By Jacob Wilson on Sep 19, 2019 11:14:25 AM
You started your small business with little money but a lot of enthusiasm and dedication. Along the way, you learned that being an entrepreneur entails more than just a desire to succeed, so in time, you had to tweak your strategies and adjust your goals.
However, the most complicated aspect for most novices in the business world is finance.
It may be one of the most complex and nerve-wracking parts of your business but it is also the most unbiased indicator of your business success. If after revising it, you are not satisfied with your financial situation, it is time to make some changes.
With that in mind, here are some strategies that you might use to upgrade your business’ financial performance.
Expand your customer base
Common sense tells us that the more customers you have, the more income you will have. Although that is, for the most part, true, what is challenging in this situation is the approach you will take to increase the number of your customers.
For starters, what is important is that you know how to keep your current customers since customer retention is an essential part of expanding your customer base.
As for new customers, you can invest in different marketing tools to help your brand gain more visibility and in that manner increase traffic. But what is important is to find the balance between the money you invest and the amount you expect to get back by attracting more customers.
For this reason, current customers and word-of-mouth marketing combined represent an efficient and cost-effective tool to raise brand awareness and get new customers involved.
Boost the conversion rate
Increasing the traffic to your website is an excellent start but it is not enough. If your bounce rate is high, you need to analyze the situation and make some changes so you can convert those visits to paying customers.
So, what you should be aiming at are strategies to improve the conversion rate but without spending a fortune to achieve that.
Calls to action (CTAs) can be a powerful tool to get people to actually purchase the product instead of just reading about it. In this digital era that we live in, many people have developed the fear of missing out so enticing CTAs which offer discounts for a limited time only can easily lead to an increase in sales.
Naturally, you would have to find the right words and also make it all visually pleasing but this strategy doesn’t cost much and can turn out to be quite lucrative.
Being on a tight budget and working on improving it means that you have to be very careful with your expenditures but again, to generate more income, you need to invest something.
Investing in real estate can be profitable since although real estate’s value fluctuates, it always holds some value. So, the trick to get the best out of such a deal is to be patient and wait for the most suitable time.
Another important aspect is the location and, in this case, you should consider investing in a property abroad which you can rent and then either sell at a more convenient time or open a branch of your business once your finances are stable.
Since a different set of rules apply for foreigners in developing markets, it is always best to hire experienced local experts, such as Invest Islands investment firm, to help you acquire a property. They can introduce you to different types of ownership, as well as the laws and obligations of your preferred market.
Revise your offer and pricing
Being realistic with your expectations is the key ingredient to success. However, to develop such expectations, you need to be clear about what you offer and what your prices are.
For instance, if you noticed that some products are more popular while others bring you little or no profit, it is time you revise your offer. This could be excluding certain products from the offer, at least temporarily, so as not to waste resources on something that isn’t sold often.
Pricing can be a difficult topic to discuss and change but once in a while, it is good to check whether some tweaking is needed – this time you might decrease them but you will hopefully soon increase them again.
To know where you stand in this regard, you can take a look at your competitions’ offer or just check the feedback your customers have been leaving and you will surely find enough information to help you make the necessary changes.
Upgrade your record-keeping
Last but not least, you need to make sure your record-keeping is spotless and up to date. The only manner to improve your financial situation is to have a valid image of the financial situation. You can either do this yourself or hire a professional but your records will be your crucial tool in the decision-making process.
Some data that you would need to know include the profit you get from each product as well as which of the products is the most profitable one. Your cash flow shouldn’t be stretched thin and knowing the state of your finances at all times will help you decide on future tool acquisitions, investments, and changes to your offer.
Many factors make a business successful but a stable financial situation is one of the most direct indicators. Improving your financial performance could result in an expansion of your business operations which in return can lead to a higher income, making it a profitable venture.
Jacob Wilson is a business consultant, and an organizational psychologist, based in Brisbane. Passionate about marketing, social networks, and business in general. In his spare time, he writes a lot about new business strategies and digital marketing for Bizzmark blog.