Double Your Profits PDF Summary

blog.12min.com/double-your-profits-pdf-summary

February 8, 2017

<1 min read

Which entrepreneur does not dream of multiplying profits? It sounds like a distant
dream, doesn’t it?

Bob Fifer, a leading financial advisor, says that this is possible and brings us a clear plan
to get there.

In Six Months or Less

In his research, Bob Fifer analyzed several American companies to give you a guide on
how to increase profitability.

First, keep in mind that your primary focus should be profit. To increase return, you need
to work on three major pillars: culture, costs, and sales.

You will learn how to considerably increase your profits with this microbook!

“Double Your Profits Summary”

A Company Focus Must Be Profits

The primary concern of any business must be lucrative: a profitable company has the
money to reward employees, offer exciting careers, and invest in new products,
companies, and technologies.

Less profitable companies inevitably sink into mediocrity in every way – regarding
morality, product quality, etc. Doubling profits requires focused, consistent, firm and fair
management, willing to become different and better than most other companies.

Creating A Lucrative Culture

It is important to rely on meritocracy and use the philosophy of continuous improvement

to increase your profits. This philosophy should be part of the company’s culture, creating
and encouraging a culture of excellence among all stakeholders.

To create a winning culture, employees must have the opportunity to reach the top, but
only the best should be able to get there and be rewarded for it.

Some important points to disseminate a culture of success in your company:

Focus on what is important, the results of the enterprise: Beautiful names

for areas and positions will not make a difference in productivity.

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 Do not build new processes unless necessary: methods are costly and usually
do not generate useful results.
Define the mission of the company and make it clear and
straightforward for all employees: Be the best company in the market. This
clarity will move the entire company to excellence.
Never be sorry for thinking about profits: Never apologize for the effort to
maximize profits. There is no need to apologize. If you are frank and in favor of
increasing your company’s profits, your employees will act the same way.
Only quantify what is essential: No one should waste time quantifying a
problem whose solution is already known. Quantifying costs time and money and
does not increase profits.
Give urgency to important things: You must assign importance to the most
vital. You must insist on creating a culture that states that nothing important takes
more than a few minutes, or a day, or a week – or a month if it is complex. Always
set short deadlines.
Maintain a shortage of resources: There is always a need to keep a significant
scarcity of resources since this is the only way to get people to separate productive
tasks from those that are not. *Be the best and reward the best.

Reducing Costs To Profit

Cutting costs should be taken very seriously. You have to be among the best in the world
to make businesses run better at a lower cost.

Costs should be categorized between strategic and non-strategic. Strategic costs are
spending on things that apparently add to the business and improve in areas of business,
marketing, and R&D (Research and Development).

Non-strategic costs are the costs necessary to run the business but do not directly bring
improvements or profits. An example of a strategic cost is sales investments. An example
of a non-strategic cost would be a reform of the firm’s office.

Double Your Profits

The company needs to follow two main rules for managing its costs: overcoming
competitors about strategic costs during good and bad times and not pulling any punches
when it comes to cutting non-strategic costs.

It is important to analyze costs to succeed in reducing non-strategic ones. It is crucial to

think that all non-strategic costs are unnecessary and must be justified. There are no “off-
limit-costs, ” and the manager needs to assume that all other expenses can be
discontinued unless proven otherwise.

Managers make the mistake of being cautious in cutting costs. Cut first and ask later. An
advantage of reducing costs is that if you make a mistake, someone will be ready to tell
you almost immediately, and you’ll be able to fix it.

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Another important point of attention is in the decision making: decisions must be made
without delay. If you do not need data, do not spend your time analyzing them, make a
wise decision quickly.

A good manager does 1% of the work, but contributes 50% of the value of the company,
because his discernment to make good decisions generates profits.

Also, it is important to set deadlines for stakeholders to meet. Not wasting time is
essential for cutting costs and increasing the profitability of the company.

Superiors must authorize extra costs. Items such as material purchases, the hiring of
employees and others should be looked at on a case-by-case basis. This discretion will
help eliminate useless costs and decrease unnecessary spending in the company.

Also, suppliers should not be overlooked. It is important to reduce these costs as well.
Have someone from the board or management take responsibility for negotiating prices
with vendors.

It is imperative to be someone in a higher position because suppliers are already used to

dealing with buyers and know how to negotiate with them. Have a director or a manager
analyze the costs of each provider thoroughly.

Also be concerned with research and development. Often, executives leave control in the
hands of researchers because they do not have the knowledge to do so. You should look
for a suitable manager who can measure the company’s R&D return, increasing your
chances of profitability.

Researchers usually do not have business knowledge and are not concerned with profit, so
this care is essential.

Finally, cutting costs should not privilege anyone. The goal should be to increase the
overall profitability of the company and eliminate unnecessary costs. Therefore, no office
or department should be safe. The intention must represent the individual and collective
effort to achieve better results.

Here are some winning tactics for cost reduction:

Know that it is always possible to reduce costs: The first step in reducing
costs is to see all values as, at best, a necessary evil. Every cost is something that
must be ruthlessly and as far as possible banned from any firm. There are no off-
limit costs, and they are obstacles in the company. Ask yourself: if you eliminated an
individual cost, what would you lose regarding revenue and profit? How and where?
If you do not know, then you do not need this expenditure. Only maintain costs that
are extremely necessary; you do not have to think twice to eliminate them.
Eliminate first and think later!

