Your finances are undoubtedly going to be at the heart of your business. You might have a specific mission statement; you might have a close relationship with your clients and customers. But at the end of the day, all of those things require money to achieve.
Without money, you don’t really have a business, at best you have a very expensive hobby. The problem is that far too many small businesses waste huge amounts of money on things that could easily be avoided simply because they aren’t paying close enough attention to the little details.
Think of your business as a ship. If your ship springs a leak, you can’t do anything until you’ve plugged it up. So here are three ways that your business could well be leaking money.
This is a problem that most small businesses end up having. All too often, they assume that if they spend more money, their marketing will be more effective. This couldn’t be further from the truth!
In fact, if your marketing isn’t being targeted effectively then it won’t matter how much money you throw at it, it’s just going to end up as a waste of energy and resources. The most effective thing that you can do is to figure out who it is that you actually want to market your product to.
Who is your target customer? Until you know that, you’ll never be able to create a well thought out marketing strategy. Instead, you’ll just end up throwing money away on marketing that doesn’t bring in nearly as many customers as it would take to justify the cost.
#2 Equipment maintenance
Every business needs equipment and there’s no doubt that that equipment will need to be carefully maintained. However, the sheer cost of both time and money on keeping things up and running can be a serious issue.
It’s often far better to invest in equipment that can be consistently efficient and cost-effective. Things like rotary shaft seal design can ensure that contamination is kept to a minimum and both your equipment and your products are protected.
That way, you can get on with the things that matter rather than having to fix or replace equipment every six months.
#3 Growing too fast
Growth is obviously a very important part of any business. The problem is that a lot of businesses consider it to be so important that they forget to grow their business in a stable, sustainable way.
Instead, they end up doing things like taking out loans that they might not be able to pay back or taking on investors who will have overly high expectations. Things like this can end up costing your business far more money than they can make. The important thing is to let your business grow at its own pace, that way you don’t end up with a business that can’t actually support its own costs.
The reality of running any business is that you’re likely to always feel as though you’ve got a whole lot of plates spinning at once. However, if you plan carefully and prioritize your workload, you can prevent them all from crashing down around you.