Whether you’ve recently launched a startup or have had to adapt as a result of COVID-19, keeping a tight grip on your finances is vital. This is called being an efficient entrepreneur. The economy has taken a major hit, and it will impact your sales for some time to come. Reduced overheads are the only way to successfully counteract this problem, and you must learn to target wasted funds ASAP.
You probably feel that your business already operates in a cost-efficient manner. But it’s almost certain that you are guilty of wasting money in at least some areas. Check out the most common sources below, and you should see improvements in no time that help you become the efficient entrepreneur you need to be.
Staffing
Employees are the lifeblood of any business operation. However, staffing budgets will also signal the biggest ongoing expense that you face. With this in mind, allowing yourself to squeeze every last drop out of the recruitment process is vital. First and foremost, you must remember that staff members are only human. As such, finding the right people is as vital as finding the right talent. Personality is key.
Furthermore, you may want to pay extra attention to modern staffing methods. The gig economy enables you to find freelancers, contractors, and remote workers. Each of these ideas can be used to supplement your main on-site team. Similarly, some tasks can be outsourced to external companies to reduce staffing costs. It also removes the pressure to use larger buildings and more equipment.
If a new approach to staffing can generate a 10% saving and boost productivity by 10% in the process, its impact will be huge. Not least in regards to financial efficiency across the firm.
Team Management
Productive recruitment drives and staffing models build a solid foundation. However, a positive financial outcome can only be achieved by ongoing staff management. Time is money, which is why to be an efficient entrepreneur you must take the necessary steps to avoid wasted minutes throughout the day. First and foremost, you should consider cutting team meetings in half. Employees will cumulatively claw back several hours.
Besides, modern tech like team messaging Apps and project management tools will provide far greater clarity. When internal communications are at peak performance, productivity will soar. This will consequently boost the finances too. Provide staff training and encourage autonomy to let your teamwork with confidence. It is another step that will translate to financial rewards for the company.
On a side note, a team that manages itself without constant management frees up more time for bosses. As such, you’ll have a better chance to focus your energies on actually steering the company to success.
Bad Debt
Times are tough, and you will naturally be eager to take all necessary steps to generate more sales. However, you must not overlook the fact that a sale is futile if the customer doesn’t pay up. Whether it’s B2B or B2C, bad debt and unpaid purchases will severely harm the company. Delays will disrupt your cash flow while any payments that are subsequently written off will blow a hold in your profits.
So, while opening up the door to repayment plans or subscription services will allow you to win more clients, the efficient entrepreneur must take care. As a precaution, running credit checks on customers looking to use this service should identify people with a poor track record. Meanwhile, using an effective and professional invoice template will stop a lot of users from trying their luck. As well as B2B clients that forgot.
Given the challenges currently facing your company, it’s vital that all sales actually benefit the business. By ruling out bad debt, your hopes of staying on track are greatly increased.
Energy Consumption
As a business owner, it’s very easy to fall into a trap of taking the first deal available on key company purchases. In reality, the contrasts in pricing between different suppliers are probably far greater than you imagine. First and foremost, switching energy suppliers could cut your ongoing expenses by thousands of dollars each year. Insurances, web hosting, and a range of other items can follow suit.
In addition to choosing the right energy supplier, you may want to consider the way in which energy is used. Eco-friendly upgrades ranging from LED lights to efficient appliances can work wonders. Adding solar electricity and improved insulation are key additions too. Habitual changes, such as turning off appliances or using the right settings will lower the carbon footprint too.
Losing unneeded travel in favor of video conferencing can transform the approach to business forever. Crucially, it’s a move that will aid the brand image in the process.
Automation
Technology has evolved at a rapid rate, and it can unlock a brighter future for your business in many ways. Automated tech is perhaps the best solution for the sake of cost-efficiency. It aids accuracy and productivity. In many cases, it’ll also remove the need for human interactions. For example, a chatbot on your website allows clients to gain the info they need without contacting you.
Automation doesn’t only aid everything from customer care to productivity. Modern tech can additionally incorporate analytics. In turn, it’s possible to predict client behaviors, leading to smarter decisions. So, you can cut out processes or products that aren’t delivering results in favor of the concepts that do. In turn, your entire venture becomes streamlined and geared towards efficiency.
If nothing else, automation will allow you to upscale at the right times through data-driven decisions. The sooner you implement modern tech, the sooner you can see the rewards.
Social Marketing
Marketing is one of the most significant features of any business model. Successful ad campaigns will bring more leads to your door. But the best campaigns do it in a cost-effective manner. After all, there’s little point in gaining $1m of sales if you spend $1.5m on the marketing strategy. Online advertising has become the most cost-effective option, not least due to analytical tools. Still, there is a better way.
Influencer marketing capitalizes on the power of recommendation. And the fact that customers are more likely to listen to what others tell them. Therefore, paying social media influencers to promote the brand and its products is ideal. The key is to find big names that share a similar audience to the key demographic you’re trying to reach. A big response from a targeted market will deliver stunning results.
Well-known faces aren’t the only solution, though. Affiliate marketing schemes and referral campaigns are ideal. Best of all, commission-based deals ensure that you’ll only make payouts after gaining sales.
Product Management
An unsold item is the biggest waste of all. Not only have you invested time in manufacturing and marketing, but it is also taking up space. If you have been left with large volumes of unsold stock, the best option is to sell quickly at a discounted rate. It will claw back some cash flow and free up space. You could also use the promotion to build interest in the brand and get people talking.
Crucially, you should analyze what sells well and keep those items stocked. At the same time, clients can give you valuable insight to direct your decisions. This can occur courtesy of surveys, focus groups, and a range of other market research tools. When your product management is right, it will significantly reduce the amount of wasted time, resources, and money. This is great news for the brand.
It will take a conscious effort to adopt a winning mindset. Once you do, however, it soon becomes second nature. Moreover, you’ll be able to complete future business decisions with confidence.
Safety & Security
Protecting your business has never felt more important. Frankly, it’s hard enough to keep your finances in good order without the fear of threats linked to safety and security. All buildings, databases, and people should be protected with the right facilities. CCTV, cybersecurity, and fire extinguishers are just three issues that should be considered. Risk assessments should be carried out in all places.
Keeping intruders and fraudsters at bay is vital, which is why employees should be taught about the latest scams. It should be noted, though, that internal threats are often the biggest danger. Non-disclosure agreement documents will prevent ex-employees from stealing leads or innovations. This is arguably the greatest form of protection that any business owner can implement during these times.
While prevention is always the best form of protection, insurance premiums and copyrights are crucial. If someone does attempt to harm the business in any way, you’ll be ready to respond in style.
Financial Organization
Finally, to truly be a efficient entrepreneur there is little point in trying to boost financial efficiency if you don’t monitor the situation. You cannot possibly reach your destination in style if you fail to plan the journey. Therefore, tracking all incomings and outgoings should be a priority during these testing times. Only then can you continue to make data-driven decisions based on relevant insights. Moreover, it will deliver peace of mind.
The process of staying on top of your finances shouldn’t frighten you. Accountants can be hired to ensure that you gain all entitlements, such as tax deductions. Meanwhile, the software can be downloaded to manage daily, weekly, and monthly matters. Collecting and collating data in the right way will give you the best chance of keeping all of the above factors moving in the right direction. Embrace it.
Great organizational skills are essential in all aspects of the business. To be an efficient entrepreneur, your company’s financial monitoring shouldn’t be any different. You’ve got this!
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