Business
Useful growth strategies to increase revenue for your business
Growing a small business is no easy feat. It requires a tremendous amount of perseverance, dedication and focus.
Growing a small business is no easy feat. It requires a tremendous amount of perseverance, dedication and focus. If you want your business to bring in more money, this article contains methods you can consider. Imagine you are operating a boutique and you want to increase the amount of revenue that the boutique brings in, here’s how to apply these strategies:
- Increasing the number of customers means you are trying to bring more people in the door. This strategy is relatively straightforward: more visitors to your store will equal more sales, which (assuming the average transaction size stays the same) will bring in more money.
- Increasing average transaction size means that you are trying to get each customer in to purchase more. This is typically done through a process called upselling. The more of these items the customer purchases, the more they spend.
- Increasing the frequency of transactions per customer means encouraging people to purchase from you more often. The more frequently they visit your establishment, the more revenue your boutique will bring in, assuming the average transaction size stays the same.
- Raising your prices means you will collect more revenue from every purchase a customer makes. Assuming your volume, average transaction size, and frequency stay the same, raising your prices will bring in more revenue for the same amount of effort.
What more can you do?
Expand your market
Augment your existing client base with new products, new geographic territories, and additional sales resources. Many small businesses limit their marketing and sales efforts to the immediate area surrounding the central location of their business. Don’t assume another market is being served without investigation.
[READ MORE: A guide to identifying your profitable customers and improving your sales (1)]
Enter into cooperative sales agreements
Contact businesses that sell complementary products or services with a request to sell your products also. Many companies actively seek complementary products, as they add very little to marketing and sales expenses – it is just a matter of finding the right partner. Getting additional salespeople for no out-of-pocket cost is a sure sales booster.
Hone your pricing strategy
While a small increase in price may not seem significant when compared to the full price, the impact of the increase on profits is magnified since the increase will flow directly to the bottom line. Price is the single most important factor in a decision to purchase a product or service. A low price can represent a “bargain” or low quality in the buyer’s mind. Before implementing any pricing strategy, know how your customers feel about your product so that a change in price encourages the market behavior you want. Always consider your prices “temporary” and adjust them to meet the market and competitive circumstances. Knowing how your products compare with similar products from the buyers’ viewpoint, as well as the prices of competitive products, will allow you to best position your prices in the marketplace.
Bundle products
If you sell products that naturally go together, or are used for the same task or at the same times, consider selling them as a package.
Add, reduce, or eliminate shipping and handling charges
In lieu of raising the price of a product, consider adding a shipping and handling charge. The net effect on revenues is the same, while avoiding buyer backlash to a price increase. If you currently charge for shipping and handling, consider reducing or eliminating the charge for a specific time frame in order to stimulate sales.
Offer special discounts
Discounts, properly marketed, create a special buying opportunity in consumers’ minds, often spurring them to take action. The discounts can be applied to limited products, such as a single manufacturer’s brand, a limited category like school supplies, or all products in a store-wide sale.
In fact, you can create a sales environment for almost any reason:
- Quantity Discount: When two or more of the same product are purchased at the same time.
- Tie-In Discount (“Bundling”): When two or more different products are purchased at the same time.
- Seasonal Discount: When products are bought within a specific time-frame.
- Conditional Discount: When the products purchased are used or reconditioned.
- Stripped Discount: When the products purchased are “stripped” of one or more features.
Invigorate your sales collateral
The importance of sales collateral – brochures, presentations, product data sheets, pictures – is often overlooked by business owners. Your sales collateral, including your website, is a reflection of your company. A vibrant, bright-coloured document complete with drawings and pictures draws attention and generates excitement in its content; dull, boring materials are typically trashed without a second thought.
Review your sales materials, item by item, to see whether they convey the image and message you want to present to your customers:
- Do they include all of your products and their latest innovations?
- Do they adequately portray the advantages of your products by linking features to benefits?
- Do they convey a sense of urgency with easy instructions for purchase?
If your brochures, presentations, product data sheets, pictures, or website don’t simply and clearly present information which will spur your prospects to take action, it’s time to redesign them.
[READ ALSO: A guide to identifying your profitable customers and improving your sales (PART 2)]
Renew old relationships
There is a lot of chatter in the business circle about customer experience as a potential stimulant for revenue growth and this is simply because purchasers are now more empowered than ever before. It is easier to sell to an old customer than to find a new one. Products previously purchased wear out, break down, or become obsolete. Develop a marketing program to communicate with old customers and prospects, and contact them on a regular basis about your company and your products. Ask your old customers for referrals and written references. Make them feel as if they are a valuable component of your success. Downplaying old relationships is no longer an option for businesses, as the voice of the customer continues to get louder.
