Tradies spend a lot of time getting work done on various projects for clients with the goal of business growth and profitability. Business growth and profitability are closely related, on the one hand, growth requires a tradie to be in control or have oversight of the various business functions and profitability on the other hand, is as a result of sound financial management principles.
It is a plan to:
1. Control your finances
2. Enable you to make confident financial decisions and meet your objectives
3. Ensure you have enough money for your future projects
Whether you’re just starting up, or have an established business, it is easy to fall into the trap of having to do and control everything yourself. Being the ‘jack of all trades’ limits your time and ability to make quality management decisions. Having your business accounting software online will enable your business to transform, grow and to compete with giants in your sector.
Looking over your cash flow, you’ll notice one expense popping up over and over again, and it’s a big number. Without it your business can’t grow and you can’t get a break! Whether you pay wages weekly, fortnightly or monthly, if you are not truly aware of where these dollars are going, it can hit your back pocket hard.
What’s that saying; you need to spend money to make money? Even with a low cash flow this still rings true; just be sure you are spending money in the right places. When times are tough and sales are down, don’t stop spending on marketing; in fact, spend more and spend less on other things.
However, sometimes the best option is to spend your time rather than cash. Either way, your marketing strategy should be the most productive and sales focused it can be, generating quality leads to close more sales (thus improving cash flow).
Here are some tips to squeeze the most out of your marketing budget:
1. Know your target customers and direct your marketing to being where they are. Don’t waste time or money on marketing for the sake of marketing. If the people who are most likely to buy from or hire you won’t see it, don’t bother.
2. Social media, blogs, forums, etc. These are creative ways to market your business when cash flow is tight- the main investment here will be your time. Connect and converse with other businesses and individuals in related industries on social media, comment on blog posts and give expert advice on forums. Each interaction will give you the opportunity to direct potential buyers to your social media page or website. Be sure to refer to tip #1 for each platform.
3. Utilise your current database via email marketing. Using software such as Mail Chimp allows you to track each open, email interaction and unsubscribe to ensure you are on the right track. Email marketing is a great way to keep current and former customers engaged with your product or service and redirect them back to your website; just make sure you have something of value to say each time you are in contact. This type of direct marketing ensures your voice is being heard by the right people and you will only pay for what you use.
4. Network. This is not about getting your business card in circulation at networking events; it’s about creating mutually beneficial relationships with key people who work in the same or similar industry. So, do your research- who, if you associated with regularly, would have a significant impact on your business? Call them up and introduce yourself. A 1 on 1 meeting over coffee with the right person sounds a lot more productive than attending a “can I flog you my product?" networking meeting, right?
5. Don’t stop marketing when times are good. If you have the attitude “I have enough work right now so I can save my marketing dollars” you are simply setting yourself up for another slump down the track. If you are not constantly and consistently promoting your business regardless of your financial situation, then your business cannot grow. Wouldn’t it be easier to have a continual stream of quality leads coming in rather than having to work twice as hard to find customers when times are tough?
Finally and most importantly, keep data on the source of business/sales. Ask your new customers “how did you hear about us?” and keep records of their answers. Each campaign (that’s each email, each social media platform, each networking source) should have a corresponding marketing strategy that outlines what you intend to achieve with your efforts, how much you have spent and what were the outcomes. This will assist you in achieving tip #1.
Cloud Accounting or online accounting has garnered a significant stake in today’s globalised market. It is very similar to your old accounting software, however your information is no longer stored on your personal computer, instead all data is securely stored and processed on offsite servers known as “the cloud”, enabling you access from any device as long as you are connected to the internet.
How can a business making plenty of sales possibly go bust, you may wonder? The answer is cash. Your cash can be in a surprising number of places other than where it belongs - in your account.
Managing your cash flow is more than simply looking at what goes in and out of your accounts and paying your bills on time. Here, we suggest how to prioritise your cash flow to make the most of what is available to you while moving your business forward.