Surprising-Yet-Common Reasons Small Businesses Lose Money

Surprising-Yet-Common Reasons Small Businesses Lose Money

on Jun 10, 2020 in Small business

It’s not surprising that small businesses have problems with cash flow. Be Media reports that 97% of Australian companies are shutting their doors, which is a shocking figure. Entrepreneurs understand they need to be careful with their money, but what’s weird is where the resources go missing.

 

Mostly, firms put it down to mismanagement, such as choosing a third-party without doing the necessary research. Although this is problematic, there are more weird and wonderful ways to fritter away your much-needed cash.

 

The following will help you to realise whether you’re culpable, and what steps to take next.

Locked Safe

A safe is a fantastic way to keep physical valuables secure. Unlike your bank balance, there’s no way a thief can steal them unless they have the code. Unfortunately, some businesses may safeguard their assets too effectively. Commercial Locksmiths points out that some companies haven’t opened a safe in twenty years. That’s a long time to wait! Plus, it’s a waste because A) it’s not being utilised properly, and B) it’s not collecting interest.

 

With the help of professional locksmiths, you can regain entry to your safe and invest some of the money for the sake of the business. That’s why you have a rainy day fund.

 

No Logo 

It’s amazing how useful a logo is in the 21st-century. The reason a brand symbol is a powerful tool is the perception of the public. The majority of people associate logos with huge companies such as Nike and Apple. As such, SMEs can take advantage of investing in a symbol and making the company appear bigger and more professional. You’re essentially piggybacking off the success of multi-billion dollar businesses, which is weird because you wouldn’t assume you’re connected.

 

But, you are, so it’s surprisingly useful to purchase a logo to raise awareness of the business and boost sales.

 

Only Digital Marketing

Are you surprised that you can lean on digital advertising too aggressively? Sure, it’s never wise to put your eggs in one basket, yet SEO and PPC are infallible, or so entrepreneurs believe. The reality is that, while search engine optimisation is powerful, it works best in a strategy that complements its flaws. A prime example is making a first impression. SEO may lead more people to your website, but nothing beats a handshake and a face-to-face meeting when it comes to a charm offensive. Your brand will always be memorable with a friendly smile and a sharp business card.

 

Biz Cover has more examples of offline marketing tactics that are incredibly useful.

 

Not Following Up

Surprisingly, lots of businesses generate opportunities to convert customers and fail to capitalise. Why? It’s because they are too lazy to follow-up and encourage a sale or a registration. 44% of sales reps give up after they fail to connect prospective consumers after one or two tries – it takes five interactions for a single conversion.

 

You’ve got to put in the effort, as customers won’t magically fall on your lap and give you their money!

 

 

Image credit:  Pexels.com

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