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Starting a new business is exciting, adventurous, empowering, and costly. It isn’t the fun part to talk about, but a new venture can drain your finances. Here are thirteen tips to take your new business from financial drain to financial gain.
- 1. Hire An Accountant
- 2. Invest In An ERP
- 3. Make The Most Of Advertising
- 4. Eliminate What Doesn’t Add Value
- 5. Speed Up Your Process
- 6. Charge A Profitable Price
- 7. Focus On High Yields
- 8. Make It Short And Sweet
- 9. Increase Your Number Of Returning Customers
- 10. Choose Your Winners
- 11. Outsource Where You Can
- 12. Lower Your Overhead
- 13. Break Out Your Negotiation Skills
1. Hire An Accountant
Part of the fun of starting a business is being in charge, but that doesn’t mean you have to do everything yourself. When it comes to major financial decisions, DIY isn’t the best approach. Here’s why you should hire an accountant.
- Their tax expertise can save you a lot of money. They’ve helped out businesses like yours before, so they know what to do.
- They save you time. You can spend countless hours trying to learn the complexities of tax law yourself, or you can hire someone who already knows their way around.
- They can determine where you’re losing money and help you come up with a better system.
- They give you peace of mind. You won’t be asking yourself where you put the receipts or stressing over what happens if you make a mistake.
Save yourself time, money, unnecessary stress, and potential financial losses by letting an accountant handle your financial situation.
2. Invest In An ERP
ERP stands for enterprise resource planning. It’s essentially an application that handles your day-to-day operations so you can focus on what’s most important. Here’s why you should get one.
- To help streamline your financial management, product management, and customer relationship management.
- To give you more time to focus on your next big project or idea.
- To improve efficiency in your business, which leads to less financial waste.
If you want to save time and money, JDE Software can provide you with an ERP application that they maintain to ensure you’re always up to date.
3. Make The Most Of Advertising
Advertising is what sells your business so that you can sell your products. You can’t ignore such a key component, so here’s how to make the most of your advertising.
- Choose the right social media platforms. Using social media is an easy and effective way to get the word out about your company while keeping control of the narrative.
- Post original content that’s entertaining and indirectly explains what you do.
- Limit your selling posts. Only about 20% of your content should be directly selling what you do.
- Publish ads in relevant magazines and papers.
- Meet with your marketing team to create a fun new ad campaign designed to get new customers curious about your company.
- Make ads that don’t look like ads. You want people to be drawn in without realizing it.
Advertising can be expensive, so make sure it’s doing enough work to pay for itself in the end.
4. Eliminate What Doesn’t Add Value
The fastest way to prevent financial drain is to eliminate what doesn’t add value to your company.
Here are a few questions you can ask yourself to determine if you might be experiencing a financial drain.
- Do you have any equipment you don’t need? Unused equipment costs money to maintain and store.
- Do you have more employees than you need or can afford right now?
- Have you looked for the best deals on necessary expenses? If not, give it a try and see if you can lower your company’s monthly bills.
- Do you have space you don’t need? Not every business needs a physical office or storefront.
Look into these areas and see if you can eliminate what doesn’t add value to your business.
5. Speed Up Your Process
Look for ways you can cut down on the amount of time it takes to complete a product.
- The faster you can have a product ready, the sooner you can sell it.
- Unnecessary production time leads to paying for more work hours.
- Customers like to know their product will arrive quickly. Faster production and shipping times lead to more sales.
Do what you can to speed up your production process without sacrificing quality. Process mining tools like Apromore analyze business processes using data extracted from the system. Process mining allows business users to identify and discover opportunities to optimize performance and to maximize positive business outcomes.
6. Charge A Profitable Price
Charging a profitable price doesn’t mean making your customers overpay. It means:
- Calculating how much time and effort went into your product and considering that when setting a price.
- Making sure you receive an appropriate return on the time and effort invested.
- Ensuring that you’re making enough money to pay your business costs while still making a profit.
You have to consider the big picture when setting your prices. If you go too high, people may not buy from you. If you go too low, you won’t make enough to pay your bills.
7. Focus On High Yields
High-yield should be your company’s motto. You want a high-yield of profits, customers, and quality work. Here are a few ways to make sure you’re getting a good return on all of the above.
- Put money into a high-yield saving account for your business. It’s a great way to create an emergency fund that gains interest by just existing.
- Invest time in maintaining good customer relationships. This will pay off in continued sales and support.
- Prioritize doing quality work. Quality work is appreciated and shared by your customers. One piece of quality work can yield hundreds of new potential customers.
Put high-yield practices into place in your business to ensure financial gain.
8. Make It Short And Sweet
Customers don’t like complicated processes. You need to make their interaction with you as short and sweet as possible.
- Have ads lead directly to where your customer can purchase your product.
- Make information easy to find.
- Provide lots of customer service options, such as phone calls and chat.
- Make the buying process as quick as possible.
- Get the product out the door immediately.
- Thank the customer with discount codes or purchase rewards.
Customer service should be fast, easy, and accurate. Don’t overcomplicate the process.
9. Increase Your Number Of Returning Customers
It costs less money to retain a customer than to attract a new customer. Focus your customer service on customer retention.
- Provide the same level of service every time.
- Reward your regular customers.
- Resolve complaints in a timely and apologetic manner.
- Make it clear that each customer matters to you as an individual.
- Create an easy returns and exchanges policy.
Your customers are your most valuable asset. Keep them happy and coming back for more.
10. Choose Your Winners
Don’t waste money focusing on a product or employee that consistently doesn’t do well. Choose your winners.
- Focus your sales efforts on products that continuously have a high sales record.
- Invest in training and keeping talented employees.
- Promote employees with excellent sales records to higher positions with more responsibilities.
- Eliminate products and employees that are no longer beneficial to your business.
You don’t want to continue losing money on something that isn’t working. Don’t be afraid to go back to the drawing board or do some hiring.
11. Outsource Where You Can
Outsourcing departments and positions that you don’t need regularly can save you the cost of paying a full-time employee.
- Eliminate any in-house positions that aren’t regularly needed.
- Hire freelance artists to handle your designing needs. That way, you won’t be paying them to hang around when you don’t need them.
- Pay a freelance web designer to create your website. Chances are you won’t need them again for at least a few months.
Assess your business, and determine what positions may be unneeded.
12. Lower Your Overhead
Do you need a physical space? Can some of your employees work from home? Those are just a few of the questions you can ask yourself to determine if you’re paying unnecessary overhead costs. Here’s what to do about it.
- Don’t buy or rent space you don’t need. That includes office and storage space.
- Determine who can work effectively from home. You may discover that very few people need to be physically present.
- Look for better prices on your raw materials and shipping materials. Lowering the cost of production and shipping can drastically lower overhead costs.
Running your business as affordably as possible allows you to put more profit back into it and your pockets.
13. Break Out Your Negotiation Skills
Maybe your new business started out as a side hustle job, but now that you’ve turned it into your full-time job, it’s now time to manage your finances differently, and negotiations are a great and effective way to lower your business costs. Do you have the best price on the materials and services you need to stay in business? If not, these negotiation tips may be able to help.
- Research the market so you understand what the best deal you can get is.
- Hire an experienced negotiator to argue on your behalf.
- Create a list of what you want and what you’re willing to trade to get it.
- Be willing to walk away. Sometimes just threatening to go to a competitor is enough to make someone give you a better deal.
- Revisit the arrangement often. Sometimes re-negotiating can get you a better deal than you had originally.
Don’t be scared to ask for a better deal. You won’t know until you try.
Put these 13 tips to work at your new business and watch the financial gain come rolling in.
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