Welcome to Amanda’s semi-regular blog, where she writes about how to improve business profitability
We underestimate the Knock-on effect
During the last fuel strike, many fuel stations had to close completely as their pumps were completely dry. When they ran out of fuel, they had no footfall into their stores and so they were unable to sell any of their ancillary products, milk, coffee, confectionery and so on. This is a great example where having one item out of stock can result in zero sales of a range of others.
The grass isn’t always greener
When you’re stuck in the 9-5 grind of a day job, particularly one where your time is charged by the hour, it can seem very appealing to jack it in and become self-employed. That feeling that you could be working for yourself is alluring – you could charge less, and still be better off.
I wonder how many people in this situation have read The eMyth Revisited by Michael E Gerber? If they have, they might be more cautious about taking the plunge to self-employment or a freelance lifestyle.
Stuck prices requires a leap
Many years ago, I ran a software development house. I and a team of 4 other developers wrote and supported bespoke software for a range of clients. We were writing what would now be called an ERP system, without the finance bit.
Around the time my second son was born, over 12 years ago, the company finances were in dire straits.
What’s your pricing strategy?
Peter Cook, CEO of Thought Leaders Business School say that “we are all dysfunctional about money.” I think this is worth bearing in mind when it comes to working out pricing.
The impact of price
An often overlooked lever in productivity is price. The measure of productivity is a value (£), so price plays an important part. Productivity is not the same as efficiency.