3 Foundational Investments Every Small Business Should Make
In business, we sometimes have this chicken or egg situation where it takes money to make money. More specifically, every small business needs to make investments in order to keep growing. This requires putting money down in hopes of a return.
While there are several ways to get funding, many small business owners are bootstrapping. This means they are probably starting with their own money and then reinvesting the revenue that comes into the business. This may also mean they don’t have as much capital as other businesses so they need to be more careful.
That being said, I often see small business owners who either refuse to invest or spend money on the wrong things. Here are three investments every small business should make for guaranteed success.
I recently interviewed my web designer for my podcast and she brought up a great point. She basically said many business owners want to skip the marketing research phase because it isn’t sexy. Or, at least, it’s not as sexy as design.
I’ve also noticed this to be true. People dread doing proper market research, especially if they are just starting out. But the reality is you can’t run a successful business unless you know your market better than they know themselves.
That’s why every business owner needs to invest time and money into proper market research. I would also venture to say that business owners can’t really hire this out because no one will understand their market better than they will. It may also be a waste of money because a marketing company won’t be as invested as you are. That’s why a small business would be far better off investing in a mentor or training program that helps them gather this information.
The other area where I see small business owners cringe is sales. Again, it’s not sexy. In fact, for many, it’s down right nauseating. The problem is you can’t have a business without money and money comes from sales.
This is why every small business needs to invest in sales training. In my experience, small business owners usually hate sales because they have no idea how to do them properly. They also likely haven’t had many experiences where others do them properly either. This is why small business owners make assumptions about sales that simply aren’t true, like that sales are pushy.
The first step in overcoming this is to understand how sales actually work. The second step is to get training in effective sales techniques. The third step is really just confidence. A small business owner can get all of this and more by investing in the proper sales training.
Another area where small business owners must invest for success is the proper payment systems. After you’ve got the marketing and sales down for your offering, you need an easy way to collect the money.
Small business owners sometimes push back on me with this stating they don’t want to pay credit card fees or that clients want to pay in checks. First, it’s better to lose a portion of your payment than to lose the entire thing because someone doesn’t get around to writing a check. Second, you can educate clients on why it’s often times safer to use credit cards.
Small business owners often jump to invest in things like design and branding before investing on a proper foundation. This is totally backward and will lead to losing more money in the long run. Instead, business owners should invest in the things that will actually move their business forward.