Profitability is often overlooked, yet it is a critical measure for any business. Other items like gross sales and revenue sometimes overshadow profitability in owners’ minds. When they do consider profitability, owners often respond with measures that are ineffective, getting caught up in counting pencils—cutting small costs in one-time or infrequent processes. Usually, it’s the owner who conceptualizes and implements these solutions. For example, it’s surprisingly common for owners to try and save on janitorial costs by doing the cleaning themselves on nights and weekends. This is a huge waste of time for owners; in addition, the work tends to be pretty shoddy. Owning a business does not mean that you can get streak-free windows! In the long run, it’s cheaper to outsource this task.
The One-Life Game Plan™ uses the concept of operational levers to determine how to best improve profitability. Operational levers are areas of your business that have significant impact on your profitability with minimal effort. For example, if you own a medical practice , your biggest expense might be payroll. This would likely be an operational lever for your business. Making your payroll system more efficient can reduce errors and save time and money. Because these processes are repeated, any changes made will have a cumulative effect, making a larger impact on your business with less effort. The important thing to note here is that operational levers are unique to your business model–no two businesses are identical.
If you want to discuss what operational levers might exist in your business, and how to leverage these areas to increase your profits, contact us at (410) 893-9100 to schedule an initial consultation call.