2020 was a taxing year both physically and mentally for many shop owners. As the calendar turns to the new season, we as frozen dessert operators need to look forward and ask ourselves, how can we grow? What can we do now to plan for the upcoming season?
We're going to discuss five points for your business which are all driven towards how to make more profit at your store. Because in the end, that's what we all want to do. When we plan and grow our business, the end result is more profit. So how do we do it?
Create More Revenue. It sounds simple, I want more profit, I need more revenue. But how do we do it? Though we could talk about this for hours, here's a list of five things to consider when trying to increase revenue.
Being innovated in the industry is what drives consumers to your business. You need to come up with products that will draw people into the store. The more people you can get into your store, the more potential for sales. Create a menu and specialty products that are unique and different from the competitors. If you need help or inspiration, then check out some of our other blog posts, 3 Minute tips or our Frozen Dessert Academy. Once you've innovated some unique products or menu items you have to let people know about them. You need to communicate it out to your customer base and potential customers, whether that be through marketing, social media or other advertising channels. If you innovate new things and communicate that to your customer base, then work toward creating new customers through your other marketing channels, the combined effort will get customers into your store.
We go more into depth about this in our Grade & Grow sessions but the simple fact is, is you want to create more profit, you may have to charge more for your products. Generally, this is a resistant point for many business owners because they're afraid of customer blow back. The reality is, very few customers - if any, will complain about a price increase, if they even notice. Also, your cost for running the business and various supplies are going to creep up over the years. As your costs increase, your prices have to increase to cover it. There should be no guilt in charging and extra nickel or quarter per product. If you're providing a quality product, good service and value then you will not lose a customer over a couple of cents.
As a business owner we need to be diligent about our costs. We need to pay less for things and perhaps negotiate the best terms you can with your vendors. This doesn't mean try to cut costs so much that you sacrifice quality. Try to cut costs but maintain or increase quality. There are many areas of the business yo can look to cut costs. Whether that be with insurance, suppliers, vendors or service providers like your internet. Even cutting costs as little 1-2% throughout the year could lead to more profit in your pocket.
You need to look at what you're spending on staffing and labor. This is a cost that will go up over time so it's important to look at how you can get the most out of each employee or staff member while on the clock. Make sure you have a hiring process in order so you can attract the best staff member. Once hired, make sure you take the time to train them properly. How your staff members interact with your customers can have a huge impact on your profits. Find the right help and keep them.
This step will require a broad approach. You'll need to step back and take a look at the business as a whole. Are there places you can cut money, increase efficiency, save time or save your energy. As a business owner, this can be difficult because you're surrounded by it everyday. We touched on staff but another area of operations you can look into is your machinery. Is one of your machines at the tipping point of being outdated... it has costly repairs, it's not efficient or no longer meets your capacity requirements. Maybe a new machine cannot only save you money on service repairs and energy bills, but give you more time by lowering the amount labor while also decreasing product waste. As a whole, you'll save money, increase profits and give yourself more time.