Last Updated on December 9, 2020 by admin
Your business is finally making some money. What should be your next move? A wise business owner would do only one thing, and that is to use that money for growing the business even more. But doing so isn’t as easy as it sounds. You need to adopt some steps to reach the goal of making your business big in the next few years. Here are some ways on how you can do this.
Spreading Out Payments
When it comes to paying bills, you need to make sure that you’re not paying everything altogether as this practice can put you in a difficult situation financially. Pay them close to their due dates and avoid paying them late at all cost to avoid being charged extra bucks on late fee or interest.
If the vendor contract can be extended up to 90 days then that would be great. Some billers offer a discount for early payment so make sure to pay your bills before the due date. Prioritize paying the more important bills such as office rent and payment for your workers. After doing so, you can settle the less important ones.
Practice Diligence in Payments
You can improve and keep cash flowing into your business by giving incentives to customers who pay early. You surely have experienced such from your billers and vendors and it would be a good practice to apply to your customers as well. Offer discounts to those who are diligent in paying early.
You can also take measures like requiring customers to make a deposit whenever they order something or use a service that you’re offering. Customers can do so without any hassle by using their credit cards anyway so don’t hesitate to do it.
You can also create invoices through electronic billing and most can be customized to cater to your business needs. Setting up payment reminders that are automatically sent to customers on pre-determined dates is also possible.
Apply Wisdom in Credit
Credit is good when you give it to people who can pay it back for sure. Don’t extend credit to just anyone. Unpaid orders can be detrimental to small businesses so be sure to write a clear set of guidelines that determine who are eligible for a credit.
Next, you need to be strict in implementing it. New customers must undergo a credit check. Avoid the mistake of extending credit to anyone who expresses interest in your product or service. For those who pay late, mark them and be sure to offer your other payment options so they can settle their dues on time.
Setting them up on a payment plan is a wise move. By doing so, you are automating the payment collection process since they are automatically charged according to set dates.
Manage Payroll and Revenue Well
Managing these things depends on the type of business that you are operating. If you own a restaurant that earns money every single day then you can easily settle payroll for your employees every week. The case is different and usually more difficult for manufacturers so developing an efficient revenue calculation and payroll management system for your business is crucial.
Think and Plan Ahead
As a business owner, you should always make sure that you’re one step ahead of everything. Always assume that the unexpected can happen anytime. Your cash flow may fluctuate and overhead expenses might rise up. Be sure to save for the lean months and try to reach an amount that can help support the business and keep it running for up to 3 months.
With this amount of savings, you can be sure that your business will survive even through different kinds of emergencies. And while you’re trying to get the business up and running, you can use your business line of credit or a credit card to pay for essential stuff.
In time, you’ll be able to establish a more stable cash flow and once everything is back to normal, be sure to execute close monitoring on expenses by viewing it through online banking or getting a copy of it from the bank. Establish a system that can forecast cash flow. Get at least a year’s forecast of the money that’s coming in and going out to help you plan things ahead of time in terms of marketing efforts and other business stuff.
Grow Your Business With The Help of Employees
Owning a small business and making it run requires much time. You will be doing a lot of things mostly by yourself at the first stages. As you do this, you could be losing precious time that you can spend on the things where you really excel at. If you want to see your business grow, you need to make sure that it’s the core matters that you’re working on.
Ger the help of contractors and freelancers to take care of the mundane tasks required to run the business. It might feel hard at first to let loose of these tasks you used to work on by yourself but if you really want to make your business grow bigger then you need to do it. Be sure to bring in knowledgeable people who can contribute their expertise in the job you’ll be giving them
Join Ventures With a Larger Business
Given the small business that you own, partnering with a larger and a more established company may give much traction. You can take advantage of the established business footprint that they already have and the proven strategies they’re using in growing business.
They’ve also got more than enough resources to make growth and progress happen. This can change the name of the game for you big time! The resources include good reputation, manufacturing facilities or equipment and as well as distribution channels. Most of the time, it’s easy to negotiate with larger businesses and it’s a sure way towards growing your own.
A merger is also a good idea. Whatever are the ideas that you have in mind for growing your business, be sure to give enough attention to your finances. Be wise in your expenditures and stock up some savings for emergencies. Also, you need to make sure that you’re being rewarded monetarily for the work that you do.
The ways in growing your business which is listed above aren’t the only ones available. Different entrepreneurs will have varied methodologies. It also depends on the kind of business that you have to be creative and innovative enough while maintaining an open mind for the changes that might be needed as you strive to make your venture grow into a big one.