- Do you wanna increase the profits in your business?
Well if you do you've come to the right place
because in this video I'm gonna show you
how you can increase the profits in your business
by saving money in your business.
Okay gang let's get into it.
Tip number one is producing a monthly profit and loss.
This is the bedrock for building a fantastic business.
And here's the reality of it businesses produce
annual sets of accounts.
They have to produce annual sets of accounts
by law because they know what tax they've gotta pay.
But actually the real foundation of success in a business,
from my point of view, is making sure that you're producing
a monthly set of accounts so you know that if your business
made a profit or loss or if it's broke even
on a monthly basis.
And by looking at that you can see the actual expenditure
that you're spending on a monthly basis.
Now with great systems like Sage, Quickbooks and Zero
you can do this stuff but you need to understand it.
Don't just print it off.
You need to understand it.
You need to read it like a language and know where
the numbers are so that you can focus on that expenditure
to turn those bad months into much better months.
Let's look at tip number two.
Tip number two is making sure that your sales
happen before those expensive operations.
Now the reality is guys as entrepreneurs
we wanna put in the best customer service,
the best operations in for our customers
so that the sales quickly follow
but that is just not the real world.
You wanna be focusing on getting as many sales
into your business then quickly putting
in that customer service, that operations in
as fast as you can.
But never let those expensive overheads,
those expensive operations, get in the way
of getting as much income into the business as possible.
So tip number two is make sure you focus on sales
before the expensive operations come in
because that is one way of killing all the profit
in your business.
Let's go on to tip number three.
Tip number three is making sure that you focus
on your supply chain.
I guarantee you that there is somewhere in your business
where you could buy stuff better, more efficient,
and cheaper but the same products or service
and that's where I've been focusing our business.
We import from India, we import from China.
We buy all of our uniforms that our staff wear,
we buy that from India.
We buy millions of pounds worth of product
from the far east in China because it's cheaper
than buying it in the UK.
But here's the news that's really fantastic
for entrepreneurs.
Nowadays you don't have to buy in the bulk amounts
that you used to buy 10, 20 years ago.
The world's gotten smaller place so how do you look
like going overseas to bring stuff into your business?
Your competitors are doing this, I guarantee you.
So make sure you're looking overseas to really dramatically
bring down the cost of what you import into your business
in terms of products and services
and see if that can save you money.
I have saved literally hundreds of thousands of pounds
by buying outside of the UK and it's not
as much as you might think.
Do some research on it from this website
that begins in G and ends in oogle.
Tip number four is bringing products and services in house.
Now the reality is when you're growing a business
you tend to outsource stuff and get other people to do it.
This is expensive that they're charging you
an hourly rate and putting a margin on it.
That's their business.
As soon as you can, I've always found this,
bringing stuff in house means you do more,
it means you're more efficient because you can do more
and it means you get stuff done quicker
rather than waiting for a third party
service provider to do it for you.
So as soon as you can bring products and services in house.
That's what I've done.
In my opinion it's the best thing to do for entrepreneurs,
maybe not for big business because they can get
smaller businesses to do the things quicker
but if you're an entrepreneur and you wanna get
more stuff done bring it in house, it will save you money.
Second opinion's getting an outside view
on the numbers in your business.
One of the smartest things business owners can do
is employ the use of an outside consultant
to go over the numbers in your business
and see if they can save you any money.
Sometimes people call this outside procurement.
So an outside procurement company will go through all
of your numbers if you're a big business and say
hey if you go to this company, that company,
this company they'll save you some money.
But a business owner doing this, a business consultant
that's got an understanding of your knowledge
of business, will go, hey, your labor costs
are really expensive compared to that other person
in a similar market industry to you.
Their labor costs are much less.
That is power in growing the profits in your business.
How often are you getting this non-exec director-type person
to come in and audit your business.
I don't mean your accountant.
I do not mean your accountant I mean an existing
smart business consultant, business owner,
another successful entrepreneur that can review
and improve your business.
Make sure you get that outside opinion.
It's been the thing that I've done for other companies
to really catapult their growth and I've had other
business owners come and look at my accounts
when they run similar businesses to me.
So what I always say if you're an estate agent
in Brighton find an estate agent in Birmingham
and compare the numbers in your business.
Those outside eyes looking at your business,
and you've gotta reciprocate it both ways,
will really help grow the profits in your business
because you'll be able to save thousands of pounds.