Business
CBN adds Maize importation to “41 banned list”
Dealers are to return their forms on or before Wednesday, July 15, 2020.
The Central Bank of Nigeria (CBN) has directed all authorised dealers to immediately discontinue the processing of Forms M for maize/corn importation into the country. This directive is contained in a notice that was addressed to authorised dealers and signed by Dr O.S Nnaji, CBN’s Director in charge of Trade and Exchange Department.
In the notice which was made available to the public earlier today, the CBN noted four main reasons for the directive to discontinue maize importation, The reasons are:
- To increase local production
- To stimulate a rapid economic recovery
- To safeguard rural livelihoods
- To increase jobs
In line with this development, all the authorised dealers have been told to return all the Forms M they have already registered for the purpose of importing maize. They are to return the forms on or before Wednesday, July 15, 2020. The notice by the CBN said:
“As part of efforts by the Central Bank of Nigeria to increase local production, stimulate a rapid economic recovery, safeguard rural livelihoods, and increase jobs which were lost as a result of the ongoing COVID-19 pandemic, Authorised Dealers are hereby directed to discontinue the processing of Forms M for the importation of Maize/Corn with immediate effect.
“Accordingly, all Authorised Dealers are hereby requested to submit the list of Forms M already registered for the importation of Maize/Corn using the attached format on or before the close of business on Wednesday July 15, 2020. Please ensure strict compliance.”
What this means: Recall that in June 2015, the CBN issued a circular containing a list of 41 imported goods and services that were banned from accessing Nigeria’s official Foreign Exchange Market. A Nairametrics report at the time had noted that the ban was another hard-line position taken by the apex bank to keep control of the demand of the dollar to as low as it possibly can.
Over the years, the CBN has been modifying this list by including more items. The addition of maize/corn, which is a widely-consumed staple food in the country, is the latest modification.
It should be noted that cereals (which include maize and other assorted grains) make up Nigeria’s top ten imports. In 2019 alone, the country spent about $1.3 billion on cereals importation, according to World’s Top Export.
You may see a copy of the CBN notice along with ‘the attached format’ by clicking here.
Business
CITN issues rejoinder to ICAN’s claim over court case
The rebuttal claims that there are some ‘critical misinterpretations’ contained in ICAN’s claims concerning the judgment.
The Chartered Institute of Taxation of Nigeria (CITN) has issued a rebuttal to the “critical misrepresentations” that are supposedly contained in a notice to members sent out by the Institute of Chartered Accountants of Nigeria (ICAN) over a court case, as reported by Nairametrics.
Recall that ICAN had informed its members that Justice S. A. Onigbanjo of the High Court of Lagos State ruled in their favour by striking out “Suit No. LD/3288GCM/19 – CITN VS ICAN” which was filed by CITN. In the suit, CITN had, among other things, prayed the court to restrain ICAN members from filing tax returns with the Federal Inland Revenue Service (FIRS) unless they have a CITN license.
CITN’s position: Now, in its rebuttal to ICAN’s claims concerning the court case, a copy of which was sent to Nairametrics, CITN clarified the following points:
- The Ruling of the Hon. Justice S. A. Onigbanjo of the 2/7/2020 in LD/3288GCM/19 did not invalidate the MOU and TOS because it did NOT address the issues in the substantive suit, itself. However, since ICAN has resiled from the MoU and ToS it freely entered with CITN, the CITN will not stop ICAN from walking away.
- The Judge only struck out the suit based on the Preliminary Objection of ICAN to the effect that the suit was an abuse of court process because the issues in it were the same as the issues in FHC/L/CS/125/2019 – ICAN VS FIRS & 1 OTHER which was earlier decided in favour of CITN. However, the issues in the two suits are completely different and distinct as has now been explicitly admitted by ICAN in its Notice under reference when it said: “The earlier ruling at the Federal High Court in Suit No. FHC/L/CS/125/2019 did not make pronouncement on the memorandum and terms of settlement between ICAN and CITN.”ICAN having admitted that the judgment in FHC/L/CS/125/2019 did not make any pronouncement on the MOU and TOS (and this is a fact), how then could issues in that suit be the same as those in LD/3288GCM/2019 (decided by Justice Onigbanjo) which only asked for judicial pronouncement on the MOU and TOS?
