9 tips to increase profitability in your training business
Everyone wants to operate more profitably. After all, profitability is an important key indicator of how the business is performing.
Whilst it can feel challenging to increase profitability in a training business, often the simplest ideas can help increase profitability.
Are you ready to create a more profitable training business? Then follow these 9 tips!
Increase number of sales
An important part of running a profitable training business is, of course, about making money. You can do this by, among other things, working to increase the number of sales.
Here are three things you can do to increase sales:
Generate more leads
Improve the process you use for attracting interested potential customers.
If find that currently 5 out of 10 interested individuals end up becoming your customers, you have the potential to increase your profits by as much as 50% if you increase the number of interested individuals from 10 to 15.
Convert more leads
Having a bunch of interested people doesn’t help much if you can’t get them to actually buy courses from you.
If you can increase your conversion from one in ten to two out of ten, you can double your sales and increase your profits.
The number of interested people that convert and become customers is reflected by both the marketing and the sales efforts of your business.
Look at each site in your marketing and sales process and find ways to make small improvements to each site. A small improvement in each key area can result in a huge improvement in overall sales performance.
Depending on the marketing and sales process you use, procuring mobile-friendly sign-up forms, participating in sales training, or setting up automatic stakeholder follow-up function are examples of small improvements you can implement.
Increase the number of transactions per lead
A smart trick to increase profitability in the training business is to get your customers to book your courses more than once. Not only is it cheaper for you to resell (because you already convinced them that you are a safe choice), but it is also easier (the customer knows you and already trusts you). You just have to give them a reason to buy from you again!
Need tips on what you can do to get your customers to book training from you repeatedly? Click here to get seven effective campaign ideas to get past participants back on your training.
Increase size of sales
Once you have convinced someone that they should buy courses from you, you should also take advantage of the opportunity to get them to buy more than one training and/or register only one participant.
To achieve higher profitability through increased sales volume, you can, among other things, offer package prices for customers who want to buy several courses at a time. You can also do this by offering a discount if someone buys more courses or registers multiple participants at a time. Just make sure that you do not lose your profits through this type of action.
While this can be done both for providers of training in the private sector and the corporate sector, it is probably easier for providers who focus on training for the corporate sector to achieve major profitability effects with this method.
Increase your prices
Yes, I know, price can be difficult.
Many people are afraid of losing customers if they raise their prices. But if your margin is 50 percent today, a 10 percent increase in price means you can lose as much as 17 percent of your customers without losing money.
Also: In many situations, you can increase your prices by 5 or 10 percent without experiencing market resistance. If your training are of good quality and your offer is unique enough, a small increase in price will not cause your customers to disappear.
In other words, if you are going to raise your prices, make sure you differentiate yourself from your competitors in ways other than price. You can do this either by offering superior value, by “going the extra mile” or by reducing other costs associated with buying courses; such as the effort and time it takes to sign up and attend your training.
Reduce your expenses
The points above essentially involve increasing the cash flow into the training business.
But, in order to increase the profitability of your training business, you also have to watch out for how much money goes out.
Therefore, it is important to eliminate unnecessary expenses that do not add any value to the business. In other words, you should get rid of all the invaluable elements in the business.
Invaluable elements can involve many things. Many training companies have unnecessarily high costs associated with cancellation of courses, either when the company decides not to hold a training itself or when participants do not show up for training. If you do not have good systems in place, you end up paying for functions you do not use or repaying participants who would rather appreciate a voucher.
Cut out the invaluable activities and your business will be more profitable.
Also read: Avoid paying for premises you don’t need
Reduce Cost of Customer Acquisition
By this we mean the amount you have to pay for each paying customer you acquire.
You should constantly look for creative ways to improve your advertising and marketing, so that it costs you less to buy each customer. For some, it is enough to optimize their current measures, whilst for others this will mean a whole new strategy.
Doing so can dramatically impact and increase the profits of your business.
Get new partners
A strong network of partners can help you make your business more profitable in many ways.
Partners can, among other things, help you enter new markets, regions and industries, enabling you to grow in areas where your business may not be known before. Additionally they can offer a new channel for selling your training.
Are there providers of the same type of training that you offer, which are located in other regions or countries that you would like to work with? Or do you know of someone who sells products or services in the same category as you, who might benefit from a collaboration where you front each other’s brand on their own websites?
Attend a training yourself
Since you run a training business, you know very well how important training and courses can be and what a difference it can make.
Depending on your challenges, a training can help you see things in new light and teach you a thing or two that can help make your business more profitable.
Examples of courses that may be useful:
- Economy course
- Marketing Courses
- Sales Training
Also: By attending other people’s courses you will get inspiration for what your business should be doing to optimise its practice, thus, making you more profitable.
Choose suppliers that offer discounts
If you work with courses, you probably use a variety of digital solutions, such as a registration system, training administration, an LMS, a payment solution, a system for mail broadcasts and/or an image purchasing solution.
If you want to increase the profitability of your training business, you should definitely look for discounted prices for the solutions you use today, or possibly other solutions you might consider switching to.
Some suppliers offer package prices if you purchase multiple solutions and/or modules from them. That’s great – but only if you actually need all the solutions/modules.
Sometimes it can actually be advantageous to choose suppliers that allow you to remove modules from the package you choose, so you don’t have to pay for functions you don’t really need.
Others offer discounts based on your business turnover. If your turnover is small, this type of discount is gold!
Another type of discount that you may be looking for is referral discount. This means that you get a discount on your solution by referring your customer to the development company behind your solution and adding to their customer portfolio.
Get rid of your time stealers
Time is money. By getting rid of your biggest time stealers, you will suddenly have more time for the value-adding activities that actually help make your business profitable.
Not sure what the biggest time stealers are in your business? Check out the blog post “The 6 major time stealers for training providers – and how to avoid them“.
Work continuously on improvement
If you continuously strive for improvement in all of these areas of your business, you will earn more money, increase your profitability and contribute to the future financial success of your business!
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Author: Eline Hagene
Inbound Marketing Manager
Eline produces content to help training providers achieve a more efficient and profitable course day. She is certified in the Inbound methodology through Hubspot and has completed a Bachelor of Marketing management at BI Norwegian School of Management. Visit Eline’s LinkedIn profile here.
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