Product-based businesses will often explore different ways to increase sales in hopes of consequently increasing their revenue, boosting their inventory turnover rates, while reducing overall shipping costs.
Increasing the volume of sales can take on many different forms. Some businesses will choose to make internal changes through new products and process innovations, while others will expand their marketing efforts to reach out to existing and potential consumers.
Businesses looking for new ways to grow their sales volumes for increased profitability can consider the following tried and tested tips.
1. Market Penetration
If an organization sells products in a market with many local competitors, management can attempt to poach market share away from those competing businesses. Some of the tactics companies can employ to penetrate the market include lowering their price points, increasing advertising efforts, and hosting marketing promotions. The ultimate goal is to capture the attention of the competitors' customers while also retaining the existing customer base.
2. Expand the Market
Another typical strategy businesses can use is market expansion. This tactic involves converting nonusers to consumers through inducements such as price discounts or bonus items. This strategy can also apply to lapsed customers, who have previously purchased the company's products but have not returned to the business recently.
3. New Products for New Markets
A slightly more risk-prone strategy is developing new products specifically for new markets. The company may not be established or well-known in this newly chosen market and the product may not generate the level of enthusiasm and sales volume the company may be expecting. Therefore companies must conduct thorough market research and have a very high degree of confidence that a new product will work for the target market before expanding production.
4. Boost Marketing Efforts
Bumping up marketing efforts to promote certain products are likely to help generate increased sales. However, companies should put forth a marketing budget and be able to carefully track the metrics of their marketing campaigns to ensure that they are effective and profitable. Some marketing tactics that can be employed include increasing advertising budgets, distributing coupons, testing and measuring different strategies, updating the brand messaging, and leveraging website traffic to drive visitors to products.
5. Evaluate Pricing Strategies
Businesses should pay close attention to price-sensitive products to ensure their pricing strategies remain competitive. Companies that choose to lower their price points below the market average may see an uptick in sales volumes, however, it could be more challenging to offset the costs. On the other hand, businesses that offer unique or luxurious consumer experiences can increase their prices above the market average, which can lead to increased revenue but lower sales numbers.
6. Change Where Products are Sold
Companies that aren't able to add to their marketing budgets nor change their price tags may want to look into changing where their products are sold, whether it is online, through retailers, or via direct mail. Finding the right place to sell a product can drastically improve sales performance and volume. Companies should evaluate their current distribution channels and look to remove ineffective ones, implement new channels, or both.
7. Add More Variety to Offerings
If a company lacks a certain product selection that their competitors are offering, it may be wise to follow suit and begin selling similar products. While the company wouldn't be introducing a new product to the market, it would be offering a product that has already been proven to be popular among the current customer base. This can also help to boost sales volumes since customers won't have to turn to a competitor brand for that item.
8. Create and Leverage Relationships
Businesses should be actively trying to build relationships with non-competing companies or charities with the goal of cross-promoting each other's products and services. This will expose the business's product to a new audience which could provide new sets of customers and leads. Companies can also use social media advertising to expand their reach and build a community of loyal consumers.
While increasing sales volume through various marketing initiatives can help to temporarily boost revenue, the key to ensuring the business' continued profitability is in the efficiency of its systems, particularly the point of sale system.
The POS is the heart of all business systems as this software has the ability to complete transactions, monitor employee performance, track real-time inventory levels, and store valuable historical sales and customer data.
Businesses can introduce and monitor customer loyalty programs through their POS systems and track purchases made by returning customers to develop data-driven marketing campaigns that will further boost sales volumes.
POS systems can also help to reduce both direct and indirect costs. This software is an effective tool to keep track of remaining inventory levels in real-time and can be programmed to notify users when supply is low. This can increase the efficiency of the business while ensuring optimal stock volumes to prevent under or over-ordering.
Modern POS systems can also keep track of variance levels by monitoring recorded inventory levels in its system versus the counted stock quantities. This can quickly notify business owners of discrepancies such as mistakes, human errors, or even employee theft. The POS system can ensure that these mistakes are limited by increasing accountability and accuracy for all staff members involved.