Do you know your safety net... Here are 3.
Small business owners are risk takers that are willing to not have a safety net designed and maintained by corporate america or anyone else. But what some small business owners may not think through is that their safety net shouldn’t come from just one revenue stream. Corporations and big business have figured this out by have a diverse flow of cash coming in from more angles than you’d ever think of..
Small businesses need to adopt that same mindset. especially during the first 10 years. Stats everywhere on the internet inform you that 70-96% of businesses don’t make to a 10 year anniversary. Our research has shown that most small businesses only have 1-3 revenue streams. One may be a product line, then other may be a service line and the last may be a referral partnership line. Below are 3 tips to help you make it 10 years.
1) Develop a side-hustle mentality - Knowledge is power and when your running a small business you want as much knowledge as possible. Books and school can help but no better knowledge exist than real world knowledge. Find another business in your industry, work out a collaboration effort where you trade for knowledge. Or look at the product or services you offer and look for opportunities to offset your direct cost through an affiliation or sponsorship model.
2) Budget, Budget, Budget - Budgeting is so important we wrote it three times. Even if you don’t have a financial background budgeting is very simple. Write down all your expenses monthly, write down how much you bring in and make sure to average out expenses that are not monthly into a monthly dollar amount. The businesses that do this (and stick to it) become 62% more likely to survive past 10 years.
3) Save, Save, Save - After budgeting you must diligently save money. It can be hard when you think of things you need or can use to grow your business. But that’s what a budget is for. When you see something that can help your business, don’t run out and swipe a credit card or take out a loan. Save for it by allocating some revenue every month until you’ve saved enough to purchase it. Yes you may miss out on some sales deal but guess what, when you pay for things in cash (especially in person) you can usually get a better deal. Want to know why, you’re saving that other business money that’ll be tied up waiting for you to hopefully make all your payments.
We hope you take at least two of the three above tips and apply them. You’ll build a nice safety net which will actually give you more buying power, stability and security. That’s what we call a safety net.
We’d love to hear how you’ve adopted our tips by contacting us and letting us know how you’re doing.