How to unlock sustainable profits – quickly!

By: William Buist on : 11th April 2016: Business Design, Business Model, Business articles: 8 Comments

Sustainability is one of those things we hear a lot about in today’s busy world. What does it actually mean though?

Sustainable Profits are reliable and repeatable, they are generated because you add significant value with your product or service in a way that customers recognise and are willing to pay a fair price for. That fair price is above the costs of providing the service and so generate profits. They become sustainable because the value comes from something that isn’t easily copied and so others can’t undercut you and commoditise what you do.

When you sell confidently and customers receive what you promise and they expected – everyone wins. The customer’s swapped money for the outcome and got the outcome they wanted, and you’ve swapped skill and experience for more money that was needed to provide it.

Simple to say, harder to implement. We’re often too close to see the full value of what we have been doing, and ways of making the delivery both top quality and fairly priced may need skills we haven’t yet got. That’s why we recommend the following three steps:

  1. Share your story with a trusted group, have them question and challenge your assumptions and deepen your understanding of what you do.
  2. Design a new process for delivery of your product or service, change one thing to either increase the value, or decrease the costs.
  3. Use the results and feedback to hone your offer, value proposition, delivery approach & cost base to lock in and make your profits sustainable.

Working with a trusted ‘mastermind’ group through this process helps to make sure you stay in track, in focus and work, literally, on purpose.

Mastermind Opportunities

The xTEN Club offers open mastermind sessions in London and Bristol. These sessions are designed for no mopre than 6 business people to present an opportunity or request new insights from the group through a structured process. You’ll leave with clear implementable actions to provide an immediate business benefit.

The xTEN First Friday London Mastermind

The xTEN Bristol Mastermind

8 thoughts on How to unlock sustainable profits – quickly!

  • When written down it is indeed a simple concept which I think has been diluted in the internet age as it has become easier to know the price of everything and where to get the cheapest deal.

    However in my field I see many examples of the cheapest deal was only the cost not the value.

  • Lot of truth in the phrase “Many hands make like work” especially if they are skilled and practised in their specialist fields of sales and marketing.

  • You can lead a horse to water but you can’t make it drink. To arrive at your objective you have to make sure the water looks appetising, that it is clearly visible and the horse is thirsty!
    This in the business arena is not always easy.
    I like the three steps which allows a trusted outsider to see more of the gain.

  • William, you state that “They become sustainable because the value comes from something that isn’t easily copied and so others can’t undercut you and commoditize what you do.”

    First, I am missing how your definition of something that isn’t easily copied has anything at all to do with the concept of sustainability? Second your missing 2/3rd of the definition of “Customer Value Add”, so while I agree that “the customer is willing to pay the price” is 1 of the 3 elements that makes a product/service value add, there are 2 other requirements needed.

    The second is that the product/service physically changes toward completion as it moves through the process (in other words, customers to not want to pay for your inventory, waiting, transportation, over processing, waiting, and other forms of “Waste or Non-Value-Add” (See Lean Six Sigma – 7 Forms of waste to learn more).

    The 3rd element is that the product or service is “Done right the first time”, in other words, customers to not want to pay for your mistakes, rework, and learning curve). Now all that has to do with “Value Add” and sustainability means you can do that the process is both repeatable and reproducible over time. This can be backed up with data for example using a Control Chart to statistically prove that your product/services will meet the customer requirements consistently over time and that special cause variation is not influencing the process of delivering products and services.

    Without data showing that your processes are under control, then how would anyone ever really know if the process is sustainable?

    • Thank you for your comprehensive comment, Steven.

      My point about ease of copying in relation to sustainability is that where things can be copied easily with no loss of utility for the end customer, there’s a tendency for the product to be commoditised, and prices and profits fall. That’s not to say that a business can’t be sustainable when it sells commoditised products, but it’s tougher.

      I think customers want to pay for the utility they get from the product or service at a price they judge to be fair. In general, that means in their judgement they get more from the product than the money they spend on it, or could spend on an alternative. For the business that ‘fair’ price must be sustainably viable. Waste, inventory, transport and so on all affect the costs the business has and of course have to be considered and properly managed. I entirely agree.

      When these elements are optimised, which requires good data, well analysed, the whole system is delivering great value to all involved.

      One aspect, of course, is that customer needs aren’t static, and nor is the business environment; so you also have to be constantly adapting to how they change.

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes:

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>