Without so much introduction, we all know that business has to make profits. Hence, if you're a business owner, entrepreneur or a manager in charge to boost the profitability of your company or organization, the following 10 tips will guide you on how to increase your business profit
1. Increase owner's capital or investment
More investments mean more ROI (Return on Investment). Don't play too safe. Investing in business has its own risks. However,these risks can be calculated. Thus, if you have money that are sleeping or buried in your personal account, put a portion of it into your business operations according to your tolerable risks. Also, if you are squandering your money in personal expenses that don't have meaningful returns, try investing the money you are wasting into your business to increase your financial assets, as well as your financial performance. You can use it to increase your production, thereby increasing your revenue and profit.
2. Increase your debt
If you don't have your own cash or assets that you can put into your business, then try to obtain loans. You can get loans from banks, credit cooperatives, government financing programs, or even from your close friends, parents and relatives. Just like investing more capital, obtaining additional debts also increases your assets, which can be used to generate more income and profit. Loans are inherent to businesses. Even the largest companies in the world have liabilities. Just make sure you can pay on time, whether it's short-term or long-term.
3. Decrease your interest-bearing debt
Interest from loans is an expense. However, if the interest expense you incur is compensated by more profits generated from your loan proceeds, it's just fine. Interest expense is even deductible to your taxable income subject to limits.