Selling products in your business can be an additional challenge in understanding your business numbers and the impact the numbers have on the profitability of their business. It is essential to understand your products’ profitability on a deeper level. You need to understand the costs that go into creating your product and price it at a level that customers will buy your product and still offer a large enough profit margin to cover expenses and leave the business with some money left over.
Product-based businesses are dependent on knowing your numbers. Knowing your numbers is essential to find the profitability of your business. Product-based companies require detailed planning.
The Product Boss Podcast
Karen Michelle Seifert
Jacqueline Snyder and Minna Khounlo-Sithep are the combined force behind The Product Boss Podcast and offer courses and mastermind coaching to help you achieve the successful product-based business that you’ve dreamed of.
These ladies provide the best advice on ensuring your product-based business is set up for success. There is a lot of information that entrepreneurs need to navigate through, and The Product Boss puts their clients first by showing you the exact information you need to build a successful product-based business.
Here are some of the ways The Product Boss shows you how to build your business:
1. Focus on your profitable bestseller
There is always a bestseller in the list of products you are selling, but make sure that the bestseller is generating a profit for your business. When you zero in and focus on the most profitable bestseller, you are positioning your business for success because you are becoming known for your bestseller. Customers tell you with their purchases that they are willing to pay for this particular product, and you become easily referable via word of mouth and social channels. This focus allows for clear messaging when presenting your products, helping you grow faster despite limited resources.
2. Eliminate poor-selling products
Quite often, entrepreneurs are selling an array of products that isn’t necessary and takes the focus off the most profitable item. When you drop the poor-selling products, you can save your resources for the products that sell well.
3. Pricing your products competitively and profitably
Pricing can be tricky because you need to price your products at a price that consumers are willing to pay, yet be sure that the price covers all the costs that create the product and leaves a profit margin. Make sure to incorporate your cost of goods plus packaging that goes into your finished product and add in a “buffer” for overhead costs, such as shipping boxes, damaged manufacturing, etc.
4. Cutting costs to increase profit
When you have priced your product at a price that consumers are willing to pay and are left with little to no profit on your product, you need to cut costs to increase your profit. Batch manufacturing, bulk buying of raw goods, delivery charges and other areas are significant areas that can negotiate better prices.
5. Consider bundling items
When products are bundled in a way that reduces decision fatigue for the consumer and increases your sales, it’s a win-win for all involved. Bundles are a great way to get more product in the consumers’ carts and increase your sales.
The bottom line is the product-based business may represent some more detailed financial knowledge, selling products is an excellent way to serve your clients’ needs. It can be a rewarding and lucrative business to put your time, energy and resources in.
