The impact of COVID19 on businesses is significant, particularly on cash flows. For both fortunate businesses that have had increase in sales and those that have had a decrease in sales, it is vital to get back to the basics of where the cash flows are created. As a small business owner you are aware that Sales is the starting point of your business cash flows. So how do you increase sales? Let’s take a look at sales revenue and see some examples of how to analyse.
Understanding trends
When you have sales data of each of your products, take a look how each of your products is performing over a period of time. Data based on pre-COVID may not be reliable to understand what the users of your products are looking for in the post-COVID situation. Business Klinic can assist in providing data analysis for your products and also look at understanding drivers for your sales demand.
Remove unprofitable products
The COVID pandemic has provided an apt checkpoint for all businesses to stop and analyse the profitability of their entire product lines. We recommend setting a profitability limit to see how many products fall below this limit. Remove products for which sales continue to fall or fluctuate wildly.
Find modifications for products that are having low or zero profit
For products that are near your set profitability, try to look for modifications that can be done on the product to ensure customers still like the product. Business Klinic can point you to a variety of product design firms and freelance designers to spruce up your product. Most products can be improved both in terms of usability and performance. Customers always appreciate improvements that are provided to them proactively!
Change price points of products
Most products have a market-life. Business Klinic can assist you in deciding whether your product has reached its end-of-life and can recommend changes. One of the classic approaches to end-of-life is to reduce the price of the product. Price reduction or discounts are given to ensure that you are able to maintain the basic volume required for production. Keep a close eye on products that have a reduced price point.
Bundle or unbundle products
The usage of your product may have changed and therefore it may be that consumers would like to buy a combination of your products. Or it could be visa versa; your bundled product may need to be sold as its parts. COVID has brought about changes to consumer behaviors that will require your business to rethink the product bundles you sell.
These points mentioned above should act as a catalyst to get you thinking about how to improve your business in the post-COVID era. Business Klinic can help in assisting your business in a variety of ways.