- Regulation 5 of the Tax Administration (Self-Assessment) Regulations, 2011, was categorically annulled by the Hon. Justice Liman in the judgment delivered in FHC/L/CS/125/2019 on 21/11/2019. None of the lawyers to the parties (including ICAN) can deny hearing the annulment of Regulation 5 during delivery of the judgment. It is unfortunate that ICAN is jumping the gun in a case with a pending post-judgment application.
- In the judgment delivered in FHC/L/CS/1480/2018 – CHIEF IGBAROOLA & OTHERS VS FIRS & OTHERS on 21/5/2019, the Hon. Justice A. O. Faji, declared: “CITN Act is thus superior to ICAN Act on the issue of tax practice. The Self-Assessment Regulations being in conflict with the CITN Act is null and void. The Plaintiffs cannot practice as tax agents without first being members of the 2nd Defendant.”
- In the Court of Appeal judgement of 2013 between ICAN v. CITN, it was held that the power to regulate and control the tax profession, to the exclusion of any other body, in Nigeria lies with CITN.
- It is, therefore, now firmly settled from all the relevant judgements at the Lagos High Court, Federal High Court and the Court of Appeal, which have all upheld the primacy of the CITN Charter, that no member of ICAN can practice taxation without first being a member of CITN.
- For the avoidance of doubt, no ICAN member, who is not registered with CITN, has been permitted by any law or court decision to practice taxation. The law has made it clear about the professional body that can regulate tax profession in Nigeria and CITN reserves the right to invoke the relevant provisions against any person that violates the provisions of its charter.
The backstory: The disagreement between ICAN and CITN dates back to 2015 following a misinterpretation of a Memorandum of Understanding (MoU) and Terms of Settlement (ToS) between the two organisations. Due to the disagreement, CITN took legal actions in a bid to basically make the MoU and ToS binding on ICAN members.
You may read CITN’s full rejoinder by clicking here and follow up on ICAN’s notice to its members here.
Business
UPDATED: Court rules ICAN members do not need CITN license to file tax returns
The suit, which was filed some years ago by CITN, was basically struck out for lacking merit.
Justice S. A. Onigbanjo of the High Court of Lagos State has ruled that members of the Institute of Chartered Accountants of Nigeria (ICAN) do not need to be licensed by the Chartered Institute of Taxation of Nigeria (CITN) before they can file tax returns.
The ruling on July 2nd followed a suit filed by CITN trying to restrain ICAN members from filing tax returns for their clients unless they have a practicing CITN license.
A notice to ICAN members regarding this development, as seen by Nairametrics, noted that Justice Onigbanjo struck out the suit after describing it as “an abuse of court process and an embarrassment to the judiciary.”
The backstory: Nairametrics understands that the disagreement between ICAN and CITN stemmed from the misinterpretation of a 2015 Memorandum of Understanding (MoU) and Terms of Settlement (ToS) between the two organisations. Consequently, CITN had filed a suit before the High Court of Lagos State, seeking the following:
- A declaration that the Memorandum of Understanding and Terms of Service both dated February 12, 2015 between the CITN and ICAN are valid, subsisting, and binding on the CITN and ICAN.
- An injunction restraining ICAN whether by its agents, privies, assigns, or whosoever called, from repudiating, resiling from or acting in any manner or doing anything that is inconsistent with, contrary to or is a violation of the Memorandum of Understanding and the Terms of Settlement dated February 12, 2015, between the CITN and ICAN.
- Determine whether the Memorandum of Understanding and Terms of Settlement both dated February 12, 2015 between the CITN and ICAN are valid, subsisting, and binding on CITN and the ICAN.
However, last week’s ruling by Justice S. A. Onigbanjo which, by the way, was delivered virtually due to COVID-19, has made it impossible for the CITN to implement the terms of the 2015 MoU and ToS. The ruling also aligned with ICAN’s earlier objection to the MoU and ToS.
The status quo: In view of this development, ICAN has informed its members that they do not need to obtain any license from the CITN before they can file tax returns for their clients with the Federal Inland Revenue Service, FIRS.
ICAN members were also informed that an earlier ruling by the Federal High Court on the case does not affect the status quo. This is because “the earlier ruling by the Federal High Court in Suit No. FHC/L/CS/125/2019 did not make pronouncement on the memorandum and terms of settlement between ICAN and CITN.” More so, regulation 5 of the FIRS Act was not reflected in the earlier judgment of the Federal High Court.
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