Are you struggling to boost revenue? These four growth hacks can help you take your business to the next level.
In our ultra-competitive global marketplace, you’re given only so many opportunities to take chances before you’ve got to prove your business chops to investors and stakeholders.
And at this point in the small- to medium-sized business (SMB) game, you’ve taken those chances and then some… The good news is that they’ve paid off! So much so that you’re now responsible for taking your business to the next level. It’s time to show the world what you can do with the lean and mean company you’ve developed.
And that’s when it hits you: You have no new growth hacks left in your toolkit. You’ve already tackled those little things that tend to thwart SMB growth. You’ve built a high-performing team and meticulously tracked tax deductions. But now what?
If this sounds anything like you, have no fear! We’re sharing four smart steps that can help boost your business growth over the long haul.
Step 1: Upgrade Your Accounting Systems for Growth-Driven Insights
Back when you first started your business, you were probably content with an accounting software that allowed you to just be able to send invoices to clients, track your expenses and get paid online. But today, you are likely looking for more sophisticated features to grow with your successful SMB.
Not sure what to consider? Here’s a quick checklist of the top three features you should look for when upgrading your accounting system:
- Cloud-based software: Whatever software you choose, important financial data should be easily shared across accounts, devices and integrated tools. After all, you and your team are relying on accurate measures of your SMB to plan for the future. By having this data easily available, you will be able to make better financial decisions.
- Robust reporting functionality: On top of having access to financial data, you want to make sure you also have access to the right financial reports. Make sure your preferred solution has double-entry reports available, such as Trial-Balance, General Ledger and Chart of Accounts. With data from the right reports, you can be confident about planning for long-term growth and success.
- Easy “set-and-forget” automation: Want to fast-track the collections process and spend less time on administrative work? Then consider a solution that automates invoicing, notifications and payment reminders. Also make sure the solution includes flexible payment options, including credit cards and direct deposit.
Step 2: Boost Your Working Capital
Think of working capital as the lifeblood of lean and mean SMBs. In its simplest form, working capital is the amount of assets you hold minus the amount of your liabilities. Assets could be cash and/or items you can convert into cash, such as funds from accounts receivable, inventory, equipment and short-term investments. Effectively, it’s the money used to fund day-to-day operations, support running costs and also, pay short-term debts and cover other expenses.
Ideally, success over the long term requires “positive working capital,” where current assets outweigh liabilities and you have enough funds to cover short-term debt. Working capital is especially important when a company’s about to take a big step. For example, this could include launching a mission-critical campaign or taking on a new partnership that has the potential to open up new avenues of success for your growing business.
If you’re ready to take your business to the next level but need to balance your organization’s financial health, you’ve got plenty of options available to you. Check out these three different ways to boost your working capital:
- Adjust payment terms on your invoices to include a signing deposit that minimizes the chance of late or non-payment.
- Enlist Small Business Administration (SBA) or short-term online loans, which are better for longer-term projects. They typically feature interest rates of 6–8%. In contrast, while short-term online loans are ideal for covering stopgap needs such as buying inventory or supplies, they come with higher interest rates of 20-80%.
- Seek out invoice financing, which lets you sell unpaid invoices to a third-party in exchange for immediate cash fluidity.
Step 3: When in Doubt, Outsource
It might seem counterintuitive since it costs money to hire outside help, but agile SMBs often have to look outside their organizations for smart solutions to help them grow. And these days, more than 90% of companies consider outsourcing as an important part of their growth strategy.
Why? The fact is: Outsourcing to independent contractors or third-party subject matter experts (SMEs) can save you money on both overhead and capital costs—to the tune of 60% by some accounts.
If you’re still skeptical, here’s another way to look at it: Yes, your business is growing quickly, but you need to keep maximizing your earnings to continue to grow your business at the current rate (or even faster!). And outsourcing can help with this because it allows SMBs like yours to:
- Focus your time and expertise: Apply your energy to your big-picture KPIs and leave the hands-on work to the experts.
- Step up productivity: Reduce distractions and allow in-house staff to focus on their core responsibilities. Delegate focused work to independent contractors who can do the task quickly, efficiently and with the clarity of being an expert at the task at hand.
- Make your firm more attractive to investors: Pump more capital into revenue-producing activities and less into capital-intensive baseline work.
The first function that many SMBs outsource is accounting and bookkeeping. Keeping track of your small business finances is crucial, but time-consuming. Not to mention that many SMB owners start their company as a passion project, so their skills don’t necessarily involve reconciling bank accounts and preparing tax returns. Often, you can outsource these functions to a virtual bookkeeper or accountant, at a fraction of the cost of hiring an employee.
Unsure about how to find qualified and high-performing independent contractors? Start with your own personal and professional connections; LinkedIn recommendations can help you identify the best of the best of SMEs. Other sources include local SMB accelerators and incubators, as well as small business networks, consultancies and other like-minded industry groups.
Step 4: Understand Your Customers Better AND Your Competition Better
Today’s empowered consumers don’t just want more relevant and personalized products and services; they demand it. And so, if your growth strategy has anything to do with driving more consumer dollars into your accounts, you’d best get up close and personal with your customer base and their wants and needs.
Here are three ways to get to know your customers better:
- Enlist a cloud-based customer relationship management (CRM) platform that tracks basic demographic information and captures in-depth details of each customer interaction. Ideally, it will also integrate seamlessly with your cloud accounting, sales and marketing software.
- Build a sales funnel so you can automate when and how you’ll contact your customers at every stage of their journey.
- Incentivize loyal customers with a rewards or referral program. This is a powerful customer retention tool, as they motivate existing customers to remain engaged and drive higher customer lifetime value. Research conducted by Bain & Company shows that increasing customer retention rates by 5% increases profits by 25–95%.
And while you’re at it, keep an eye on your competition, too. Because, realistically, you’re only as good as how your value proposition stacks up against your competitors. You’ll need intel over time to be sure that you’re offering products and services that continue to outpace the competition.
Use these two tried-and-true business strategies to get (and stay) up to speed on your competition:
- Conduct a SWOT analysis: Mapping out your competition’s Strengths, Weaknesses, Opportunities and Threats against your own helps to clarify your unique competitive advantages and market positioning. It can also give you the insights you need to capitalize on growth opportunities and can help build the case for third-party financing, if needed.
- Collect competitive intelligence: Use digital platforms like AdBeat and Similar Web to uncover the ins and outs of your closest competitors.
As your business grows, you need to stay laser-focused on where you’re spending your time and money.
Check out how this FreshBooks Select customer was able to set themselves up for sustained and scalable success by making a few simple adjustments to their business operations.