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Money Talks

Money talks. The question is what your money is saying to you. For most of us, it says, “Use me to grow the business,” or “Invest me for a more secure future.” But sometimes, in spite of your best intentions, it seems that your hard-earned cash is saying, “Bye-bye!” and being spent almost as quickly as it is made. Been there?

Money Talks

27 Ways to Ensure Your Money Won’t Tell You Goodbye

Fran Carville, CRM, Carco Awards/

(Originally published in the September 2015 issue of Recognition Review.)

Money talks. The question is what your money is saying to you. For most of us, it says, “Use me to grow the business,” or “Invest me for a more secure future.” But sometimes, in spite of your best intentions, it seems that your hard-earned cash is saying, “Bye-bye!” and being spent almost as quickly as it is made. Been there?

We have worked hard and grown successful businesses with healthy profits and a positive cash flow. We have paid attention to our profit-and-loss statements and made necessary adjustments during good times and bad times. We have taken steps to keep ahead of the competition and our sales reflect our hard work. We have done everything we need to do for continued success and our money says, “Growth.”

And yet, even though many consumers see business owners as wealthy individuals that sit atop our piles of money at night, we know the reality is much different. Most of us could benefit from a little more money. A little more money to invest in our companies. A little more money to increase employee benefits. A little more money to put into retirement funds. Yes, a little more money would not hurt, would it? So, try these ideas to help you have a little more money by year’s end.

Review Credit Policies

All companies have policies about extending credit and credit terms. But do you follow your own policies all of the time?

  1. Any new customers requesting credit should be happy to fill out your store’s credit application. Once this is done, take the time to check references. We recently had a request for credit, but when references were checked, we discovered a problem. We informed the customer that we could not extend credit at the present time, but would welcome their business with payment at pickup. They placed an order the next day, on our terms.
  2. Help your current on-account customers pay by sending them statements on a timely basis. If you are late sending out invoice reminders, don’t be surprised if customers are late with their payments.
  3. Consider changing a customer with a poor payment history to cash on delivery (COD). A customer that takes 90–120 days may not be helping your company grow.
  4. Make sure your invoices and statements are getting to the correct person. Your customer may be bad with turning in paperwork promptly, but the company may have a great payment record.

Review Revenues/Expenses Regularly

If you assume that your profit margins are better than last year or that your expenses have remained the same, you may be losing money.

  1. Review your prices on a regular basis. Evaluate how supplier pricing has changed this year versus last year. Make this a priority at least once a year. A retail acquaintance of mine told me recently that she just never seems to find time to review her prices. What?
  2. Review all expenses. Freight costs per piece have skyrocketed. Do prices reflect these increases on a per-piece basis? From rent to marketing materials to electricity to membership fees, all of your expenses must be considered to ensure that your profit margins are acceptable to you.
  3. Ask for better rates. When is the last time you evaluated how good of a deal your banking accounts are? Most banks now offer free account plans, but many times they don’t volunteer this information to current customers. What about your telephone directory? When we said we were going to drop all of our advertising from the book, the rate offered suddenly decreased by over $100 per month. Asking for better rates for cell phone coverage, insurance, and advertising may put more money in your pockets.

Review Your Giveaways

I am a strong believer in giving back to the community. But in business, it is important to evaluate your return on investment when giving merchandise or money for a good cause.

  1. Pay close attention to how much merchandise and how many dollars leave your business labeled as donations. How much money do you have budgeted for donations this year and how much have you actually given? And yes, merchandise does have a value. Do you expect a return on investment from donations? Do you have a method for tracking this? If you make donations with no expectations, make sure you know in advance that your bottom line will take a hit.
  2. Sponsorships also should be budgeted, so you know exactly how much you can afford. Look for sponsorship opportunities that will be good advertising for your store. Sponsor a city-wide soccer tournament attended by all teams, rather than sponsoring one team. Ask to present an award that your company sponsors. Before making a commitment, determine how many consumers will know of your sponsorship and if these consumers are a part of your target audience. Be willing to say no if a sponsorship does not fit into your budget and your marketing plan.
  3. Does your budget include money to be used for discounts on large orders or do you just offer a percentage off of retail if a customer pressures you? Not having a plan, not having a policy for this will hurt your profit margins, because an unplanned discount comes straight from your profits. Determine whether you will offer a discount and if you decide you will, plan in advance.

Wants Versus Needs

Recently, I was in a local toy store, where a child was screaming at the top of his lungs,“I NEED that toy. I have to have it NOW!” More and more, it seems we confuse what we need with what we want.

