We often see how business startups, as well as established businesses, get into bankruptcy. This happens mainly due to poor marketing methodologies. Here are some useful tips shared by Shaan Parvaga to help you and your business stay away from bankruptcy.
- Outsource and reduce operating costs
Today most of the work which was otherwise done in one office has been spread out across the world. Outsourcing has been a very successful endeavour with people working for large offices in the United States from one bedroom apartments in Sri Lanka. Globalization has made this possible hence make use of it and get specific work done elsewhere at a fraction of the cost. You would save on space, manpower and many more.
- Make frugality an important trait
“A penny saved is a penny earned” keeping this in mind saving wherever possible is the best strategy to save money for other things that your small business could use. Being frugal with your expenses would ensure you have ample money in the kitty when the going gets tough.
- Profit is more important than growth
Profit is better than growth and it is when you are profitable as a small business, could you afford to grow. So ensure that you don’t count the chickens before the eggs are hatched. Make your ends meet and ensure you have enough for a rainy day before you would contemplate on growth. Growth would eventually come but do not rush it till you are ready.
- Tax breaks and incentives need to be taken advantage of
There are tax breaks and other administrative incentives announced by the State and Federal governments from time to time, take advantage of them as you would be in line to save a few dollars. These come with deadlines and if you are up to date in your tax and other payments you could cash in handsomely on such one-off chances. The idea is to always look for possible avenues to save a few dollars wherever possible.
- Always hire the best
Top performing employees would perform the task of maybe 1.5 or 2.0 employees hence it would be prudent to always hire the best. Though you may pay them more they would perform better and take on additional responsibilities. It is often said that “if you throw peanuts you will get only monkeys”. Top talent would also be qualified better to handle the tasks at hand hence it would be a better choice especially for a small business.
- Hire contractors instead of permanent employees
It is more prudent to hire contractors than having permanent employees on the roll to perform similar tasks. As said above it would be easy to manage, as there would not be a human resource issue as the contractor would be responsible for a specific task which he would complete and leave. The hassle of managing and ensuring everything is well at the end would be the only interaction you would need.
- Formulate a good training program
Once you have the best training program attracting newly passed out graduates as interns would not be a major problem as they too would look forward to a thorough training to further their careers. You could hire them for much lesser than what you would pay other experienced candidates. Interns would like on the job training and will go out of their way to complete tasks and achieve set objectives.
- Word of Mouth (WoM) is an important advertising tool
Word of Mouth (WoM) is a much sought after strategy among professional marketers in the United States because it is known that more than 90% of retail sales in this country is finalized through Word of Mouth marketing strategies. Using this very effective tool strategically would ensure you get a wider audience for your product or service. There has been a strong push, especially with Social Media also becoming popular among consumers who interact more closely.
- Strategize marketing
Plan out your marketing strategies to be cost-effective and if during monitoring you find that an initiative is not bringing the Return on Investment expected, pull it out and replace it or modify it. Your marketing strategies are the backbone of your company and they should bring the desired results for the money you would have spent. If they fail to deliver then you are incurring a wasteful cost which should not happen.
- Cut costs wherever possible
There are many areas where cost could be curtailed or even cut, which needs to be gone over with a toothcomb to find them. It would surprise you the wasteful expenditure that would be occurring in every department and every section. If you could identify them ensure you reduce wherever possible and you would find that it is a very substantial amount which would be an earning at the end of the day. Every dollar is important if you are going to ensure you pull your business around.
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