The Secrets of Improving Your Profit While Maintaining Your Sale Price
Have you ever struggled with how to increase your profits and stay competitive in today’s market?
Wouldn’t it be great to find a way to decrease your costs (Production, Selling and Administrative) and grow your bottom line without raising prices and losing customers in the process?
The solution may not be as elusive as you are thinking. Focus and align on the Big Picture as opposed to optimizing the one piece that is under your influence as the later will result in suboptimal flow through your value stream. Liken it to working on the nozzle end of the hose when there is a kink in the line. No matter how much effort you put into maximizing the flow from the nozzle, you will not realize the benefits until you address the immediate bottleneck.
Taking the time to map out your entire end to end flow of material and information, commonly referred to as your value stream, can allow everyone to get on the same page. Once you have mapped things out invite input from your entire organization on where the “kinks” or pain points are and prioritize actions.
Following a methodical approach can seem overwhelming to some and even unnecessary to others yet if you truly want to sustain your gains, it is a necessary step. Start with the end in mind and reach out if you would like to discuss further.
This is an excellent point and something I’ve found many businesses I’ve worked in tend to skip over – not embracing that productivity and avoidance are strong themes to also increase profit as a robust option. In a sales dominant environment, it is too easy to focus on just more sales to increase revenue and relate this to bottom line profit – an obvious easy win some may say. And within a business without the right setup and expertise, that neglect may impact its operational health – yes as you put it, it is growth but not overall big picture growth since without that philosophy in mind, a poorly setup business which doesn’t appreciate end-to-end oversight could mean people and infrastructure would just expand to align with said increase of output, an ever-vicious cycle at a time when resources and energy are becoming ever more costly. Thank you for posting these definitions too, will be very handy to refer back to.