  1. Let’s get back to evaluating what our business actually needs to grow. Do we need the biggest, fanciest piece of equipment or will a smaller, less expensive version fit our needs just as well?
  2. If you decide “something you need” is actually just “something you want,” consider putting the money you were willing to spend in the bank instead. Then, when a genuine need arises, you will have the money.

Review Money Makers

Do you know what your Top 5 sellers are? Do you know what categories of products have the highest markups? Of course you do!

  1. Make sure your most profitable items are displayed front and center. Just as in your brick and mortar store, your virtual store should feature high-profit merchandise.
  2. Group items for easy add-on sales. Display name badges beside your Employee of the Month awards or coaches’ awards with Little League awards. Grouping a lower-profit item with a high-profit item can increase your profits.
  3. All items in your store cannot be top money makers, but some items are just dead wood. Get rid of this low- or no-profit merchandise to free up space for more desirable inventory. Look at your customer base and see who might be interested in purchasing these items at a reduced price.

Review Sales Opportunities

We market to our target audience every single day in some way. But we just might be overlooking some easy ways to increase sales.

  1. Increase your conversion rate with consumers that call, e-mail, or contact your business in any way except just walking into your store. Answer e-mails and social media conversations quickly and with thought. Take the time to really communicate and help those who took their time to contact your business. Make every effort to turn these inquiries into a sale.
  2. Sell more to your current customers. Find ways to let them know what you can help them with all year long. Think about selling your customers gifts for graduation, weddings, births, anniversaries, Christmas, Boss’s Day, Mother’s Day, Father’s Day, and family reunions. Remind your current customers that you sell signage, promotional products, or silk-screened merchandise.
  3. Find ways to get your customers and potential customers returning to your Facebook and Instagram accounts. Make sure there is always something new for them to see and purchase.

Review Your Budget

Developing a budget is pretty easy. Following a budget is more difficult, don’t you think?

  1. Make sure that your company’s budget is realistic. Just saying you plan to cut expenses is unrealistic, unless you have identified exactly what and how you will make the cuts.
  2. If you are not in the habit of reviewing your profit-and-loss statements regularly, change that today. That way, if there is a problem, you can correct it quickly. Finding out you overspent or underproduced several months down the road gives you no chance to correct the problems.
  3. If you feel that you could use a little help with budgeting, check out (as in piggy bank). This site has good information about banking, budgeting, debt, and retirement.

Review Your Marketing Plan

If you have not done a thorough review of your marketing plan lately, your dollars may no longer be getting the same bang for your buck.

  1. Are you still spending your advertising dollars on old-school marketing like telephone directories or daily print newspapers? If your target audience is under 40 years of age, these dollars may be wasted.
  2. Do you have the same website you did 10 years ago? It may be time to update your site to appeal to your current and future target customers. Upcoming changes to Google means sites that aren’t optimized for mobile viewing won’t rank as high as they once did in consumer searches. This means that folks might not find you when they search online if you have an outdated site.
  3. Consider your marketing message. For years we have used the tagline “since 1987” to promote our experience in the industry. But to a 25-year-old, that tagline just says “old.”

Look for New Opportunities

How long has it been since you identified a new way to increase your sales volume?

  1. If you have space in your showroom, consider adding consignment artisan merchandise. A local frame shop uses excess wall space for consignment art. If a piece sells, the shop gets a commission. Look for unique, locally produced items that you could sell as alternative awards or gifts.
  2. Is there a niche in your community that is underserved? Probably. Identify what it is and fill that niche. Use social media to alert targeted consumers about your new merchandise.
  3. Revisit your point-of-purchase display. If it has been in place for a while, customers will not give it a second look. Make this display a part of your promotional calendar and change it out every season.

Whether your sales volume is $100,000 or $100 million, growing your bottom line is important. Money allows us to add new equipment and merchandise to our store. Money enables us to pay a competitive wage for great employees. Money allows us a comfortable lifestyle. And as Woody Allen said, “Money is better than poverty, if only for financial reasons.”

The next time your money talks, what will it say?

Fran Carville, CRM, is an Awards and Personalization Association past president, educational speaker, 2008 Speaker of the Year, a member of the Hall of Fame, and winner of an Award of Excellence from the APEX Awards for Publication Excellence. Fran and her husband, Tom Carville, CRM, own Carco Awards in Baton Rouge, LA.

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