9 Strategies to Boost Small-Business Profitability

Monday, June 07, 2021

When running a small business, profitability is of utmost importance. Businesses that aren't profitable can't stay up and running without a constant influx of cash from a steady source. Continually burning cash is no way to do business. It might seem to work for some companies, but in the long run, cash burn will eventually catch up, one way or another.

Small-business profitability by the numbers

A U.S. Bank study found that 82 percent of businesses that failed did so because of problems with cash flow, and it's easy to see why. Only 40 percent of small businesses are profitable, and 30 percent lose money on a continual basis. The remaining 30 percent break even, so they're not turning a profit either.

Business owners who aren't turning a profit can find ways to turn things around. At first, it may seem like the only way to increase profits is to raise prices, but it's not. 

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