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Cost of service vs cost of provision

5 replies

snapD · 25/06/2008 16:58

My business is only profitable when I sell my service on a larger scale

I am running at 1/2 to 2/3rds capacity

I advertise all over the place

But I can't increase sales - my fixed costs are exactly that fixed

I think I may be close to giving up

OP posts:
sinclair · 25/06/2008 17:16

Do your costs increase with increased sales or are they totally fixed? If latter, can you drop your price to increase volume? IS there a perceived market value for what you are doing?

Can you tell us broadly what you are selling?

snapD · 25/06/2008 17:37

They seem totally fixed

I could drop my prices to increase clients

What do I do with the existing clients - if I drop their charges I lose even more money

It does have value just not great value

I sell services (like cleaning/carework)

OP posts:
WestMidsAccounts · 26/06/2008 10:46

I?m not a sales expert but isn?t this a classic scenario. You have to consider that your current business is
existing service to existing customers

You need to think how can I achieve:

new service to existing customers (easiest option) or
existing service to new customers

but avoid
new service to new customers ? that?s too much change in one go.

Your best advertisement is your existing customers ? can you set up a reward scheme for referrals?

Alternatively: can you share the fixed cost with another business or outsource the fixed cost?

(apologies if I am teaching my grandmother to suck eggs)

snapD · 26/06/2008 13:31

No - this is good stuff

OP posts:
snapD · 26/06/2008 14:25

I think new stuff to existing customers/existing stuff to new customers plus rewards for referrals

OP posts:
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