You Want to Increase Revenue?

You want to increase revenue? You’ve come to the right place. In this article, I’m going to highlight the big-picture stuff that’s holding you back from making more money, and a few tips on what you can do to fix it. There are only two ways to make more money: increase your capacity, or increase your throughput. In other words, increase how much work you can do, or how much work you’re actually doing.

Increase Your Capacity to Make More Money

What is Capacity

I’m going to sound stuffy here for a minute, so bear with me. Capacity is defined as the total level of work you can achieve in a given period of time. Most of the time, you just take the maximum productivity you’ve hit in one day and that’s your capacity. So, for example if one day your record for producing toys was 1,800 total completed toys that’s your capacity. Let’s say you break that record. You produce 1,850. That’s your new capacity.

Why Capacity Matters?

Your capacity is essentially the limit on the work that you can do. If you’re constantly bumping up against that limit, then you need to raise the ceiling. If you don’t then you will always be stuck where you are. There are a ton of different strategies for doing that, but the best I’ve seen is to figure out your bottleneck. Your bottleneck is like the top of a bottle of wine. You can only get out as much wine as the narrowest point. In your business, your bottleneck is, simply put the resource that is the most over-worked. If you want to increase the amount of work you can do, then you need to manage your bottleneck.

Increase Your Throughput to Make More Money

What is Throughput

Throughput is the amount of work you’re actually doing in a given period of time. It’s really that simple.

Why Throughput Matters

Throughput is how much work you’re doing. If you’re not doing a lot of work, then you’re not making a lot of money. Throughput is impacted more by your ability to get customers (marketing strategy) and keep them (deliverables and customer service). If you’re having a tough time getting new customers, take a look at your marketing strategy and change something. If you’re having a tough time keeping customers, take a look at your product and customer service. Maybe your product isn’t matching customer expectations (buyer’s remorse). Or, maybe they try it once and never use it again because it isn’t helping them make progress. If you want to make more money, keeping customer churn low is vital.

Conclusions

Making more money is simple. All you have to do is be able to take full advantage of the people who need your product or service to make progress in their life. If it seems like you’re capped out and can’t make more money, explore ways to increase your capacity. If you’re finding that you just aren’t busy, play around with your marketing strategy to get more customers, and take a look at your customer service and product if you’re having a tough time keeping customers.

And remember, don’t give up the ship!