Key Ways That Businesses Can Improve Profitability During Uncertain Times
Over the last several years, businesses have faced numerous challenges and uncertain times. First, there was the pandemic that swept across the globe and closed or curtailed numerous market segments, from travel and hospitality to the restaurant industry.
Author:Liam EvansReviewer:Habiba AshtonOct 01, 202299 Shares1.7K Views
Over the last several years, businesses have faced numerous challenges and uncertain times. First, there was the pandemic that swept across the globe and closed or curtailed numerous market segments, from travel and hospitality to the restaurant industry. Stay at home orders crippled some aspects of manufacturing and there were major issues that disrupted the entire concept of just in time supply chain logistics. As the daily effects of the pandemic began to decrease, businesses breathed a sigh of relief. The economy picked up but employers soon found their employees were resigning in search of better jobsand a better life. When things began to reach equilibrium from that change, inflation began skyrocketing and companies in all segments began grappling with soaring costs. With the constant uncertainty, businesses everywhere now know that they need to carefully manage their money and improve their profitability in order to survive and thrive.
Thoroughly Analyze Your Profitability by Market Segment
Many companies are not fully aware of what their profitability is by specific market segment. Rather than performing an in-depth analysis, they often rely on assumptions and business as usual ideas about who they should sell to and in what form. An example from a leading California winery perfectly illustrates this point. The winery created a data warehouse and ran an analysis looking at their mix of product sales. As a leading bottler of fine wines, they assumed that bottling for private label sales was a perfect high-end niche. When they did an in-depth analysis, they found that large bottling runs were highly profitable, but runs that produced smaller case lots made little or no money at all. They eliminated that market segment and redirected the wine to profitable lines, and made $1 million per year from that single query alone.
Control Your Fuel Costs
As energy prices skyrocket due to global demand, insufficient production and recent disruptive world events, companies everywhere are seeing their fuel budgets decimate. In some industry segments, businesses are exhausting their months budget before the year end. Fortunately, you can take a proactive step to help ease these budgetary woes. If your business runs a fleet with trucks, you can use fuel cards to track purchases and set important spending controls. In addition, fleet fuel cardsprovide significant discounts and can help streamline the IFTA reporting process too. You can look online to learn more about how these cards work and find the best options for your existing fleet.
Invest in Profitable New Initiatives
During uncertain financial times, companies can see strong market growth when they invest in profitable new product lines. As other firms are cutting backor curtailing new investments, it creates substantial opportunities for new players to be aggressive. It's worth seeking funding or raising capital for these initiatives. If you are able to introduce creative new product lines into an existing market, you can capture significant market share and set your enterprise up to come out on top. With strategic investing, you will open up new avenues for future growth and profitability.
Liam Evans
Author
Habiba Ashton
Reviewer
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