Leaving money on the table is a popular idiom, especially in business. It means the possible lack of profit that someone is leaving behind. It happens because the business may be unaware of why and how it is leaving money behind.
If you think you are working hard enough and still not making up the losses, you are probably making unrecognizable mistakes. For example, you might be wasting resources or missing opportunities that are adding to the lost profit.
This article points out how you are leaving money on the table. It will also reveal some ways to rectify this situation. Let’s start!
The Meaning Behind Leaving Money on the Table
Let’s dive deep to understand the meaning of leaving money on the table. Well, to simplify, anyone can leave money on the table.
You can leave the money behind even if you are not charging enough for your freelancing services. Similarly, you can be at a loss if you do not recognize your potential and negotiate at lower terms.
However, here we’re looking at this phrase in the context of business. So firstly, you can lose profit if you are pricing your product lower than it should. The same goes for the hospitality industry when the cost exceeds the service charges. For example, menu pricing is a critical part of successful restaurant management.
However, this term is not specific to selling products or services. Let’s take an example of a house registered on Airbnb. If this hotel management is not maintaining its online presence and neglects optimization, they are leaving money behind.
Similarly, a restaurant owner that does not promote offers for the holiday season is far from reaching its desired revenue. These are a few reasons why digital marketing is important for small businesses.
There are endless examples of how a specific business can lose money just because of a mistaken strategy. You can understand the concept and apply it to your situation to analyze if you are making the same mistakes.
8 Mistakes You Might Be Making That Are Leading To Missed Opportunities
Now that you understand the meaning of leaving money on the table, you might be thinking about your mistakes.
If you leave money on the table, you get into a major loss. It is impossible to modify that mistaken step if you do not realize where things went wrong. Besides, even if your earnings are good, it’s better to look after your retirement plan than to leave money behind.
Therefore, recognizing the problem is crucial to make a coping plan. Once you know the issue, you can stay vigilant and protect your business from drowning.
In the proceeding sections, you will learn about the common mistakes that could harm your business. You can learn and plan according to your situation.
Mistake #1 That Leads To Leaving Money on the Table: Entering the Price War
The price war starts when different businesses in the same industry keep lowering the product or service price. You may think this helps gain more customers, but from a rational perspective, you are at a loss.
Lowering the price of your offering is not a sustainable solution. When the cost of your product or service increases daily, you have to regain that cost money.
Moreover, a business is successful as long as it makes profits. But lowering the price keeps you from getting a profit, so you often generate low revenue.
Therefore, use Break Even analysis if you fear leaving money on the table and losing customers because of pricing. This analysis will tell you the output you need to make a profit.
But don’t worry. This general rule applies to every business. If you have a restaurant, price the menu by estimating the profit you will make.
Similarly, negotiate better terms if you run a retail business or you operate in the field of supply chain logistics. A price war also happens when you are afraid of saturation and competition in the market. Don’t fall for the bait because lowering pricing in a competitive industry decreases the credibility of your product. Instead, differentiate your business with proper marketing campaigns and excellent customer service.
Mistake #2 That Leads To Leaving Money on the Table: Refraining From Following Up
Following up is a pillar for customer interaction because customers leave if you don’t answer their concerns.
Sometimes, people need just a little push to make a purchase. Therefore, if you don’t follow up, you’re leaving money on the table. Also, engaging with your customers after the sale, increase the chances of selling more and bringing in extra cash.
Additionally, following up provides an opportunity to learn the needs of consumers. If you do not build a relationship with your buyer, you won’t be able to improve your service.
Moreover, it gives you a chance to get referrals and recommendations. This referral system plays an important part in digital marketing and is one of the major strategies for generating traffic. If you are following up with your customers and addressing their concerns, you will open a path to recommendations. Therefore, keeping up with communications is something you can not neglect.
If you think you’re leaving money on the table, you might be ignoring your customer preferences. After following up, the best thing to do is to answer your customer concerns. Why would anyone avail of your service if you are not fulfilling their needs?
Your consumer is the asset that gives your profit. Therefore, ignoring customer feedback isn’t a wise decision. If you turn them down, you leave money on the table. That’s why reviews are important.
For instance, you must improve if you are a product seller and your customer gives negative feedback. Don’t just sit there; prove your product’s efficiency and get back to your customer.
Similarly, if someone is eating at your restaurant and they do not like your manager’s attitude, try a better approach. Make your diner feel comfortable and ensure to answer their questions.
Moreover, if you run a small online business and your reviews are negative, you must take those feedback seriously.
As mentioned, the rule of following up has equal value for a small industry to an extensive commercial establishment. Not following up will give an advantage to your rival business, which is improving customer service.
Isn’t it a straight loss of consumer insight and profit? Not following up also gives your brand name a negative reputation that has lifelong effects.