This process has literally saved me at least a million
pounds over the course of my career by looking
at other people's accounts and them looking at my accounts
to compare where we can save money.
It really does work.
Tip number six is getting rid of those loss making lines
in your business.
As a business grows it usually takes on unnecessary fat
and this can actually be a loss making income stream
lines into your business.
As human beings we're obsessed with growing our stuff
and in business owners, they're turnover,
they don't wanna lose income lines.
Now you can have a loss making income line
if it means that you're making a profitable income
from the customer or service that you're providing
down the road.
For example Google'll do this, they give you
the gift of search for free.
They don't make any money from that
but then there's advertisers that pay
for pay-per-click.
You oughta be looking in your business,
have you got historical income lines in your business
that don't make you any money?
Now I had this.
I had an entertainment agency and we hired our equipment.
It took too much energy and enthusiasm and effort
from us, from our stronger profit-making line.
We cut that business off and then all the other lines
of income started to increase because we had the time,
effort, energy and enthusiasm to put it
to the more stronger profitable-making lines.
It's tough to do this because usually these lines can
be how the businesses started.
It could be the foundations of the business
but the business has moved on but we've kept them going.
Sometimes you need to cut the fat
to really improve going forward.
Tip number seven, this is the controversial one gang
but it's sacking customers.
Most business that I'll have worked with,
that I've consulted with,
will have customers that lose the money.
If you've got customers that lose you money
but they've been there for years sometimes
that awkward conversation needs to be had.
I'm not gonna say anything about this 'cause you know
what you need to do.
Number eight is less lines.
Hey, didn't you used to go to restaurants
in the '80s and '90s, in the early 2000s,
that would bring the menu on a forklift truck
and you'd read it and they'd have everything there.
Restaurants, if you noticed over the years,
have reduced their menus down to having less lines.
This means that they can be more efficient,
drive better margins on the products, buy better, etc,.
How can you do that in your business?
Have you got a too big a menu?
Do people only buy from a few of your lines anyway
and you gotta hold this stuff, you gotta store this stuff,
you gotta stock take this stuff and all of this time
sucks the profit out of your business.
Look for less lines where possible in your business
and usually that does drive the profits up.
Number nine is your quarterly cut.
Here's one of the things that I've always done
in my business.
I have a day where I sit with my MD and my FD
and we'll just go through all of our suppliers
and see if we think that they're overcharging us
and compare it to other suppliers.
We get outside procurement in and we cut
all of the unnecessary fat the business builds up.
Hey, people should be doing this
in their personal life, as well.
How many people have been paying for gym memberships
for months and they're never using it?
Well you imagine this happening on steroids in a business.
How often are you paying for Sky TV subscriptions
and TV subscriptions for all the stuff that you don't need
and you just keep on paying it?
The same happens in businesses.
Businesses, the bigger they get, the more fat they absorb.
So put in your diary a day for doing your quarterly cuts.
This is a really smart thing to do because you'll be
putting down as a system and a process
to save money in your business.
In our business, our quarterly cut, we save at least
50,000 pounds in a day just by going, hey,
we're spending too much money on this,
let's address it, let's do something about it.
One of the smart things to always do is make sure you
sign off all the payments in your business
until your business gets to the stage where you
can't do it because it's so big
but that's one of the things that I always do.
Let's move on to the last tip, tip 10.
We're making this video in 2020 and I think
it's important to say that technology can now
save a lot of money to grow profits in your business.
How can you get technology invested into your business?
It gets cheaper all the time.
Make sure you're focusing on it.
If you're a restaurant, if you're not doing self-serve,
you're mad because you can cut so much labor
in your business and actually customers wanna self-serve.
They go to airports now, they don't wanna queue up
and put all their baggage in.
They wanna go straight through security,
they wanna cut the human interaction out.
People are going into McDonald's and they're ordering
coffees, they're self-serving.
But small businesses, and I'm talking about small businesses
up to a hundred million of revenue, right now
can actually implement this stuff cheaper than ever before.
But this is the thing, right guys, the constant market
is always innovating.
The market is always innovating and if you don't innovate
you're gonna evaporate so look for technology savings
to really grow the profits in your business.
Guys if you love this video then you're gonna love
this other video that I've produced and then you can
get it by clicking here.
This is the six people you need in your business
to grow your profits in your business.
Click it right now and if you've loved this video
comment below, let me know what you think
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and I'll see you real soon.
Bye-bye.
(gentle music)