5 ways to increase revenue and protect your margins

Published Thursday 2 April 2026

Table of contents

• 1. Encouraging more purchases to increase revenue
• 2. Finding new customers
• 3. Expanding your range of products or services
• 4. Upselling to increase revenue
• 5. Lifting prices to increase revenue
• The problem with increasing revenue
• How not to increase revenue
• Increasing revenue is only half a job
• FAQs on increasing revenue

Key takeaways

• Focus on encouraging existing customers to buy more often or spend more per transaction, as the likelihood of successfully selling to an existing customer is 60-70% compared to just 5-20% for new prospects.
• Avoid heavy discounting as it destroys margins quickly - if your business has a 30% margin, offering a 10% discount means you need to sell 50% more just to earn the same profit.
• Implement relationship marketing by staying in regular contact with customers through email or social media, sharing valuable content first rather than purely promotional messages to encourage repeat purchases.
• Consider lifting prices strategically, as a 5% price increase can boost earnings before interest and taxes by an average of 22% without requiring more customers or transactions.

1. Encouraging more purchases to increase revenue

Encouraging more purchases means getting your existing customers to buy more often or spend more per transaction. This is often the fastest way to increase revenue, as the likelihood of successfully selling to an existing customer is between 60–70%, compared to just 5–20% for a new prospect.

Adding new customers matters too, but maximising sales from your current base makes every future customer worth more as well.

Make buying easy

Take away any obstacles that might prevent people from buying. Here are a few ways to reduce friction:

• Offer online ordering: Let customers get what they want without travelling or calling
• Set up standing orders: Regular customers receive products at agreed intervals without reordering
• Accept card payments: Customers can buy on credit while you get paid straight away

Customer-friendly billing

Customer-friendly billing aligns your payment terms with how your customers manage their cash. Spreading payments over time makes it easier for them to fit you into their budget.

Billing models that encourage repeat business include:

• Flat fee billing: Predictable costs customers can plan around
• Retainers: Ongoing arrangements that secure regular revenue
• Subscription billing: Automatic recurring payments that reduce decision fatigue; research shows that annual plans can reduce churn by 40% compared to monthly billing.

Relationship marketing

Relationship marketing keeps your business top of mind by staying in regular contact with customers through email, social media, or other channels.

The goal is to encourage repeat purchases without overwhelming your audience. A few principles to follow:

• Add customers to a database or social network: This lets you share relevant products, services, or news
• Balance frequency carefully: Avoid spamming or clogging their feed
• Deliver value first: Share content that's useful or entertaining, not just promotional

Sales promotions

Sales promotions encourage spending by offering extra value to customers. The challenge is boosting sales without destroying your margins.

Straight discounting eats into profit quickly. A smarter alternative is bundling:

• Discounting: Reduces margin on every item sold
• Bundling: Spreads a smaller discount across multiple items, so you still earn full margin on most of the sale

See "How not to increase revenue" for more on the risks of heavy discounting.

2. Finding new customers

Up your referral game

Referral marketing turns satisfied customers into advocates who bring in new business. Good customers tend to refer people like themselves, so referrals often lead to more good customers.

Data confirms that the lifetime value of referred customers is 16% higher than that of customers acquired through other channels.

Build a referral request into your regular customer communications. This simple step can kickstart a word-of-mouth engine that keeps working over time.

Service businesses often see the biggest impact, but referrals work for retail and hospitality too.

Experiment with marketing

Experimenting with marketing means testing new channels and shifting spend when returns start to flatten. Every tactic eventually reaches diminishing returns, so ongoing experimentation keeps your growth on track.

Low-cost ways to test new approaches include:

• Social and digital marketing: Run small campaigns to gauge response before scaling
• Sponsorships: Back community projects, local events, or sports teams to build loyalty in your area

Monitor your return on investment and reallocate budget when a channel stops delivering.

Grow your footprint (in real life or online)

Growing your footprint puts your business in front of new audiences by expanding where or how you operate.

Options to consider:

• Open a new location: A second shop or office reaches a fresh pool of customers, though setup costs can be high
• Sell online: Reach a wider audience without the expense of a physical space
• Deliver services remotely: Many professional services can be offered online, expanding your reach without travel

3. Expanding your range of products or services

Expanding your product or service range means adding new offerings that complement what you already sell. Done carefully, this can increase revenue without overextending your resources or taking on major risk.

