The familiar phrase of “’You can’t cut your way to profit’” doesn’t true anymore, at least not for small business, as posted by the Globe and Mail.

The 5 steps listed are:

1. Develop a Spend Strategy
The importance of an effective strategy proves to be able to reduce spending, and with reduced costs, the break-even point will be lowered.

2. Just One is Never Enough
You would have a higher risk if you put your money all on one thing.

3. Consolidate and Leverage
Suppliers will tend to give a lower price, if you order the large quantity (Ex. Costco), thus, reducing your costs. However, what if your business doesn’t need a large quantity, how would you obtain that reduced cost? By inviting other retailers to orders together, everyone can benefit from the lower price.

4. Manage Relationships
Maintaining a close relationship with the supplier is important because you depend on them to deliver the products in a timely manner. Furthermore, it never hurts to have a strong and trustworthy network.

5. Monitor Progress
Last, but not least, monitoring the progress of the business is always important. Since the economy is volatile, anything can happen!

Profit Growth