5 Prescriptions for More Profit in Your Business
* In this issue: Ways to immediately impact your bottom line NOW!
* Less than 303 words, a two minute read.
Greetings from Nashville,
We just concluded the ProSource Summit and have 29 companies participating in the BRAVAS Summit. What a high powered experience!
We have spent hours this weekend sharing the good news of 60-30-10 profit math. Yes, the way to get to 20% b
bottom line in the CI business.
But let's make it short work for you. Here are 5 scripts for moving the profit dial up.
1. Charge for miscellaneous install parts at 7% or more. This is instant profit and to get to 60% + margin on those pesty hard to count and keep track of parts, you need to be at this level.
2. Increase labor productivity by charging for every hour worked and then some. You can charge 9 hours for every 8 your pay if you are diligent on covering all the 8 hour a day hours and beating the fixed bid estimate. By the way you are taking all the risk on the over hours.
3. Make sure every proposal going out the door has a minimum of 30% labor revenue. 35% is better. Apply this on every project over $12,000.
4. Minimize the impact of major operating costs which are typically fixed by increasing your sales volume. Interesting that #1 and #3 do that without finding a new client.
5. While this one is not mandatory, if Margin and Major costs are well under-control, you will need to keep total compensation pay and benefits at or below 30% of Revenue. If you can not, you will need to add a corresponding percentage improvement to Margin or reduced Major Costs to keep the 60-30-10 alive.
Each of these helps you. Each is in your control. Take them one at a time and you will get there.
Good luck and great success in fine tuning your business.