The question is; why did you start a business? The obvious answer is to make money, more money and even more money. The reason capital is injected into a business is so that it can in turn generate income that will balance the invested capital and further generate profit for the business owner or investors.
Sadly, the notion that 90% of startups that raised capital from investors fail has affected the success rate of most startups. Most businesses now start out with not as much drive to push through the scary storms of startup and change the numbers in their favour.
The fact is, when a business is not making the desired money required to keep it running and to up the investment, the next thing we see is that the business packs up.
However, there is still a small matter of the 1 out of 10 startups that succeed. This means your small business can turn into a multi-billion-dollar investment. Below are smart ways to get you started on that.
1. Sell What Matters.
Frankly, the fact that you put down a mouth-watering profit in the business financial plan of your startup does not guarantee a realistic income for your business. The numbers are affected by what the consumers are looking for.
The challenge most startups have is that they project products and services that only have relevance in their locale. To worsen it, there is no guarantee that the number will shoot up as consumers’ buying preferences vary.
If your business will give you the kind of income that will not only sustain and grow the business, but also generate capital to birth other startups, then you must give the consumers what they want.
Beyond giving them what they want, you also need to give it to them in the way they want it.
Does it take all of that? Yes, it does. Business is about sales and that is made possible by consumers.
In March 2017, Abercombie & Fitch test ran a buying gateway for their brand on Instagram, according to a business news report. This in no small measure turned their fortunes around. They were giving consumers what they wanted.
2. Swim the Waters of Expansion.
I’ve said it before and it bears repeating. The reason you are in business is to make money, make more money and yet much more money. Your business can only be referred to as a money-generating machine if it is making more money.
Nothing helps your business make more money like expansion. A successfully executed expansion increases gross sales and net income.
Some folks will say that expansion will involve increase in capital investment and operating cost. And I’ll say, if that is what it takes, do it.
Angel investors usually outsource growing and expanding businesses to put their fortune into them.
If you are not expanding, you will get stuck. And when you max out, you most likely will shut down. So swim the waters of expansion; there is more money to be made.
3. Unload Your Business of Multiple Loans.
Startup is not easy, especially when it comes to financing and capital generation. Usually, most entrepreneurs end up taking loan facilities just to get their businesses off and running. Most of these loans take advantage of the desperation and time constraint and hit startups with high interest rates.
The rates are high for startups because most lending institutions put the risk factor into consideration. Small Business Chron says that an internet business startup will attract a higher interest rate than that of a conventional business venture.
Again, there is a benchmark on the amount of a loan startups can access. This in turn leads entrepreneurs into multiple debts, as they aspire to raise as much money as possible.
As the business grows, these high loan interest rates affect the net income. Therefore, there is need to unburden your business of multiple loans.
One very effective way of doing this is through debt consolidation. Knowing that your business has gained a financial ground, you can access a loan of lower rate in order to offset the high-interest ones you took during the initial launch phase. Apart from reducing the high interests of multiple loans, it’s easier to track repayment process when your debts are consolidated.
4. Spread Your Tentacles.
Okay, I have heard and read a few people say that diversification has become an obsolete and mundane advice to give to a business owner. However, the fact still remains that diversifying is as effective as it has always been. Your business should not be known for one product or service alone; it limits your business income.
Integral to Facebook’s advancements is the fact that it became known for other services other than just a social hangout platform for college kids. Facebook has brought the world together and has provision for any kind of service that users desire.
To raise your income, you must spread your tentacles and delve into other niches.
In Closing
With the high rate of startup failures, there seem to be some kind of cold fire creeping into already existing businesses. However, if you carefully follow these steps, your business will generate more income at an unbelievable rate.
