Putting robust systems in place will raise your profits.
Business is a game of numbers. There is a time to cut costs, but there are also those times when it actually pays to spend money. There are many businesses wondering why success is fleeting, and when we look at their system of operation, we immediately understand why. When a business is using outdated systems and tools, their profit margins can suffer terribly. Some examples may be:
A logistics company that 6 years ago was tops in their area has slipped. The competition has taken many of their customers. Looking at the numbers, management shakes their head in a perplexing way. Prices have not been raised in those 6 years. Everything is run just the same as it was then. The software used shows the pickups, drop-offs, and the locations of their fleet of vehicles. Vehicles are maintained clean and organized, and for the most part, the same staff is employed. They just cannot understand why the business has left for the competition. When we looked at their system, it was a simple answer:
The software used in tracking was the same. New forms of robust software have what this software has, and much more. The new software can tell the best route for gas efficiency and to bypass roadwork and bad road conditions. The investment in this software would be profitable in the long run.
No new vehicles had been purchased. The same trucks with just minor repairs were used. The competition is using newer fleets of trucks that are more efficient, and also have the look of success. In interviewing customers who had changed over, many claimed it was just because of the newer trucks and the advertising.
Just these 2 situations were covered. The business owner did not like the idea of spending money, but after they did, and just slightly raised their price margins, business came back. Just having the new robust software and vehicles created a road to more, and higher profits. The other benefit was the morale boost of the employees.
A sheet metal company has watched their business slide away terribly. Blaming the economy, they just let things slide, and laid off employees. When taking a look, we realized they were using turrets and break presses that were designed in the 1940’s. There was a high scrap rate from the use of the out dated machinery. In 1945, this machinery was robust, but not in the 2000’s. With the computerized lasers and break presses now in use, we pointed out how this company was operating in the past. After investing in up-to-date, and robust equipment, profits, and business climbed immediately. They hired back the employees, added more, and watched the business grow to a huge success.
There is a time when as a business owner, it does pay to invest in the more robust and latest tools and equipment. The competition will step all over you if you don’t.
Having an audit performed on your business can help you see the areas you should spend for the more robust equipment. It can also show you where to cut back. Having a professional audit will allow you the view of the future of your business. As stated in the title: the business with the best equipment wins the profits.
Equipment and machinery that you as the business owner or manager may want to consider upgrading could range from:
Computers and software
Forklifts or transportation vehicles
Quality control measurement devices
The work space
A professional audit can give ideas and suggestions that can show you where upgrading can add profits to your business.
About the author
As a book author and freelance writer, Greg Boudonck writes on a variety of subjects. His favorite subject is business management. With well over 10 years of professional writing experience, you will find Greg’s material easy to read and understand. Visit Greg’s website: Lancerlife.com to see more.