My business is running but I am not making any money
Okay, what's going on here now, my business is buzzing but nothing is coming into the coffers.
How can that happen?
Again, there are several reasons.
Your costs are too high.
My prices are miscalculated.
I am simply too cheap.
Your costs are too high
Your costs are an important point.
That's why good accounting is worth its weight in gold. Where are my costs?
Where am I spending too much money and where am I earning too little?
These are questions that are often asked far too late.
As long as their income is good, few people think about whether they can save money somewhere. This thought comes up when the going gets tough.
You should always keep an eye on your costs. You have to keep an eye on profitability on a regular basis.
Of course I pass on my costs to the customer and the customer will also pay a certain amount of money for good quality and reasonable work, but he will not use overpriced products/services.
But we can't sell products/services at dumping prices either. After all, we also have to cover our costs.
Calculating prices, unpleasant work, time-consuming. I'd rather take a flat rate.
The idea may not be bad, but how do I know if my price is right?
You don't! If you don't calculate, you can't keep your costs under control.
You also have to recalculate your products/services again and again.
Employees --> Costs/hour --> Total costs/employee
Material costs --> How much material do I use for the product/service.
Try to buy material when it is cheap.
Travel costs --> Employee earns 60€ and has a 15 min journey. So the costs are 15€ for the employee + costs for the vehicle.
Other (Of course, you have to define exactly what is charged here)
Profit surcharge = cost price * x% (the percentage is different for every branch)
And of course all prices include VAT.
Since we all work digitally nowadays, you can do such calculations with good
with good spreadsheet programs.
Am I just too cheap?
Now you might say that this is the same problem as with the calculation.
Yes... that is almost correct. But here I am starting from a different topic.
Some entrepreneurs are afraid that they are too expensive and deliberately make their prices cheaper.
With reasonably calculated figures and suitable quality, no customer has the problem to pay this money.
Your business is not helped if I make my prices too customer-friendly.
Everything has its price, including quality. You have employees you have to pay, rent, electricity.
The customer will say, poah ... That's your problem if you're too cheap.
He will only mourn you if you have to close your shop because his cheap source is gone.
You're not doing yourself any favours. You have a responsibility towards your employees.
You have to secure your own existence. You are not there to be the customer's welfare.
Sure, prices have to be fair and good. They have to make both sides happy.
How can I reduce costs, where do I start?
These are questions where the answers are not always obvious.
Above all, people often think, "Oh, that won't save anything. I don't have to save there.
Let's start with the little things.
Printing, do I really have to print everything? That costs not only paper, but also expensive printer cartridges.
You can also file a lot of things digitally. Yes... YOU are right, it's not the world now.
But! Every little bit helps.
And so I look at one item after the other and realise that I can probably save money in many places.
Do I buy material that I need regularly only when an order comes in or do I order when it is cheap?
Do I fill up the company car when it is empty or do I fill up when the fuel is cheap.
These are just a few examples of where you can reduce costs.