Funding a Growing Business
Business owners should be looking into ways to reduce their companies’ financial stress by finding ways to pre-fund their companies’ growth. More than half of small businesses avoid applying for any kind of funding or financing through third parties, either because of high-interest rates, low funding amounts, or other requirements these businesses were unable to meet.
This is why many small business owners have turned to existing reserves or personal funding resources when trying to grow their companies. Unfortunately, small businesses have a difficult time finding or getting funding. Still, thankfully, all of those expenses can easily be covered earlier in the process through pre-funding, so when the business starts growing, everyone involved can reap the benefits and rewards.
Businesses can try capturing all of their sales opportunities, including increased prices by just several percent, which consumers don’t really notice, upselling or cross-selling their products or services, or, perhaps, most importantly, creating returning customers. One of the most lucrative ways to generate cash for businesses is to make the customers constantly satisfied with the company’s products or services, which is a strategy that easily promotes regular and repeats purchases.
Furthermore, these repeat purchases can also be further developed into referrals, where the consumers become bigger fans of the company and increase brand awareness through word-of-mouth marketing.
Another thing that most new businesses often overlook is how they manage the company’s cash flow. By improving the company’s management of funds, business owners can reduce their financial stress and find more funds on the way. Plenty of businesses who are just starting believe that they don’t have to look into the existing expenses that they can’t change, but that can’t be further from the truth. For example, some of the monthly business costs, such as utilities, rent, or technology, can easily be renegotiated, or the business can look into some lower-cost providers.
Business owners should look into any potential expenditures regularly – at least once or twice a year, and find all the little ways that money is flowing out of business, including increasing costs without added value, such as internet services or even marketing campaigns that aren’t actually working as well as they should be.
Financial efficiency for businesses is all about return on investment (ROI) and how well the company is using and allocating its resources. Most likely, some businesses are underutilizing at least some of their resources and can find more ways to cut costs. Any unused space that’s being rented can be sublet and turned into a new financing opportunity. There are plenty of automation technologies that help businesses complete certain tasks for a fraction of the cost faster.
Finally, if all of these options have been explored and traditional sources aren’t available, there are plenty of options for new businesses to get grants, loans, and general funding through different campaigns.