Jul 28
Small Business Profitability
In this day and age we all seem to be obsessed about getting more clients to increase income through more sales of our products and/or services. I agree this is vitally important but now that we are in an economic downturn then is it realistic for us to get more new clients and for existing clients to spend more with us when they are struggling to keep up with their mortgage payments, rising food bills, rising utility costs and soaring petrol prices? Never mind the cost of diesel now in the UK – yeah why is diesel so much more expensive than petrol? It always used to be cheaper?!?
Anyway I digress..But if anyone does know then I would be delighted to hear from them!.. So this brings me to other ways to protect our business and maintain profitability.
I say lets look at our overheads. I know this is tedious and boring but just bear with me on this one for a few moments. OK let’s say you are running a second hand car dealership and your average price for a car is £8,000. Your profit margin on this is 10%. So this means you make £800 on the sale of that car….and given the current climate you would be chuffed to sell one this week! Well how about you turn that around and look to save £800 on your utility costs? That’s one car sale! So how do you go about this? Well of course you can do some web searching for the best quote. Then you should look at what is consuming the most energy. There are all sorts of gadgets and gizmos now available to help you do this. Then you look to turn off anything that isn’t being used. Again there are gadgets that will do this automatically for you. And finally you should look to install low energy lighting. Yes even your fluorescent tubes can be low energy and they are no longer like the early low energy light bulbs which were quite “dim”. Now the level of light given off is virtually identical. Plus the other big benefit is that you have helped save our planet and reduced your carbon footprint! So a true win-win situation.
You may also like to know that The Carbon Trust has interest free unsecured loans for small businesses trading for 12 months or more to upgrade to energy efficient equipment and reduce their energy use. £5,000 – £100,000 unsecured, interest free, repayable over four years. (There is £35 million in the pot!)
So why not start right now and look at reducing your energy costs. It could be as rewarding as a new sale!
You might also enjoy this....
2 comments2 Comments so far
Leave a comment
Have you any recommendations on how to reduce fuel costs in a socially sustainable way Mr Stanford? What are your views on nuclear fuel? I believe this is the way to reduce the impact global warming – however unpopular it might seem …
Thank you Julie for your comments. Well I do have my opinions regarding nuclear fuel and I am personally as yet unconvinced that the risk/reward is worth it. I don’t believe we know enough about the long term effects of disposing the waste from producing nuclear energy. So I think that until we are 100% certain then it would be irresponsible of us to leave our future generations with a potential environmental disaster to resolve that was not of their own making. I am however very excited in recent innovations regarding the production of “fuel” from algae. I believe the term is “algoils”. From what I have heard so far these seem like a viable alternative to oil and nuclear and have a beneficial impact on our environment.