How can you make your business as profitable as possible?

One key principle is getting paid more than once by providing a subscription service. Just think: with just 400 subscribers, a $20-per-month subscription will bring in close to $100,000 every year! Bizarre sounding businesses like the Cupcake of the Month Club exist because this model is so profitable.

A second key factor is pricing: make sure your prices are based on the benefits you provide, not the cost of producing a service.

Gary Leff, the travel consultant, who books trips for his customers using their bonus miles, charges a flat fee of $350 per booking regardless of whether it took him 5 minutes or 5 hours.

This is because the benefit to the customer is the same.

On a similar note, don’t hesitate to periodically raise your prices.

Quite often customers react far more positively than you’d suspect, the tone being, “It’s about time. You’re worth much more than you charge!”

Also, to further maximize profits, give customers a limited range of price rather than a single one.

You don’t want to confuse people with a dozen options, but some people always want “the premium edition” of everything, so why not give them a spruced up version of your basic product with a heftier price tag?

Once your business is up and running, you must continue to fine-tune or “tweak” it for optimum profitability.

The main areas to focus on are: traffic to your website, conversion from visitors to customers and the price of an average sale.

These metrics each have a huge impact on your bottom line; therefore, you must keep experimenting with small tweaks (e.g., to your website copy) to find out what brings in the most profit.

Get paid more than once, price your product ambitiously and use small tweaks to make a big impact in profits.