"What is eating up my profit?" You ask, as you crunch the numbers late into the night. Your sales are high, or low, and you are in the red/black -- there is no name for the color your ecommerce business is right now. Before you tear your hair out, here are a few things you can do to increase profits and put your business on the right track.
Cut Overhead Expenses
The first and most sensible thing to do is take a hard look at your costs. Overhead is minimal for an ecommerce site -- your rent is usually virtual and does not run into thousands of dollars. Seriously scrutinize your bandwidth and server usage. Is it something you can live without? Does your traffic really justify the amount you pay for each month/day/year?
The next major expense for most ecommerce businesses is storage. For a large-scale company that ships hundreds, if not thousands of items a day, paying for a warehouse seems like a wise business decision. But is it? Calculate how much it is costing to rent space and think about buying it instead. Many small businesses can choose to run an entire profitable ecommerce site out of a garage instead of renting storage in town. What variables can you safely get rid of?
There are several ways to cut overhead without it hurting, all you have to do is figure out what you and your customers cannot live without.
Redesign Your Site
To be honest, the last time you really took a good look at your website was sometime around 1992, when message boards were still the most popular way of communicating on the Internet.
A professional web design team can help you create more profit by creating a new experience for your customers. They can help you your site to see where you lose customers and perform an analytics analysis. This can not only increase your profits but it can even save you money because this will help you get rid of dead pages.
An experienced web development team can also help you redesign parts of your website, like your shopping cart, to make navigation and overall experience easier. Streamlining your process will result in more sales.
Increase Prices
So, the last time you increased prices was sometime around 2008 -- but everything has gone up. You are afraid that increasing prices can result in lost customers. So you have kept everything dirt cheap. And this is killing your business.
Check if your competition has also increased their prices and plan accordingly. You may not even have to raise them drastically. A few dollars or cents added here or there can help you increase revenue across the board. See where you can tack on a few extra dollars to add some profit.
Create More Opportunities to Buy
You can create more opportunities to buy in several ways. You can choose to collaborate with a complimentary website for example. Let us say you specialize in handmade tea mugs -- why not ask a tea website to help you create a package deal a customer can buy for special occasions or holidays?
Special packages and offers are another way to entice customers and get them to buy more. A two for one deal is a great example of this type of package. Giving them 15% off on the next item is another. These tried and true strategies do double the work: clearing your inventory of slow moving items and netting you a healthy profit. Free samples also work, as well as offering discounts or rebates for certain amounts spent.
Create Loyalty Programs
Loyalty programs bring two things to the table: they make your customer feel special and they help you create a loyal customer base. Loyalty programs traditionally give freebies to people who invest -- which will encourage them to buy more, which in turn will increase your sales.
These are five of the simplest ways to create more profit for a struggling ecommerce site. There are many, many creative ways that can help you reach your target goals and satisfy your target market. All you have to do is find the one that works for you.
