Target High-End Customers
The reason many small business owners fail is that their clientele is mostly comprised of lower-end customers. The business owners, therefore, concentrate all their efforts on marketing their low priced items to pull in more customers to their businesses. This, however, does not give them the high-profit margins that they are looking for. They should focus their efforts on marketing their products to the high-end clientele instead, who will buy more expensive products that have higher profit margins. The lower profit products should be there as an alternative for those customers who cannot afford the expensive products.
Change Operating Procedures
To maximize profits, you need to increase sales while reducing costs. To increase sales, you need to offer products that compliment your current set of products. For example, offer free delivery services for any large purchases to entice customers to make larger purchases. Offer a relationship-based sales that will attract customers to keep coming back to your establishment by offering service plans, monthly and yearly, with discounts for a longer service plan. Also, offer discounts for bundle purchases and visits and exclusive deals for new customers.
Accommodate Several Payment Plans
Some businesses may have low returns and profit margins because they only incorporate one payment method for their products, like cash. To increase sales, include several payment plans, like cash, credit cards, electronic payments, and mobile money payments. This variety of payment modes will entice more customers since they have numerous ways with which they can pay. This will also entice high-end customers who may not prefer to pay via cash but instead prefer paying by credit cards. The extra charges on card payment and mobile money transaction fees will also add to your profit margin. For those establishments that would like to establish a credit card payment system, The Southern Institute can help them get the system at lower processing costs.
Reevaluate Your Prices
Many customers sift through numerous prices offered by different companies for various products before settling for a purchase. For better sales, consider revising your rates such that they offer competition for your rivals, offering relatively lower prices for your products, which will pull in more customers. Also, offering additional post-sale services for your customers like free delivery and installation will give you a larger clientele. Offering a faster delivery for your products will also give you more customers while giving you an opportunity to charge a higher price for the faster delivery. Another technique to push sales is to redesign the packaging for your products. Products with a higher aesthetic appeal will entice more customers, thus increasing sales and a higher profit margin. Bundling complementary products together will also help you make more sales at a higher price. For example, instead of selling bread and margarine separately, sell them as a bundle, which will give the customers no alternative but to buy both products.
