Five hidden revenue sources for your small business
March 13, 2017
When it comes to running a small business every dollar counts, and it’s up to the leadership of that business to be excellent stewards of their revenues. Over the years I’ve found five hidden sources of money savings, which of course means a better bottom line, more profits, and happier owners. Be sure you’re engaging in these strategies to get the most out of each revenue dollar.
Ride your vendors
Your vendors will increase prices or decrease quantity sizes and see if you notice. Once they see that you aren’t monitoring these things, they feel free to let the numbers slowly creep in their favor. It’s not their job to get you the very best deal — it’s yours! We find that one of the best strategies to keep our prices competitive is to do vendor reviews twice a year. This is when we invite other vendors to bid for our account, which gives us leverage and keeps our vendors honest.
Check in your orders
When you receive product, check it in! Go over the invoice with the delivery driver and inspect the delivery. Often times you’ll find damaged goods, extra charges, and unordered items hidden in your deliveries.
In my industry, the restaurant business, doing inventory weekly is ideal. This helps keep your honest staff honest and make sure things aren’t walking out the back door, or getting over-ordered and stockpiled. What’s wrong with stockpiling? Firstly, it gives the perception to the staff that they can be wasteful with your product and there will always be more to use. Secondly, when you have extra stuff on your shelves it represents money that’s not in your bank account. Never spend more than you have to.
Don’t have your entire staff start at the same time. Stagger out your workers to increase as your volume increases and cut them early as it decreases. It might seem small but even pushing one start time by 15 minutes for one associate five days a week totals 65 hours of extra time for the year. That’s around $1,000 dollars you don’t necessarily have to be spending and you can imagine how that compounds if you do it more aggressively.
Renegotiate your lease
Talk to your landlord as frequently as you can and make sure your lease makes sense for your business. For our industry — and most — your lease payment should be around 8% of your revenue. For prime locations it may be higher, but make sure the volume is there to adjust. Also, if a big anchor moves out of your center or you’re not getting services that you should, speak up and see if your landlord can do anything to help. Remember, the answer is always no unless you ask.
These are just some of the ways we’ve worked to stretch our revenues and maximize our profits. Plus, all of these things are just smart business. Do you have any secret sources of income in your business? Leave a comment and let us know!