Are You Happy with Your Margins?

May 24, 2022 Selling Comments Off on Are You Happy with Your Margins?

Achieving acceptable or excellent margins it’s something we all strive for.

Simply said, in order to increase gross margin, we can either increase the sales dollars or decrease the material, labor and/or overhead costs. This is many times easier said than done. So how can this be accomplished?

Simply increasing the sell price can cause all kinds of difficulties, most of which we do not want to happen. So, what can we do to increase our sale price while minimizing the pain?

Increase value is the answer. We need a strategy that increases value, but this in itself is not easy.

What can we do to increase value?

Become more valuable to customers by understanding their processes so we can see things through their eyes and translate our products or services in a way they can more easily understand and see value.

Deliver our products or services in a timelier and/or transparent manner that delivers more value to our customer.

Engage in value engineering so we can decrease our price while increasing our margin.

Engage in an overall strategy to increase our overall volume thereby decreasing our overall price while increasing our margins.

Of these options, the first is the most productive and requires that we choose our customers wisely based on our past successes and the ability of these successes to deliver value.

Simply said value is the key to success. The more value we deliver to our customers, the more margin we can enjoy. Value is tied to understanding our customer’s processes and integrating our products and/or services into their processes thereby increasing our value.

We would love to show you how Strategen can help you do this.