When you are in the first few months of setting up or trading in your business it can be very tempting to spend money constantly – everything you see feels like a “must-have” for your business and its’ growth. There’s equipment to buy, time-saving ideas you “need”, new product ranges, extra services, perhaps you could do with extra furniture and fittings, the list is endless. And then as you trade, you realise that you hadn’t foreseen that you would need this or that at all, or perhaps thought you could get by a bit longer without buying. Maybe it just wasn’t in your budget as you had no idea you would need it, or the free/cheap initial buy, no longer makes the grade.
So, how do you work out what to spend your money on?
Having worked with lots of business owners, who are in the first few years of their business, I am often amazed at what they do and don’t spend their hard-earned cash on. Corners are cut on essentials, yet extravagant non-essential buys happen without a second thought. They make snap decisions without a thought to the benefits and costs that could occur at a later date but penny-pinch on things that would make their lives easier/produce results quicker/give a good ROI (return on investment) or could encourage client increased expenditure.
Why are you buying?
If you are thinking of spending out on something you think your customers would like or need, maybe equipment for a new service, a complete new product range, new retail stock, new furniture/fittings, etc, then the first thing I would recommend you do, is research. This takes on more than one form. Of course, you will be checking the pricing and benefits against comparable items (I hope, that everyone does this!) but have you researched whether there is an actual demand for this spend?
· Have you asked your client/customer base?
· Were your questions specific enough?
· Did you ask a large enough audience?
· Did you run the research long enough?
· What are the benefits to the business?
· How much will it bring in vs the cost?
· And importantly, when will the investment show a return?
· Are you 100% sure this isn’t just a “vanity” buy – ie you just “want it” and you haven’t checked whether there is at least, a reasonable demand for it?
If you would like to know more about how I can help you move your business forward more quickly and painlessly, contact me to book your free 30 minute “Business Review” and let’s work out a plan to improve your business.