Creative Thinking Reaps Rewards

As the leader of a company, you wear many hats. The task that should capture most of your time is generating sales and revenue for the business. I've found that by taking a broad look at the company and creating new revenue sources, you can be instrumental in pushing your profits to new heights.

As a business owner, you should always be thinking about opportunities that will bring in additional income. You can't do that if you don't know what's going on in your company. Successful business owners have a feel for what is happening. They pay attention. They listen. They are on the front line, listening to what the customers are saying about the product or service. They are in the back office, listening to the employees.

Your employees, in fact, are one of your best sources for inside information on customer and product satisfaction. Listen to your front line people. Chat with them on a daily basis. The receptionist at the front desk and the salesperson out in the field know whether customers like the new product line or if complaints are up.

When you listen and collect information, you can make good decisions. You will create an environment where there are innovative ideas, constructive suggestions, and new opportunities for improving your product or service-and adding to your bottom line.

Look for Creative Revenue Opportunities

You may be able to generate new income for your business in a variety of ways. Maybe you can add a new product to your portfolio or expand one of your services.

There are many examples of companies that have created new opportunities for income growth. UPS has started to convert its cargo jets so they can haul passengers during Spring Break. FedEx is installing a delivery "slot" in the side of their vans so customers can drop a package into the truck while it's parked and the driver is inside a building. Many theaters rent rooms on Sunday mornings for religious meetings or lectures. Restaurants have added take-out or catering services. Delphi, one of the world's largest manufacturers of automobile radios, now sells stereos for John Deere and Caterpillar tractors.

The small business can create new revenue streams, too. For example, your landscaping business can add a snow removal service for the winter months. Maybe you can rent your equipment on nights and weekends, when you don't need it for your business. You may add a night drop box for your auto repair shop, so customers can drop off their vehicles and keys after regular business hours. Or maybe your restaurant can add catering services. Think "outside the box" for new uses for your products or services. You may be able to generate an unexpected additional revenue source for your business.

A Word of Caution

Don't stray too far from your company's core strengths. If the service can be added easily and with minimal additional costs, it is worth strong consideration. If, however, the idea will take a large amount of capital and management time in your first year, be very cautious. You must be diligent and fully research your options.

Whatever you ultimately decide, it's a good idea to spend time on a regular basis exploring new opportunities. Researching and reviewing growth opportunities is a much better use of your time than doing building maintenance, payroll, or administrative busywork. Be proactive! You may not succeed on your first or second try, but don't give up. Often, a small change in your idea can lead to new revenues. If you do nothing, you won't bring in new money.

Listen to Your Employees and Customers

As you think about creative ways to generate new revenue, remember this: there are no "small" ideas in business. Sometimes the very best ideas are the "small" ones. The next idea may generate outstanding new revenues or save you thousands, but you won't get it unless you've created a culture in which new ideas and suggestions are welcome.

The best ideas are an outgrowth of your current operations, so it is especially important to listen to suggestions from your staff and customers. Their insight into the business gives them an edge when it comes to recognizing opportunities to increase sales or identify lapses in customer service. For example, suppose you own a small retail sandwich shop that is open 10 a.m. to 6 p.m. An astute employee mentions that the busiest time of the day is between 5 p.m. and 6 p.m., while the mornings are slow. As a result, you realize that by adjusting your store hours to 11 a.m. to 7 p.m. you can increase revenues at no additional cost and, therefore, increase profits.

When someone offers you an idea, it's important to thank the person and acknowledge the contribution. Tell the employee or customer that the idea is worth some thought and let them know that you do consider all suggestions. Obviously, not all ideas are good ones. Some suggestions simply cannot be implemented because of the cost or time they would require. Sometimes the suggestion just doesn't fit into your company's goals or mission plan. The important thing is that someone cared enough to make the suggestion, so be positive about the contribution. And remember, it usually doesn't take a large investment or a monumental new thought to increase your bottom line.

If anything, be wary of the next "big" idea that is supposed to change your industry or the world. Very few big ideas actually make a big difference. Don't become easily enamored of ideas or services that are supposed to change the way you do business. I've seen many companies waste hundreds of thousands of dollars on unproven ideas that offered no real benefits.

Editor's Note: Jim R. Sapp is an international business consultant and former fast lube owner. He is the author of Starting Your First Business.