How To Do Your Revenues In One Year

Anand Srinivasan

October 30, 2017

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Earlier this year, a New Jersey based banking organization surveyed over 550 small businesses to understand the biggest challenges they faced. Not surprisingly, three out of the top four challenges had to do with money. The small business owners surveyed for the report cited rising interest rates, healthcare costs and the local economy as top challenges they faced. The answer to these challenges is quite straightforward - increasing your revenues and improving your margins at the same time can dramatically improve your working capital and cash flow that can go a long way in easing your financial concerns. In this article, we will teach you how to do this in a short span of time.

Cut down on your SKUs

Operational expenses increase with the number of different SKUs in your inventory list. This is because each time you add a new SKU to your list, you will need to allocate extra resources to handle these products. This may include segmenting your warehouse to house these new products, and also a separate budget to market these products to customers. This leads to an increase in stocking costs and also higher wastage (especially if you sell consumables). A quick way to improve your working capital is by cutting down on the number of SKUs in your inventory. Doing this not only optimizes your warehousing real estate (by only stocking products that sell), but also optimizes your marketing budget and makes demand planning easier. Most importantly, cutting down on SKUs makes sure that you don’t waste time pushing products that customers don’t want.

The 10% strategy

Doubling your revenues do not have to come with big-bang marketing strategies. According to Jacqueline Biggs, the author of the book, “Marketing To Win - How Small Businesses Can Do More With Less”, small businesses should look at making incremental improvements to their various key metrics like the number of customers, average order size, purchasing frequency and conversion. Increasing these key metrics by a humble 10% each could have a dramatic impact on the overall revenues of your business.

Acquisitions

There are two ways to grow your business. The most popular strategy is to spend money on marketing and wait for your investment to bear fruit over the long term. While this presents a sustainable model of growth, there is also a risk element to this. Not all marketing strategies prove to be successful and if you are investing in organic models like SEO, there is a chance that you do not realize the futility of your investment until it’s too late. An alternate strategy is to invest this budget in acquiring businesses that are already successful. Unlike marketing, acquisitions need businesses to pay upfront. However, the returns from such an acquisition can be realized immediately and this can help businesses realize their objective of doubling revenues faster.

Increase your sales channels

Increasing the number of sales channels can bring about a proportional rise in revenues. For instance, a business that runs an offline apparel store can see higher revenues if their garments were also made available online. A retail store could increase their revenues by opening a vending machine that can make money even when your store is closed at night. An affiliate marketing strategy can help you hire a large sales force that earns a commission every time they sell your product to a customer. There are dozens of such innovative strategies that can double your revenues in a very short period of time. But like we already mentioned earlier in this article, it is important to measure the effectiveness of each of your strategies to make sure that you only invest in channels that are profitable.

Doubling your revenues within a year can seem like an improbable task. But when you break down your sales numbers, you might realize that it is just a matter of tweaking your current strategies and optimizing your resources. Do you have any other strategy that can help double your revenues in a short period? Share them in the comments.