I know a lot of people think increasing profits without chasing sales is a gimmick, scam or just plain impossible.
Let me assure you, it IS possible – and probably easier than you thought!
As entrepreneurs we have a tendency to think the way to solve our problems is to throw money at them. But when your cash flow is your problem, that’s never going to work.
What happens when we increase our revenue from chasing more sales?
- We gain more clients
- We get more work
- We stress the heck out
If you’re adding more to your already hectic schedule, things can quickly spiral out of control.
In fact, I already talked about the problems with a broken financial system, and how increasing revenue isn’t the fix.
I want to talk you through a simple roadmap to significantly increase your profits without having to increase your revenue, stress levels or workload.
Increase your profits, keep your revenue steady
I promise you, it is completely possible to make more money without having to work harder.
Work smarter, not harder, right?
I’ve talked before about my experience with entrepreneurial poverty, and how throwing more money at my problems just caused me a whole lot of headaches.
You can’t keep bleeding yourself dry trying to bring in more, more, more.
At some point, you have to sit down and ask “How can I make the revenue I AM creating work for me?”
Dial in to your finances. See where your revenue is being spent each month. Then you absolutely can increase your profits with ease.
My Roadmap to Increasing Profits
There are 5 steps I want to talk you through in this blog post to really make your money pay its dues:
- Set Financial Goals
- Gather Your Data
- Audit Recurring Expenses
- Track Your Variables
- Implement the Plan!
It might seem a bit of extra work now. But I promise if you do these steps, Future You will be so much happier!
Step One: Set Financial Goals
Audits can be scary, but I want you to know that they can be simple when you break them down. The first stage here is to decide what you want to achieve from auditing your finances.
Do you want to reduce your expenses by a certain amount? Or do you want to keep your expenses within a certain budget.
There’s no correct option – choose the one that feels best for you to increase your profits.
Step Two: Gather your Financial Data
There’s no way to make a profit without knowing what your numbers are telling you.
Pull your business account statements for the past 3 months to get a good overview of your spending.
This isn’t just your bank account – if you use credit cards or PayPal for your expenses, pull those too!
Get all the paperwork in front of you, ready to start finding those extra profits!
Download my free Profit Plan, and you might want a strong coffee for the next part, too…
Step Three: Audit Recurring Expenses.
Recurring expenses are the things you pay out every month for your biz.
They could be:
- Membership Subscriptions
- Software Services
- Social Media Manager fees
- Bookkeeper wages, etc.
Input every recurring expense into a spreadsheet under the following categories: Needs, Wants and Got to Go’s. Marie Kondo the heck out of your expenses! Identify the expenses that bring you joy, and Got To Go the ones that don’t.
Breakdown your spending into:
- the things that you absolutely need to run your business
- the things that you want in your biz because they bring you joy
- the things that have got to go because they are not making your life easier
My favourite thing about performing a recurring expense audit is that you will immediately find things you can cut out. This means MORE PROFIT IN YOUR BUSINESS!
Step Four: Track your Variable Expenses
These are the payments that don’t happen every month. The every-now-and-then payments that sometimes can’t be avoided.
Maybe your printer ran out of ink, or your ring light broke. You’ve had to replace them but this isn’t a recurring expense.
Take a close look at your one-time expenses and see whether there’s a pattern. Are you regularly spending $300 on office supplies per month? Let’s see if we can cut that down.
Avoid ‘Shiny Object Syndrome’, set a strict budget for variable expenses each month – and stick to it! Getting a grip on your one-time expenses is going to make managing your finances and increasing your profits a lot easier.
The great thing about auditing is that Knowledge is Power. Once you identify your spending patterns, the answers are going to jump off the page at you. It will become obvious where you can cut back on spending. And that’s when the profits come rolling in!
Step Five: Implement the Plan!
Understanding how to increase your profits is great. But unless you actually do something about it, nothing will change.
I want you to schedule the following blocks of time into your calendar:
- Time to pull 3 months’ worth of financial reports
- Time to audit your expenses
- Time to complete your action items
Do these things, take this time now, and see how quickly you start increasing your profits. Without a single extra sale in sight!
If you want to see me talk through the steps with visual examples, then check out my YouTube video. I am so keen for you to take the time to do this audit. I would LOVE to see how many of you start increasing your profits!
If you’ve got my free Profit Plan and gone through the steps, please message or comment. I really want to know how it turned out for you!
Check out my website to learn more!