Mistake #4 That Leads To Leaving Money on the Table: Ignoring Extra Features and Upgrades
Upgrading is human nature. Hence, improving your product or services is never a bad idea. When you look at the competition in the market, you want to stand out to gain organic traffic. Upgrading is helpful in this regard.
If you don’t opt for improving your offerings, your customer will end up in your competitor’s place.
Not upgrading has a direct effect on leaving money on the table. People are always willing to pay more to get premium services. Not using this to your advantage is a drawback.
Therefore, stop and replan if you think you are making this mistake. The business landscape is growing so fast that there is an extra feature and upgrade every day. If you fail to match the level of the latest trends, you are out of business.
Mistake #5 That Leads To Leaving Money on the Table: Not Marketing Correctly and Often Enough
Incorrect marketing is the next mistake that may lead to leaving money on the table. Many ways are not correct or enough for marketing and cause sales loss.
If you’re not communicating with the audience, you will eventually lose them. Also, there are multiple channels to brand your services and products. Not utilizing these channels is a huge flaw.
If you want to rectify this mistake, use the following channels for effective marketing.
- WiFi Marketing: The Internet is a source to connect the world. Therefore, it is the first thing your customer will notice. Providing free WiFi at your venue will attract a larger audience. But that’s not all. Because you can use a captive portal to market your products and services, it is the page your customers will see when they log in or out of your free WiFi. Use WiFi marketing solutions to scale your marketing operations.
- Email Marketing: If you have to create product and brand awareness, email marketing is for you. It is about sending personalized promotional emails to engage with your customers.
- Social Media Marketing: Use apps like Facebook and Instagram to collect an audience and build a brand. This is particularly important in the hospitality, clothing, and cosmetic industry.
- Google and Amazon Ads: These are two online advertising platforms, perfect for letting the world know about your services and products.
- Traditional Marketing: The world is advancing, but that doesn’t mean traditional marketing is dead. There are still people who trust these mediums even more than digital marketing. Therefore, you should also use TV and print ads, billboards, etc., to your advantage.
These are some means of marketing that will be beneficial in improving customer interactions and thus improve profit. Ensure to understand which ones suit your business better and start to use them.
Mistake #6 That Leads To Leaving Money on the Table: Being Afraid To Ask
Have you ever wondered why waiters in respectable restaurants always ask what you need? That’s because they want to encourage you to order. Sometimes people leave a restaurant if nobody approaches them since they expect hospitality.
Therefore, if you don’t initiate these small steps in your restaurant, you won’t be able to make a brand. Likewise, if you have an online business, a clothing brand, or a shop, not approaching your customer isn’t an option.
As a service provider, it is your responsibility to ask whenever you can. If you do not follow this practice, you will end up leaving money on the table.
There are various examples of businesses sending cold pitches, asking their customers if they need help solving a pain point. They’ve built whole empires on this. Sometimes, your customers don’t know what they need until you ask them.
Rectify this mistake and let customers know that you are a reliable establishment by asking about their needs and satisfaction. Most of the time, you’ll get great feedback that can translate into getting more reviews.
Mistake #7 That Leads To Leaving Money on the Table: Poor Communications
Underestimating and poorly advertising your product or service value is yet another mistake. If you do not explain to the customer the value of your product, they might not understand it. The inability to highlight the advantages of your offering is thus a cause of leaving money on the table.
An ineffective storyline plays a major part here. You need to convey the message with a relevant touch.
Using the consumer’s name and tailoring the message according to individual conditions is vital. If you want effective communication with your user, avoid using complex and technical language in messaging. Keep your communication terms simple so customers can focus on the products.
Mistake #8 That Leads To Leaving Money on the Table: Underestimating Discounts
Let’s conclude this list with an unexpected mistake. Discounts are effective in profit generation if you use them right. Remember, do not go on constant cost reduction. Instead, use seasonal discounts to boost sales. Why?
Because when a customer realizes that he is getting something at a lower price than the market, he pays attention. Use it to your advantage and put discounts on items that cost you less.
Moreover, putting a discount will draw a large audience, and you will earn customer loyalty. However, always calculate the invested money on expenses and profit margin before giving a discount.
Additionally, focus on short and limited offers because you will also need to compensate for the cost of the service.
Strategic discounts can prevent leaving money on the table and add to the value of your product or service.
Follow These Strategies and Don’t Leave Money on the Table
Leaving money on the table is one concern that you should not have. The strategies outlined in this article will help you improve your situation and get the most out of your business. Remember, investing in a retirement savings account is better than not earning money.
Therefore, don’t leave money on the table and take advantage of the opportunities your business presents to you.
If you want to scale up your marketing operations, try out Beambox WiFi marketing. Beambox allows you to grow your reputation on local review sites and automate your marketing campaigns.
Moreover, with Beambox, you can manage and secure your WiFi network with just a few clicks. Over 12,000 venues are using Beambox to scale their operations and grow their revenues. Start your free trial today!
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