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 Demonstrate competence: Firmness and ability generate respect, not
resentment. It is the combination of toughness, incompetence, and mediocrity that
engenders resentment. Therefore, if you demonstrate competence, your firmness
will be accepted.
Inform your suppliers of their cuts and freezes: There is an almost
immediate way to increase profits. Send a circular to all vendors, saying that times
are bad and that from now on (or in the next twelve or eighteen months) you will
not accept price increases, so there is no use in insisting.
Delay your payments if needed: An easy method to favor your company’s
balance sheet this year, although it only works once is to delay your payments. Most
vendors prefer to wait to receive it to permanently losing you as a customer. Never
pay a bill until the supplier covers your company at least twice. Some providers may
take up to two years to claim payment for a bill. Also, whenever there is a price
increase tell the suppliers that you are going to research the competition. This
technique works most of the time and can help you maintain your margin. Find out
how much your competitors pay for the product and what their suppliers and
schedules are.
Make a plan to save: plan a saving of 15% in product purchases and 30% in
contracting services. If you cut too much, some people will complain. Let them
complain and wait. If they complain too much, rethink about that particular cost.
If necessary, fire employees: It is impossible to convince them that you believe
in a meritocracy if those whose performance is small can keep on the job and receive
the salary. Firing a bad employee encourages others to produce more for the benefit
of the company, and that is a meritocracy. It is possible to reduce up to 25% of staff
in most companies without anything happening – without any loss of value.
Staff Control: A busy employee is forced to set priorities and does what is
important. When it comes to staff, micromanagement or lack of oversight may
inevitably lead to slow and ineffective employees. The only way to promote
efficiency and eliminate unnecessary work is to keep human resources scarce.
Benefits and Bonuses: Pay good salaries and only offer benefits that your people
value. Any bonus, any perk that becomes “automatic” no longer has value as
motivation and becomes an instrument of maladministration, not good
management. Bonuses, rewards, and punishments are significant, with bonuses
being more effective when granted on a case-by-case basis and at irregular intervals.
Grant raises whenever they are earned and never otherwise.

The most difficult part of cost reduction is resistance to stakeholder change. Often, the
people involved do not see the importance of the process.

Therefore, it is vital that the company’s culture be responsible for showing the importance
of reducing costs for the company; make it a part of the firm’s routine. It is also important
to value employees who strive to make this happen in the best way.

Increase Your Sales

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You should understand that when selling, you should not see the customer from a
company’s point of view. You should see the client as a person and, as such, emotions are
critical when closing a deal. Whenever you make a sale, be sure to ask why the customer is
interested in the product.

Also, keep in mind that depending on your type of business and your field, customer
loyalty is essential. It is much easier to sell to a loyal customer than to win over a new
client; so seek satisfaction and rapport with your customers first.

There are five ingredients for a successful sale:

Show your competence;

Demonstrate empathy;
Be loyal;
Play hard to get;
Use the customer problem to turn your interest in them into an obligation from
them towards you.

Here are some points necessary to increase your sales:

Your consumers are not buying a product from you, they are in pursuit of
satisfying their needs.
To make a deal, you need to have confidence in yourself and your
product. Do not hesitate or the customer will not have confidence in what they are
buying. No matter how small, the consumer can perceive any hesitation on your
part.
Attract your buyer: We do not buy anything we do not like; we prefer to buy from
people we feel some empathy or at least that arouse our interest in some way. Part of
the process of selling is creating a need for the buyer. This attraction means having
charisma, good manners, and a pleasant personality. It also means having a sense of
humor and interest in what happens around us and the world, knowing how to
listen, and being easily understood.
Set your price the right way: Most companies forget money on the table when it
comes to calculating prices. The first rule of price calculation is the simplest and
most sensible, yet it is the most overlooked of all: always charge, from each
customer, the highest price they are willing to pay. Ask yourself if a price increase
would make the client no longer a customer.
Ask how much the customer is willing to pay: find out the sensitivity to the
client’s price. Talk about product price ranges and study the customer’s reaction.
That way you have a sense of what price range you can work with, and you may be
able to charge the highest possible price.
Target your customers to offer more customized products: this way you
can charge higher prices and maximize your profit.
Offer more than one product to the customer, so it will be more difficult for
him to refuse the sale.

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 When you lose a sale, review what happened. Study your mistakes and
evaluate how you could have circumvented the situation; What should you have
done differently? Try not to repeat the same mistakes with other customers.
Regardless of your sales process, respond quickly and professionally and do
whatever it takes to meet your customer’s needs.
Maintain a good relationship with the client in the after-sale. If he bought
it once, he could buy it again as long as he feels confident about you and your
product.
Do not forget to invest in marketing, your salespeople and customer support.
These are essential areas for attracting and retaining customers.

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Final Notes:
If you want to double your profits, worry primarily about these three aspects of your
business: culture cost reduction and increased sales.

For this, it is imperative that your employees also see the importance of these points and
feel motivated to help the company achieve its goals and objectives.

Working in a meritocratic environment is essential. Seek to recognize the best and those
who strive more for the collective goal and communicate what you expect from each
professional.

12min Team
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