The world of business can be brutal. This is a fact as old as time, yet it has never been more true than in the last decade. The economic crash saw industries crumble around the ears of their most successful players, and only the most cutthroat, innovative, and business-minded survived.
This has created a hard landscape for fledgling businesses to be born into. It’s tricky to turn a profit, and harder yet to secure funding if you should find yourself in a spot of bother. The best way to remain afloat is to stay in the black at all times. To help you do that, here are three top tips to live by.
Tip One: Budget
As is the case with domestic life, budgeting is one of the greatest tools at your disposal. There are lots of savings to be made, if only you’ll sit down and take the time to work them out. The best way to do this is simply to make a list of all of your monthly outgoings. There are some areas that you won’t be able to compromise on – such as employee wages – but there are also some that you will. Can you cut your electricity bills by looking for a new provider, for example? Can you extend your current equipment’s shelf life by maintaining it rather than replacing it? There are lots of little ways to cut costs – make sure that you take the time to find them.
Tip Two: Think Ahead
Yes, you have to speculate to accumulate, but you don’t have to risk everything on every deal. Before you pledge any money towards anything, think long and hard about how likely it really is to turn a profit. Even if you have absolute faith in a new undertaking, never spend more than 25 per cent of your current funds on any one venture. This way, you know that even if everything goes to pot, there will still be money in the bank to set things to rights.
Tip Three: Use Invoice Financing as a Borrowing Option
Our final top tip is this: if you really have to borrow money, consider invoice financing before any other borrowing options. Providers can be found through a company like Touch Financial. This method allows businesses to borrow money against existing invoices, rather than going out on a limb and relying on potential profits in the future. Low risk, flexible, and ideal for stimulating your company cash flow, it’s a great way to line your pockets without risking your enterprise in the process.
How will you keep your business in the black?