Thread by @joshuamschultz

Turning expenses into revenue is a great way to

1. lower costs and raise margins
2. expand the business
3. develop capabilities
4. grow market share

Here is how it works....

There is a great cycle that really led my supply chain companies for over 10 years

- next level of customer requires service which requires new investment
- new investment increases our capabilities
- new capabilities allow us to capture new types of customers
- repeat

The problem with this cycle is the investment needed. This can often be quite high for a small business.

Here is a way to handle that...

1. Consider the equipment, location, person, training, certification, or whatever investment you need to make.

What company could you build around that, if it was your only resource?

2. Call around to all your current customers, see if they are interested at all in a vendor with those services.

This is testing the market for interest

If so, test non-customer interest.

3. If interest exists, scale-out a new sub-page of your website with some type of order or call to action for that new sub business.

4. Make the investment in order to serve the original purpose you had in mind.

5. Launch the additional services in order to generate additional revenue.

Make sure you price this correctly, or you will

a. detract from your core business and wont be able to scale
b. will just be trading time and losing focus

6. Update your core business sales content to include your new capabilities

7. Go after the new/next level of customer with your increased capability.

An example: We were getting quotes for parts outside of our ability to inspect and perform quality checks. Calipers and Vision machines were no longer enough.

A CMM was a 70,000 USD investment...

We built out a 3rd party quality service for firms that didn't have proper quality equipment, but need a CMM to verify their parts.

We got 3 major benefits
1. Profit from the venture paid for the machine in year 1, the rest was upside

2. We got to see what parts were being ordered by companies that we didn't supply and tailor our pitch

3. We gave quality incentives for growing the internal startup