How to Redesign a Business to Improve the Bottom Line

The bottom line of the business determines how successful you are in any given quarter and something that needs to be regularly analyzed and improved. Improving the bottom line is a process of working with margins, but there are plenty of areas where you can make changes.  

Key Takeaways: The Bottom Line

• Get your pricing approach right, and clients will be happy to pay more for quality 
• Upgrade your office base with an asphalt patch to impress your clients when visiting
• Make shrewd choices about your time and consider minute instead of hourly rates
• Hire and retain the right personnel and partner with fewer vendors to boost business

Rethink Pricing 

Pricing is a tricky part of any business, and it’s one of the most important elements to get right. In a competitive marketplace, many businesses adopt a price-matching strategy that kick-starts a race to the bottom. It can seem like a smart idea for some, but it’s not great for the bottom line. 

If you want to provide clients with the best service and improve your bottom line, it’s better to have a frank conversation with them about your pricing. Explain to clients that you are not the cheapest on the market and tell them why. Notice that clients are happy to pay for more quality. 

Redesign Premises 

In recent years there has been a shift to remote workforces and home offices, which has reduced the reliance on a brick-and-mortar office base. While this setup can save money and improve your bottom line, it can also backfire, especially when it comes to client interactions. 

If you want to impress high-paying clients and land the best contracts, you need somewhere to meet them that is practical and projects your brand in the right light. Make sure your office space highlights the qualities of your business with a brand-new asphalt patch outside of the office.    

How to Redesign a Business to Improve the Bottom Line

Cost of Time 

If you want to improve your bottom line, you need to get stricter about your time costs. Most businesses charge by the hour, but that’s not always the best way to earn revenue. Businesses that charge by the hour tend to round them up and down, but there are always lost minutes. 

In the interests of efficiency and revenue streams, you could switch to charging by the minute and improving your bottom line. Instead of losing out on lost minutes in the hour, you earn a profit on 15-minute increments. It also means your business operates more efficiently overall.  

Tight Estimates 

If your business charges a flat fee for the hours worked, you need to be sure that you have a strong idea of the estimates and how they relate to the general framework in the industry. Inaccurate estimates can cost a business thousands every year in lost revenue and profits. 

To ensure your estimates are tight and reliable, make sure you are billing for the hours worked. To achieve this, you need to monitor your business processes over time, optimize them for best practices, and compare your prices with competitors in the industry, leading to better results.   

Remove Emotion 

Finding the right amount to charge your clients can be a tricky process, especially if you are new to an industry or have some imposter syndrome when it comes to pricing. Setting the right prices for your business is more about attitude coupled with the knowledge of how to set prices. 

A business owner that sets prices from the bottom up, thinking about how much she can make over and above the fee and taxes, will earn less than a business owner that set her prices from the top down, thinking about how much she wants to make to a comfortable life that she wants.   

Reduce Fees 

Businesses of all kinds require funding and financing to maintain an even cash flow and protect the bottom line. In most cases, this additional money comes from credit cards with interest rates and fees. While credit cards can be convenient, they are not always the best way to earn profit. 

If you want to improve your bottom line, you need to start thinking about some alternatives to credit cards; this can include bank loans and funding from investors. Look into cash flow loans from the bank that are designed specifically for the purposes of maintaining the bottom line. 

Client Focus 

Focusing on the clients and resolving their problems directly is the best way to win their business and improve your bottom line through customer retention and word-of-mouth advertising. To achieve these results, you need to put yourself in your client’s position. 

Client focus means understanding the nature of the business and the pain points and then relating those issues to the client along with a workable solution. Win their interest by outlining the very problem they have and win their business by telling them how you can resolve it.  

Vendor Reduction 

In the beginning, you might use a variety of vendors and choose ones that offer the lowest rates, but that’s not always the best way to operate. Vendor variety can give your business a certain mode of variation, but having specific vendors that serve your business is more profitable. 

When you have a pared-down vendor list, it means you can reduce your costs over time with better deals for bulk orders, along with seasonal discounts. Another benefit of having a short list of vendors is the lack of variation and improvement of brand style and image attracting clients.    

Right Personnel 

Make sure you hire the right personnel to improve your business and its bottom line. At first, you might simply need employees to perform a task, but over time you will require more knowledge and skilled workers. Plan your recruitment process carefully and work hard to retain the talent. 

Final Thoughts 

Businesses across the board are interested in improving their bottom line, but when you work with estimate and bottom-up pricing strategies, it’s easy to find yourself in a race to the bottom. 

Using the advice in the article, you can work towards more profits and the lifestyle you want.

How to Redesign a Business to Improve the Bottom Line