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How to grow a small business without funding your expansion through debt

grow a small business

 

If you’re a SMB or start-up owner, you’ll be very familiar with the problem of how to grow a small business. You don’t have time to focus on growth because you’re too busy serving customers, but if you don’t serve your customers – you won’t have the money to grow your business. It’s a catch 22 situation so what’s the answer? Here’s a few ideas…

Put your prices up

Yes, that sounds odd but if you have plenty of clients coming to your “door” and simply don’t have time to serve them all, it’s time to put your prices up. Even if you don’t have customers clambering through your (virtual) shop windows to buy your products or services – a price rise is more than likely, something you could still put in place. It’s the paranoia of small business… not having the infrastructure and marketing clout behind them to compete with bigger businesses, that makes them want to charge less but the reality is – your products and services are just as valuable as those offered by bigger business and you should charge appropriately. Still not sure? Do some market research. Phone up your competitors and get some quotes and you’ll see more often than not, that your prices are well below market rates.

Bring your costs down

Sounds obvious, but it’s not just about getting the best price for raw materials to make your products. Think about electricity, heating, water, business rates and rent. Do you really need a large, posh office in a top postcode if you don’t typically entertain clients at your premises? Are you heating rooms in your building unnecessarily or leaving the heating on overnight when you’re not even there? What about your energy suppliers… are you sure you’re getting the best deal? How about subscriptions to software that you have taken out? Do you still use that software? Is it value for money and is there another platform that can do it better? A great way to bring your costs down is to go through the monthly business bank statement and question every item on the list. Ask yourself; Why is it on there? Does it need to be? Does it add value to the business? Can it be done better or cheaper elsewhere? Once you reduce your costs, you’ll have more money in the bank to consider bringing someone else on board and begin to expand.

Make better use of your time

Have you ever attended a meeting and come away thinking “well that was a waste of my time”? Me too. In fact, if you analyse that enormously hectic weekly schedule you set yourself – you’ll probably find there’s quite a few activities in there that are not adding any value to your business. When it comes to client meetings, don’t agree to meet just because someone asks to do so. Qualify your meetings first. Ask (i) Is there a genuine need for my product or services (ii) are there timescales in place for that need to be fulfilled – is there a project or a deadline for the need? (iii) Is the person that’s asking for the meeting the right person to be having the meeting with or do I need to suggest other people attend as well (iv) what do they want to get out of the meeting? Set an agenda and set objectives so you know that if you do attend the meeting, your time will be well spent. Don’t be afraid to say no to a meeting if you don’t think it serves a purpose. I’ve probably turned down around twenty meetings this year because I could not clarify the purpose and the value of them. Time is THE most valuable commodity in a small business. If you can free up time to work on your business, then you can figure out the best way to help it grow.

Partner Up

If customers who use your product or service, typically use another non-competing service as well, it makes sense to partner up and refer customers to each other. As a marketing agency for example, we partner with a web development company. We’ve also partnered with small business hubs and shared office spaces in the past. If you’re able to provide each other with a unique offer to pass on to each other’s client base, that partnership can be a strong differentiator for customers when making their buying decision and that means you need to spend less time on business development /sales activities to hit the same kind  of numbers that you’re already doing.

Use outsourced service providers for a fraction of the cost

Of course we have to say this because we’re one of them but if you don’t have enough cash to employ someone on a full time basis, or you don’t have the cash to be able to employ someone with the right level of skills that you need – outsourcing is the way to go. It’s inexpensive, you typically get a higher skill level and there’s zero risk to your business. If you have a bad month, just give notice on your outsourcing contract or reduce it down to a more affordable level until you can afford to pick it up again. Of course, with sales and marketing, the contrary applies. When clients are thin on the ground, you should be spending more to get clients through the door – but don’t do it blindly. Always hold your outsourced sales or marketing team to account.

In this article, we’ve covered just 5 ways to help you grow a small business without taking on debt. Of course there are hundreds more so why not share your ideas and help other small businesses grow.

Thanks for reading,

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PPS – Find out more about our outsource marketing department services here

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