Want to make more money? Well, step right up. There are no shortages of articles, systems, podcasts, videos, infomercials, webinars, books, and schemes all designed to show you how to do just that. If it’s not someone sharing the latest and greatest multilevel marketing organization, it’s someone showing you how to quickly buy and flip real estate.
Do some of these ideas work? Sure. But, as you well know by now, if something sounds too good to be true, it usually is. Especially when it comes to business, the hard truth is that there are not many shortcuts. Business success and growth usually takes hard work and persistence. Let me suggest that if you are in business for yourself, there are really only four ways to make more money:
1. Sell more: The bottom line is that you need to sell more of something to make more money. If you are a business owner, you don’t need someone to tell you that or to try and sell you his or her wares: You already have products and services to sell.
So the first trick is to expand the business you already have. There are a couple of ways to do just that:
- Get more customers: Easier said than done, you say? Maybe, but maybe not. They key to getting more traffic in the door is to expose your business to new people. Market more, make more, it is (almost) as simple as that.
- Create a new division of your business: All great businesses figure out new products to sell and new services to offer. GE sells dishwashers yes, but it also sells jet engines and real estate financing. If you want to grow, you need to expand your offerings too.
2. Sell bigger: This can mean two things:
First, you can sell to bigger clients and customers – in other words, those with bigger budgets. For instance, if you primarily sell to consumers and other small businesses, you might find that selling your wares to corporations and government entities will yield bigger revenues.
Second, you can sell products with a bigger profit margin. Even selling the same amount of such products will result in more net income. I love to share the story of the real estate agent who finally figured out that selling commercial buildings was about the same amount of work as selling houses, but that commercial buildings usually had an extra zero at the end of the asking price. The agent did the same work, but made a lot more money.
3. Spend less: The third way to increase your profits is to cut your overhead. If you haven’t done an audit of your business expenses recently, consider doing so now. There are probably many areas where you could cut some costs:
- Office supplies
- Product line
The important thing to keep in mind when cutting your overhead is to do so intelligently. You certainly do not want to cut back too much on those areas that generate revenue – advertising, for example.
4. Invest: Of course, investing is always a smart individual wealth-building strategy, but in this case, I am talking about investing in your business.
When I was younger, I would see a business going through, say, a big remodel and I would always wonder why the owner would undertake such an expense when it did not seemingly affect the bottom line.
Except that it did of course.
By investing in your business, be it remodeling the premises, paying off debt or buying new equipment, you increase its equity value. Eventually, that equity will become even more valuable down the road.
So there you have it. If you want to make more money from your business, you’ll have to do it, in the words of the famous commercial, “The old fashioned way: You will have to earn it.”
About Steve Strauss
Steven D. Strauss is one of the world's leading experts on small business and is a lawyer, writer, and speaker. The senior small business columnist for USA Today, his Ask an Expert column is one of the most highly-syndicated business columns in the country. He is the best-selling author of 17 books, including his latest,The Small Business Bible, now out in a completely updated third edition. You can listen to his weekly podcast, Small Business Success, visit his new website TheSelfEmployed, and follow him on Twitter. © Steven D. Strauss.