Irrespective of business size and type, finance is the heart of every business. Without adequate cash flow and budget, you cannot imagine yourself in the business world. But it is not easy to maintain financial stability all the time; you have to deal with many unseen situations. Take an example of the pandemic, have we ever thought that the small virus will ruin the world and compelled business owners to shut their doors forever? No right?
Running a small business can be cumbersome, especially when you lack adequate finance. Today, technological innovation and customer preferences keep evolving, and to keep pace with changing business requirements, along with a business plan, you also need strong finance to stay ahead in the competition.
Lack of finance or budget scarcity can make or break a small business. A recent study has shown that over 80% of small businesses fail to survive for more than three years in the market due to poor cash flow. So, what to do to make your business recession-proof and overcome budget hurdles? Keep on reading this blog; you will learn how to increase the chances of business success amid this highly volatile market.
Five Ways for Your Small Business to Resolve Budget Problems
From 2009–2016, there were more than 400,000 small businesses started across the USA; among them, 80% of businesses go through the first year, then this percentage falls down and reaches 70%. And after five years of establishment, more than 50% of small businesses get closed, and the foremost reason is lack of adequate finance — statistics and data revealed by the US Chamber of Commerce.
In short, budget hurdles and financial issues are the major reasons behind the business’s failure. Poor money planning, natural calamities such as floods or pandemic, other unseen expenses, market fluctuations, etc., are some major issues entrepreneurs face while running a business. And these all situations really affect business growth.
This post will look at the five best ways to help small businesses overcome budget or finance issues and keep their company productive, profitable, and afloat.
Opt For Multiple Revenue Streams
Uplifting sales and revenue are the ultimate aims of any entrepreneur. As said earlier, to fulfill modern customer’s needs, you should have enough budget, and building multiple revenue streams help you cope with expenses. You can’t rely on a single revenue source as today you have a plethora of ways to generate a decent profit.
You know how the on-demand economy market is flourishing globally, and the main reason behind this is that it offers multiple revenue streams. Whether you talk about the online taxi business, or online food and grocery ordering, it adds value to existing business and enables entrepreneurs to generate revenue from different sources.
Earlier, transportation business owners had limited sources of income, but now digitization has opened the doors and encouraged them to make an uber clone app as it can boost the bottom line and keep business propel no matter what condition you face in the future. In the same way, you know very well how restaurant owners pivot their business to online ordering to boost profitability.
You can’t solely depend on a single revenue source, so don’t put all your eggs in one basket; instead, opt for multiple revenue streams and experience how flexibly you can run a business.
Focus on Automation
Modern tech solutions have made it possible; small businesses can automate certain repetitive tasks and save huge money spent on them. Later, this budget can be used on core business objectives.
Take an example of chatbots; how do AI-enabled chatbots automate customer care service and accelerate business growth. Companies no longer need to appoint customer care executives, this saved budget they can use on something productive. Business automation is necessary these days, and thanks to cutting-edge tech solutions that are smartly carried out tasks exactly when needed.
In short, the business automation can do more for less time and offers some advantages such as
- Reduce errors
- Saves cost and time
- Improves operational efficiency
- Gives data-driven insights
- Reduce employee workload
Time is money, and automation saves huge time invested in repetitive tasks. Make sure your small business has opted for automation that delivers a positive impact on your small business and overcomes budget issues.
Keep Your Existing Customers Happy
A strong customer base is the backbone of any successful business. Like budget issues, customer retention is also a major concern for many small business owners. No returning customer means your business faces a downturn in sales, and it has a direct relationship with profitability and budget.
Keeping people engaged with your business is crucial these days as it is the key to build a strong, healthy business. A report from Harvard Business School revealed that a minor increase in customer retention results in a 50% increase in profits. Let’s carry forward the above example, if you are engaged with an online delivery business, offering your customers attractive deals and discounts gives them a reason to stick to your services.
Moreover, over 82% of brands have realized that keeping current customers happy is quite cost-effective than acquiring new ones. You can refer to customer retention strategies that keep your customer base strong and help you build a strong relationship with them. This eventually overcomes budget issues while spending less.
Consider Social Media
Social media platforms do not need an introduction nowadays, from posting content to communicate with customers to promote products and services, social media is the most cost-effective way to advertise your small business. If you opt for other marketing techniques, you have to spend huge bucks, but social media is free unless you choose paid advertising options.
If you are a retailer and launched a grocery delivery business, you can create a business profile on Facebook and Instagram, it will not only boost sales but increase your brand value, reach a wider audience, and ultimately boost sales that reserve your funds and cope with budget issues.
Embrace Business Agility
We all are aware of the popular proverb, called “change is the constant”. Well, the same proverb applies to the business world also. Business agility means making a fast decision to capture opportunities when the time comes. It also makes the business expanding process easier; As said earlier, we know how amid the pandemic, businesses across the globe going digital, will not only solve your budget issues but also makes your business powerful to mitigate risks.
Business agility is so important as it will help businesses thrive. And embracing business agility means adopting emerging whims of the market, customers, and business world.
Don’t panic, budget hurdles and financial turbulence is something that many small businesses experience. Get started with the above tips, if you plan and execute well, you can make your small business financially strong and solve any problems before they escalate.
Deep is a serial entrepreneur and blogger who wishes to support the ground transportation industries with his writings. He covers up all the known and unknown facts around the industry and puts them together to create trending articles across different websites. He also includes details on the latest trends, fun facts, business expectations, strategies, and models to follow to achieve success in the transportation sector.