How might a company boost its profitability?

To boost profitability a company will basically either (a) cut costs or (b) increase revenue. To do the former they will need to look for ways of increasing efficiency via reductions in their cost base. This might include: de-layering or re-structuring the company, they might discuss ways of substituting machinery for labour or research ways of sub-contracting various parts of the business. They might rationalise or outsource some functions. They may even consider changing location to a lower cost country. To build revenue streams they will probably look to increase market share, increase average spend per customer or even move into new markets. They will also look carefully at their product portfolio and look at ways of developing USP’s and the ‘mix’ of products and services they currently market.

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