Original article published online at GMGSavings.com and on LinkedIn
For A/E/C Companies,
Finding New Profit Centers is a Must
To put it simply, a Profit Center is defined as, “The branch
or division of a company that creates profits individually and separately from
the main organization.”
There are essentially two methods of creating a profit
center for your organization. First, you can offer a new service that creates a
profitable revenue stream. Second, a
cost center can turn into a profit center by selling those administrative “cost
of doing business” services to other firms. As Management Professor William E.
Halal so eloquently stated to USA Today Magazine, “When a business firm becomes
a corporate community of entrepreneurs who buy, sell and launch new products
and services internally as well as externally, it gains the same creative
interplay that makes market economies so advantageous.”
For the purpose of this article we will focus on creating a
new profit center rather than converting a cost center into a profit
center. The easiest way to create a new
profit center is to add service offerings that align with an existing client
base.
For example, CPAs, A/E/C firms, and even most Contractors
have an existing base of business clients and referral partners who own
commercial property. Are they maximizing on the plethora of accumulated
property data, let alone the hard-earned relationships they’ve developed? These
are not cold leads or warm contacts but EXISTING CLIENTS who have already paid
money for their services. Failing to
monetize an existing client base with value-added services is just bad business.
So, how do I create a new service offering and market it to
my existing client base? The easiest way
to accomplish this is to partner with an organization that already has a
profitable service on the market that would be a benefit to your clients. Once a partnership is established, the next
step is to effectively spread the word to your existing client base.
Communicate how your new opportunities will benefit them and move them through
the sales cycle. If you have done it right, your existing clients will thank
you for your high level of client service. This truly becomes a “win-win-win”
proposition!
Terry (Ter) Scott with Growth Management Group, LLC (GMG)
provides custom services to business owners across the nation to increase
sales, reduce cost, and procure specialized tax incentives. GMG also offers
strategic partnership to firms looking to utilize their existing client
relationships to generate new revenue streams.
For additional information contact: Ter Scott at Growth
Management Group, LLC (218) 940.1334, www.terscott.com/bizmoney
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