A rusty bucket leaks water. Is your business is leaking money? And like a rusty bucket, is it leaking in more than one place, so that no sooner than you’ve patched one leak, another springs up to take its place?
Every business is conscious of overhead costs (especially in the current climate). But at the same time, businesses should also beware of false economy. Spending in the wrong places and failing to spend in the right places can result in your business hemorrhaging money and creating cash flow complications.
Here, we’ll look at some of the ways in which your business could be losing money. Fortunately, with a little care, fixing bad habits and some judicious capital investments, you can plug up those leaks.
You’re Failing to Keep Track of Expenses
Spending and debt are part and parcel of doing business. But if there’s one thing that no business should be doing, it’s overspending on tax. But if you’re failing to keep track of all your business expenses, that’s exactly what you risk doing.
You can plug up this leak by using a bookkeeping service like PAS Consulting to manage your books and account for all expenses. And if they cater specifically to your industry, so much the better. They’ll know exactly what to look for.
You’re Chasing the Wrong Customers
We all know that acquiring new customers is essential in growing your business. But if you’re chasing new customers indiscriminately, you could be doing your business more harm than good by chasing the wrong customers. The kind who either aren’t going to buy from you, will only buy from you once, those who just want a freebie in the form of your lead magnet or those who are just looking for something to complain about. You need to due your homework when chasing prospects through your sales funnel and focus your efforts on those most likely to convert and most likely to stay. Which brings us to…
You’re Not Doing Enough to Boost Retention
Customer acquisition is certainly a priority. But don’t forget that it costs around 5 times more to acquire a new customer than it does to bring an existing customer back. Need to kill two birds with one stone? Try setting up an incentive/referral scheme, where existing customers get bonuses or discounts for referring their friends, family and colleagues to you.
You’re Trying to Keep Up with the Joneses
Investing in the right tools and tech can be a great way to get an edge over your competitors. But if you’re buying new tools just because your competitors are using them, you could be wasting your money on capital investments that are surplus to requirements.
You Don’t Have the Tools to Make Sense of Your Data
Finally, Big Data can yield useful insights for businesses. But it can also create big headaches and leave you with analysis paralysis. Which why you should invest in Business Intelligence software to make sense of all the data you’re collecting and yield actionable insights that can inform your strategy.
