Every business will, at some point, experience a drop in profits. Don’t panic, here are some a few things you can do to address the problem.
Find the root cause
The first thing to do when you notice a drop in profits is to examine your numbers and identify the cause of the fall. It could be that a supplier is putting up prices, or a drop in sales, for example. It’s likely to be at least one major factor, so once you’ve identified this you can look at how to address it.
Reduce your overheads
Look at your major overheads, is there anything you can cut back on? For instance, could you move to a smaller office or downsize your company car? Or it could be as simple as reducing spending on areas such as printing.
Get a fresh perspective
Bringing in someone independent of the business, such as a non-executive director, to have a look at it from a fresh perspective could help you to identify ways to make your business more profitable.