Are you a new business owner and facing big decisions on a daily basis? Like… Who to hire? How to incorporate your brand? And most importantly: How to manage your startup money? Another crucial challenge is your information sources. Published information can offer valuable insights into market conditions and trends.
This article will outline two particular risks and mistakes that affect expanding businesses and what to do about them.
To read additional risks and mistakes with solutions to them, you might like: Skills and Attitudes: Why are They a Common Challenge in a Growing Business.
Financial Management and Money Flow
A good money flow control is vital for any business. For an expanding company, it is crucial – cash restrictions may be the most critical factor limiting expansion, and too much trading can be deadly.
Creating the best usage of your finances should be an essential element in business preparation and in the evaluation of new opportunities. With limited resources, you may have to miss promising opportunities if following them would mean depriving your core business of necessary funding.
Every aspect of working capital must be cautiously controlled to augment your free money flow. Efficient credit management and strict control of outstanding debts are fundamental. You can also contemplate increasing funding against financial liabilities.
Good stock control and efficient supplier management are likely to be progressively important as companies grow. Obsolete stock holdings can become an issue that needs periodic clarification. You may want to work with suppliers to decrease delivery cycles or change to vendors and systems that can handle delivery on time.
Planning helps you forestall your financial needs and organize adequate funding. For many developing companies, a key decision is whether to bring in external investors to offer the capital needed to support the expansion.
As mentioned above, published information can deliver useful information on market conditions and trends. As an expanding business, your own experience may be even more valued.
You should be able to build an in-depth picture of what clients want, how they act and which one of your current advertising methods is working best.
Taking a proper time to exchange with main clients is worth it. Additional significant sources of market information are your suppliers and other business associates. You should invite your employees to share what they know about clients and the market. Efficient computer systems also help to distribute and analyze vital information such as customer buying behavior and their preferences.
You may want to conduct additional research as well. For example, you can test the customer’s reaction to a new product or service. You can actualize this yourself, or use an independent researcher or market research agency.