Is your small business running into brick walls? Are you trying to tighten the belt, or plan for the next wave of new hires? No matter what you’re trying to achieve, there are steps you can take to get more done while trimming the excess fat – the right way.
First things first, you have to make a plan.
Think a few months out. As cliché as it sounds, this is a marathon, not a sprint. Understanding your financial picture takes time. You can’t look at just two weeks worth of money coming and going to make an accurate assessment of your whole financial picture.
If you need guidance on how to get your company in fighting shape, follow these steps and before you know it, you’ll be ready to hire those new folks, get a new sign for the building, and keep the cash flowing in the door.
Get together with your bookkeeper
When’s the last time you sat down to take a look at the books? Do you know how money is moving in and out of your company? It’s a good idea to see what you’re spending, as well as to note which customers are paying on time. Talk about your cash flow forecast! It’s important to know what could affect business decisions down the line. Ask smart questions, and take notes.
Get on the phone
Are some leads lingering on your desk? Make the time and give them a call. Maybe that long shot could become the client that changes everything. Don’t put off a call that could bring in new money.
Check the inventory
If you’re selling a good, is your stock up to date? Have you printed enough shirts? Did you buy enough tortillas for the weekend? Keep a constant eye on your inventory to avoid customers walking out of your shop empty-handed.
Don’t be cheap
Make room for annual bonuses and raises, even if they’re on the smaller side. If there’s one thing that always motivates employees, it’s money. No one likes working for a cheap employer because it drives morale into the dirt, even if the job is easy. If you’re known as a business that pays employees well, the staff will be happier and work harder because they know they’re ultimately valued.
Budget for help
Everyone needs help. You might be great at mowing lawns, but when it comes to bookkeeping, someone else is much, much better. Don’t try to do too much, and work with a professional for the things that matter. A certified professional will know all of the tricks to help you maximize your dollar when tax season arrives.
Remember the phrase “payment due upon receipt”
If someone owes you money, make sure you’re getting paid. Some companies love to stretch out payments to 30, and sometimes up to 60 days, which for a small business could mean life or death. Demand payment when you send off your invoice.
Get a line of credit
It’s a good idea to have a credit card for emergencies. If a three thousand dollar piece of machinery dies and you can’t afford a new one at that exact second, having credit to replace the downed machine can be the difference between making money and going broke. Get the credit card, and use it sparingly.
Study your trends
Make notes of times of boom, and times when it’s slow. If you’ve marked down a quiet couple of weeks in March, it might be a telling sign that spring could be your slow season. Notice you can’t keep items on the shelves fast enough in July? Summer might just be your peak season. If the weather impacts your business, plan for rain delays. Make sure to factor all of your trends into the overall business plan, too.
Buy in Bulk
If it’s possible, buy everything in larger quantities. Most wholesalers love when you buy more than one of what they’re selling and are keen on offering discounts for buying in bulk.
Keep tabs on the new teammates
If you’ve hired some new people, get to know them – don’t be just “the boss.” While the old school management style of being tough might have worked in the past, today, it’s a different world. Your team members will look to you for culture and leadership. Get to know your team, and lead by example to achieve the greatest success.
Spend money on marketing
No matter what line of work you’re in, you need marketing. You need folks to know about your business — where to find you, how to contact you, and what you offer. Don’t hire your friend from down the block to try to save a buck here. Well, unless they’re a seasoned marketing vet. Otherwise, remember what we said earlier: hire a pro to help you maximize your business.
Be honest with your team about how the company is performing. Communicate early and often. Don’t wait until something’s wrong to reach out to vendors. Sometimes vendors will work with you if you need more time to pay off a debt, which leads us to the next point.
Look, it’s a no-brainer, be nice to the people who you’re working with. Treating employees, vendors, and customers with respect goes a long way and will help you if you’re ever in a bind.
Start thinking about what’s coming down the line. Do you want to expand or open a second location? Plan a year or so out, start setting aside money, or find a contractor. Do the math now, so you’re not rushing later on.
Like we said before, this is a marathon, not a sprint. Making a plan is the first step, but how you implement that plan is what will set you apart from the rest. Setting realistic yet challenging goals, and being intentional in achieving those goals, is what will take your small business to the next level.
What are some ways you get your business into fighting shape? We’d love to hear! Drop us a line and let’s talk. We love learning more about what the ScaleFactor and small business community is up to. And as always, for everything else, check out the ScaleFactor blog.