Every business would like to increase sales and profits, but many small-to-midsize businesses don’t know which actions to take or which changes will result in the greatest improvements.
These companies often make changes but don’t really know what results to expect. Business intelligence (BI) is a tool that can pinpoint issues in need of change and help guide your organization toward better profitability.
Here are just two examples of how BI can be applied:
Unprofitable Product Lines or Customers
You can use business intelligence to compare actual revenue and margins on specific products, product lines, or even certain customers. The analysis helps identify the most and least profitable products. Marketing may choose to run a promotion for the most profitable products while de-emphasizing or even discontinuing the less profitable ones. You may also discover that the customer you thought was one of your best sources of revenue actually adversely affects overall profitability. You may choose to renegotiate your contracts with these clients or even stop selling to them altogether.
BI also provides a good analysis on the cost of products. You can reduce the cost of producing products with low margins so that the same level of sales produces higher margins and more profit.
It’s relatively easy to compare a salesperson’s performance to quota. However, with BI, you may discover that certain reps discount more than others, or that the most successful ones sell to specific customer types while the reps producing lesser sales have a different focus. This information can help identify salespersons in need more training, or help produce ideas for new ways to structure sales compensation that results in higher overall profitability.
There are many more ways that business intelligence can provide insight into your business to maximize sales and profitability, so isn’t it time you started looking at BI?