Gary King, managing director of Tendo and regional head of the Association of Business Mentors provides 5 top tips on how you could generate an extra £5K in your business each month.
Stats show that 1 in 5 business owners miss payday to survive and 70% rely on their personal savings to fund their business. I know, I made these mistakes too in the early days - it’s actually widely considered to be part of building a business, but how ridiculous is that?”
I spent the first few years building the wrong business, filing expenses at 1 am and missing my son’s football matches to try to keep on top of work. If I’d have had more cash in the business I could have employed others to help and given myself the lifestyle I actually wanted.
I had my epiphany around 2.5 years ago after working with a business mentor myself, and I now run Tendo, alongside being a director of two other businesses, all while working a four-day week. This is because I’ve enabled myself to have the freedom to choose how and when I work.
I’ve supported hundreds of other business owners who have been through the same pain, so here are my top tips on how you can enable more cash into the business, to then provide you with more freedom to choose.
1. Building the right business
Take time to consider: is this business really a business or is it a job you’ve given to yourself? To be able to generate more cash from your business you need more than just you and your time as the billable assets. A business that simply ties you down is not a business worth having.
Consider how you can evolve your business and develop the right model to make it earn more in a way that is not dependent on you doing all the work and document this. Business planning is key to reaching your goals and central to earning more money in your business is understanding where that extra cash is going to be coming from.
2. Make existing clients worth more
In every instance of my small business mentoring, we have always found a way to get more money out of existing clients. This is the low hanging fruit and requires the least effort. So often clients are not aware of your wider services, would be happy to be upsold to if they knew how else you could help them, and might even be prepared to pay a bit more for your services, if you can justify a price increase.
Make sure you invest in your current clients, maximising and documenting their results and helping them identify how you have cured a pain point for them - listen to their next pain point, then offer a follow up service. This works really well for people who don’t like ‘selling’ - as you are not selling as such, you are finding solutions for them, and that’s something you can get passionate about.
Become a part of their team so you are invaluable to them and their growth and are seen as a contributing factor to their success and I guarantee they’ll be worth more to you each month.
3. Get others to do your sales for you
Take those happy customers and get them to generate business for you. Incentive schemes can work here but, more often than not, happy customers will become your ambassadors without the need for reward - and they often know others with similar pain points. But, be proactive and ask who else they know in business who could use your help.
Also call upon your business network to help spread the word -make sure you educate them on your services and successes (use social media as well as regular in person catch ups). Consider if you can generate a ‘mini team’ of complementary businesses targeting the same audience and create a plan for cross referring work. With a bit of effort referrals could be one of the most efficient lead generators for small businesses but only if you have a strategy and take control of enabling them.
4. Generating Revenue from others
It is important to understand the different types of business model available to you, where and why you use them to support your growth. Licensing and franchising are powerful ways that you can make money to complement your income but some of these do take initial up front investment.
If you’re looking for quick wins explore creating alliances and combining services - maybe a joint workshop or programme you create, a special offer to their client base - that kind of thing - something where you are paid for your time but the clients are brought to you via someone else’s network.
Licensing and franchising do hold legal costs but as part of a long term plan are fantastic routes to growing a business without physically rolling out more offices, and offer income not reliant on you.
5. Growing the right team
You will never be able to generate more money if you do everything yourself. Consider what tasks you can hand over to a trusted team, creating time and head space for you to grow your business. These don’t have to be full time, or even permanent members of staff.
If you are something of a ‘control freak’ as I was, investing in a mentor could be the 3rd party view you’d really benefit from, to then see what areas of focus will really pay off for you. Using experts where they can add value is key to growth, and you need to be able to invest in this for the business to run smoothly without you.
Whether it’s to pay yourself more, to invest back in R&D, or to employ someone, I haven’t met a small business owner yet who couldn’t do with a few grand extra in the bank each month. The great news is that it’s most definitely possible, through making a few small changes in how you run your business.
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