Issue link: https://docs.hic.us/i/403552
explore as well. It's so easy to be overwhelmed by costs such as rent, because you don't easily see the resulting sales. A rent figure written on a contract is staring you in the face. There is no doubt as to the amount and the frequency. Sales, on the other hand, area gray area based on faith and hope. Thus, we tend to cut every corner in an attempt to keep the costs down, because those are obvious. (Not a bad thing, as long as cost-cutting is done logically.) For example, rather than take on that high rent retail location, it's much cheaper and easier to stay in the garage, or move in to some obscure commercial site. Yes, you saved on the overhead, but you probably lost a large amount of potential sales due to lack of visibility for your business. If you need walk-in traffic, then you must be visible. Analyze your location requirements and benefits without focusing solely on the price tag, initially. A good location might cost $3000.00 per month, but if it generates $6000.00 in net sales, by virtue of the location alone, then it could be considered a good investment, unless those same exact sales could have been realized in a cheaper location. Running a profitable operation requires constant attention to costs versus benefits. Large investments in equipment, software, locations, training, etc should not be avoided. Rather these expenditures should be analyzed to determine their benefit to your bottom line. For example, if you are a single head shop running orders that average six dozen pieces, you are most likely losing money by not investing in a larger piece of equipment, such as a 4 head or 6 head machine. Don't focus on the cost difference. Focus on the increased production capacity that the larger machine will create. Then compare the increased output to the increased costs. Chances are there will be a significant increase in profits for your business by investing in the larger machinery. Apply this concept to every aspect of your operation. A constant assessment of overhead, production efficiencies, and market preferences is a must. That is what running a business is all about. Those that apply sound business principles to their Embroidery Shop are the ones that succeed. Those who ignore them, tend to fail. Work smarter not harder! You must be aware of where your money comes from and how it's spent. Profitability is no accident. It's the result of careful planning and attention to detail. www.hsi.us care@hsi.us 144