Improve Bottom Line Profitability (Part 2) by Robert Finkelstein

profit Hopefully I’ve got your mind thinking, “Sell, Sell, Sell…and Save, Save, Save!” Celebrate all the great sales, but keep that bottom line in plain sight. If ever it gets obstructed, good luck staying profitable.

So let’s continue with more cost-cutting tips.

4. Networking. Never underestimate its power. NetworkingFace-to-face marketing/networking beats traditional paid advertising…if for nothing else, it can be free. If you can create good rapport with potential buyers, you’re leaps and bounds ahead of trying to convince someone through an impersonal ad. Find out where to go…and go there. Don’t forget about social networking via the Internet. The only cost here is time…but it can be very effective.

5. Receivables. Simple math here. If you have to pay your vendors before your vendors have to pay you, you’re going to have serious cash flow problems. When I worked for a distributor, we had to pay our manufacturer net-30 (basically, 30 days after receiving the product.) Our big box retails clients paid us net-90. My six-year-old son can tell you that won’t. You must negotiate terms that are mutually beneficial. If you can’t, then you need to evaluate why doing that business makes sense. Sometimes it does, but only you can determine what works best for your company.

6. Mileage. Instead of a car allowance or a company car, reimburse employees for mileage. For example, here in California, the current reimbursement rate is $0.55/mile. This can add up, so again, you’ll have to determine what’s best for your company. If you are tempted to go the mileage reimbursement route, you’ll save on insurance, and maintenance, among other unexpected costs.

At this rate, you’ll be buying a larger piggy bank in no time.

If you have any questions or comments,
please write them below or email me at Robert@RobertFinkelstein.com.

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