as have a retail outlet. You will need to have financial literacy which will include picking up financial signals. Further, you need to ensure that you and your team optimise on utilising their time more productively. This can only happen, if certain tasks are delegated and more time is freed to look beyond the horizon. It will further free up time to take up more value driven activities and develop skills accordingly.
4) Simplify and clarity: Basic as it may sound, simplicity and clarity are two core ingredients to your growth. Whatever you offer for sale, must be simplified and must be clearly understood by all concerned parties. These would include your sales and marketing team, senior executives as well as existing and potential buyers. Secondly, all levels of internal communications should be clear and there must be clear accountability at all levels.
5) I.T: Digital disruption has transformed the way businesses are run. If you do not have digital presence, you are most likely to be obsolete in the next few years. Depending on your business, you need to have ecommerce facilities. A simple shopping cart and relevant secured checkouts is necessary. Further, you need to have social media presence. Regular updates and engagement is essential. We must note that sound I.T systems can result in leaner efficiency which will help increase profits. Having systems and automating certain processes will lead to higher efficiency levels.
6) Adding Value: Having a pure intention to add value shifts the company on a firmer ground. During this age of information overload, you need to stand out. Value can come in various forms. Adding value by offering information is common for all industries and sectors. You can also add value by exceeding customer expectations. Recently, I wanted my car serviced and decided to go with another garage which was equally reputed. They offered to pick up my car from my place and delivered back after service plus wash and valet the car at no added cost. I had not experienced such a service in the past and I immediately referred my close friends and family members. To stand apart, your potential customers and clients need to gain trust. Giving away genuine value without holding too much back, helps you position your brand further. There are many companies, large and small who keep sharing valuable insights on social platforms globally.
7) Leadership Pipeline: No growth in revenues and profits is complete without having the right people who will support you. These include your staff as well as other service providers supporting the value chain. This by far is the biggest turning point I have noted as a strong touchpoint for organisations. There must be a clear distinction in duties and a sense of ownership throughout the organisation.
While these points are not exhaustive, they will help you in increasing your profits and revenues in uncertain times. The key is to ensure that certain habits are changed in the process and more attention is given to the external trends and changes taking place globally. If you do have further insights to share in increasing profits and revenues, please share.
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