As you may know, numbers are an important part of what I do with clients. It’s about helping them understand the numbers better, but also analysing the business and really understanding what’s happening through the numbers.

What I’ve shown in the video is how small incremental improvements can have a massive impact on a business. I use an example business that has $100 of revenue, $50 of cost of sales and $40 of Overhead Expenses. This gives us a profit of $10. I’m going to show you how a 1% increase in sales plus a 1% increase in price plus a 1% reduction in cost flows through and what the final impact of those small little changes are to this bottom line.

If you look at the difference between that $10 where we started and the $12.41 ending profit, the difference is $2.41 and if you look at that as a comparison to where we started, the 10% profit, that has meant an increase of 24.1%, which is amazing.

It’s amazing how these 1% small increases and changes can lead to a massive increase in your profitability. Now if the starting revenue wasn’t $100 but if this was $1m then that would be $24,000 extra money in your pocket. And as the businesses grows that dollar figure becomes a lot bigger.

So go back, have a think about how you can increase your sales, how you can increase your price and how you can manage your costs better, and you’ll have a massive, massive increase in your bottom line.