If you've been wondering how to increase profits without increasing sales you should give yourself a pat on the back. Because it's a great - and very profitable! - question. If you can increase profits without increasing sales without spending any money, hiring any new staff, or otherwise increasing your overhead, which means your return on investment has necessarily to increase along with your profits. You'll have a better business as a result. But can you? In your business?

Well, if you sell something, rest assured: you can increase your profits without increasing sales. And the steps to do that are the same regardless of what you sell, or to whom you sell it. They have never been known to fail, and they can be applied by anyone, in any business. When you've applied them in yours you'll wonder why you didn't do it sooner, and pray your competitors don't catch on to your secret.

Let's say you have an art gallery. You've got a great reputation in the community, both with artists and collectors, and you can't see how you could increase your sales without changing your business, moving it to a larger city, or recruiting different artists, for example, neither of which you're eager to do. Can you still increase your profits?

You certainly can. The first thing you have to do is re-frame your business model. You're no longer in the business of selling art. You're now in the business of managing art collectors.

Think about it. Your relationship with the people who buy paintings in your gallery has great value. These are people who have chosen to do business with you, who like the artists whom you represent, and who are willing to pay you money to fulfill their desire to display original art in their homes.

To increase your profits without increasing the number of paintings you sell you need only increase the value of each transaction. And to do this, you need only ask your own private group of art collectors what you can do to add value to their purchases of art, for which value they will happily pay more.

For example, they may be prepared to pay significantly more for attractive imported picture frames. They might be willing to pay higher prices for paintings in non-standard dimensions suitable for areas of their homes which they may find difficult to decorate. They might be happy to pay a fee to have a member of your staff hang their painting for them, perhaps including advice about where it might look best, and even the best color for the wall on which it's to be displayed.

You haven't increased your sales by doing these things, you're still selling the same number of paintings, but you have increased the value of your transactions and your profits have risen accordingly. And all without the need to spend money on marketing, or move to a bigger location, or otherwise increase your overhead.

This process of increasing profits without increasing sales works in any business. Change your focus from making the sale to better serving your group of customers. By doing so you'll be able to increase the transaction value, and the corresponding profit of each transaction will increase as well. Whether you sell inexpensive items like donuts, or expensive ones like cars, you will, if you turn your mind to it and ask your group of donut eaters, or car buyers, find ways to add customer value - and dollars - to the sales you're currently making. You'll have a more valuable business if you do, and happier, more satisfied, and more loyal customers who will be pleased to continue to reward you with their patronage.

Learn more about this author, David Riel.
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