What Is Your New Year Profit Strategy?
I was catching up with a small business owner friend recently over coffee and although the talk began about kids, family, and neighborhood, inevitably the conversation turned to business. It began with, “So how are you drumming up business these days?”
She has a nice sized practice catering to a high-end clientele, carries a strong balance sheet and runs the company with a few employees. She is really savvy and has created a strong foundation in her business that affords a comfortable lifestyle.
Her plan is to maintain a healthy company and to grow steadily. However, she is haunted by the thought that she might be missing the next big business idea that will grow the bottom line and release her from the day-to-day operational involvement. How seriously should I pursue Pinterest or Instagram? The act of being so hands on in her company does not allow the time to focus on company strategy and vision to grow to the next level.
While engrossed in the daily management of tasks do you take time out to take a higher view of your company? Is it a risky time to explore new avenues of growth or continue to do the fundamentals really well? It is never sound business advice to grow business at the expense of profits and there is no substitute for doing the basics well. So, where do you draw the line?
It would make sense to have the following essentials in place before stepping out into unknown territory:
Sales – develop and expand the funnel
Expenses – keep finding ways to decrease
Cash Flow – reserve a minimum of six months liquidity (up to one year if business is seasonal)
Customers – provide excellent service and maintain regular contact – don’t let them forget you!
Inventory – maintain tight turnover
Budget Plan – review diligently and on a regular basis – know your costs of doing business
Marketing – improve your reach in the marketplace
Tracking – know what went right, wrong, and develop a system to chart progress and changes
Small business owners that wish to maintain healthy companies do all of the above to guard the bottom line and manage profits. Improving the results of each further solidifies your foothold and serves as a platform to branch out confidently into expansion.
Do you agree?
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