Diversify your products and services

Diversifying your products and services adds new revenue streams without changing your core business. Here's how to start:

1. Ask your customers: Find out what else they'd like to buy from you
2. Research competitors: Check what similar businesses offer and look for gaps you could fill
3. Consult suppliers: Retailers can ask suppliers for ideas on complementary products
4. Start small: Test new offerings with select customers or in limited displays before committing to large orders

Adding new products or services can increase costs and admin, so scale gradually.

Offering more without actually offering more

Repackaging your existing offer lets you reach new audiences without adding new services. You simply position what you already do for a different market.

For example, a landscaper serving single-family homes could pitch the same services to holiday homes, retirement villages, or public venues. The work is identical, but the packaging opens new doors.

4. Upselling to increase revenue

Upselling moves customers towards higher-value products or services with better margins. The goal is to increase the value of each sale without being pushy.

Tactics to try:

• Position premium options visibly: Place higher-spec products next to cheaper alternatives and highlight the extra features
• Understand customer priorities: Tailor your pitch to what matters most to them
• Offer introductory deals: Let customers experience premium benefits before committing to full pricing
• Add complementary services: Training, maintenance, or support packages create extra revenue and strengthen relationships

Test your messaging with a sceptical friend to make sure it doesn't come across as pushy.

5. Lifting prices to increase revenue

Lifting prices increases revenue per sale without requiring more customers or transactions. Done carefully, it protects your margins as costs rise; one study found that a 5% price increase can increase earnings before interest and taxes (EBIT) by an average of 22%.

Here's how to approach a price increase:

1. Understand your current margins: Calculate the difference between what it costs to deliver your product or service and what you charge
2. Account for inflation: Your margin has likely shrunk since your last pricing change as costs have risen
3. Set a sustainable target: Decide on a new margin that covers costs and supports profitability
4. Get expert input: An accountant or bookkeeper can benchmark your margins against industry norms

Calculate your business's current margin with our gross margin calculator.

For service businesses, reviewing margins reveals where past estimates went wrong. Often the same aspects run over budget. Build those costs into future quotes instead of absorbing them.

Read more on raising prices, including how to communicate changes to customers, in the guide How to increase prices.

The problem with increasing revenue

Revenue growth comes with costs. More sales can mean more expenses, so it's worth understanding the trade-offs before scaling up.

Higher operating costs

Higher operating costs often accompany revenue growth. Common expenses include:

• Inventory: More stock to meet increased demand
• Staffing: Additional employees or freelancers
• Marketing and sales: Bigger budgets to attract and convert customers

Plan how you'll cover these costs while waiting for the extra revenue to arrive.

Extra capital investments

Extra capital investments may be needed to support growth. These can include new tools, equipment, additional locations, or software.

Before committing, consider:

• Total cost: How much will the investment require?
• Funding source: Where will the money come from?
• Payback period: How long until the investment pays for itself?

Oh, and more work

More work comes with growth. Higher output often means longer hours, new hires, and additional management responsibilities.

Ask yourself: do you have the capacity for these commitments? If not, consider whether improving profitability might be a better path than chasing more revenue.

How not to increase revenue

Heavy discounting destroys margins faster than most business owners realise. For example, if your business has a 30% margin, offering a 10% discount means you have to sell 50% more just to earn the same profit. A modest-sounding discount can wipe out your entire markup:

• 20% discount: Eliminates a 25% markup
• 25% discount: Eliminates a 33% markup
• 33% discount: Eliminates a 50% markup
• 50% discount: Eliminates a 100% markup

Instead of straight discounts, consider bundling. You discount one item but earn full margin on the others in the bundle.

Increasing revenue is only half a job

Revenue growth only matters if profit follows. Most small businesses searching for ways to increase revenue really want to increase profits. There's no point building sales if the extra cash doesn't reach your bottom line.

Your costs will rise as you grow. The goal is to keep them from rising as fast as revenue. Track your margins carefully to make sure they stay intact or improve through economies of scale.

For more on protecting your bottom line, see the guide How to increase profits.

FAQs on increasing revenue

Still have questions about growing your business revenue?

What does it mean to increase revenue?

Increasing revenue means bringing more money into your business through sales, services, or other income sources. It's the total amount customers pay you before subtracting costs.

What are the four ways to increase revenue?

The four main ways to increase revenue are: getting more customers, encouraging existing customers to buy more often, raising your prices, and expanding your product or service range.

How do you increase revenue in practice?

Start by identifying which strategy fits your business best, then set measurable goals and track results. Test small changes, measure what works, and scale the tactics that deliver returns.

Is an increase in revenue always good?

Not always. Revenue growth can strain cash flow, increase costs, and demand more of your time. Make sure the extra sales translate into profit, not just more work.