Entrepreneurs Lose Money In Strange And Mysterious Ways: Here Are Just A Couple
The importance of cash flowThe following article is a guest post and may contain affiliate links:
Maintaining cash flow is an important part of any business. Without it, you’re screwed. But many entrepreneurs go about their daily lives on a wing and a prayer, hoping that somehow, somewhere, they’ll make some money. Is this the best strategy? Probably not.
For many entrepreneurs, it’s not so much about making money as it is about avoiding losing it. Many get so busy that they forget to attend to the basics of their business. They end up losing money through bad pricing, underpricing and in a host of other ways.
Here, we’re going to look at how you could be losing money in your business venture, and what to do about it.
Lose Money Strategy 1: Failing To Think Strategically
Getting strategic thinking right is important. It can mean the difference between success and failure. But strategic thinking is harder than most entrepreneurs appreciate. Often entrepreneurs think that being successful in business is just a process. The more steps along the process they walk, the more likely they are to succeed.
But business is more dynamic than this. Say, for instance, you run a technology business. You want to know whether it’s worth investing in an idea today for a product launch, sometime in the future. Most companies will immediately rush off to start the design process and invest in prototypes. Then, when it comes to actually making the product, they find that the technology simply isn’t ready yet. Ultimately, the idea tanks, and when this happens, the business can go down with it.
The trick here is to time your business decisions to meet the market’s needs. You want your product to be ready to go at precisely the time that the market is ready to support it. There was no point trying to launch a social media site back in the 1990s. There simply wasn’t the bandwidth to support it. Come the mid-2000s, however, and the opportunity was therefore the taking.
Lose Money Strategy 2: Failing To Maintain Equipment
Companies like Pirtek know how important it is to maintain equipment. Equipment breakdowns are costly, can hurt employees and can derail operations. The problem for many entrepreneurs is staying abreast of these lesser details of their business. Your equipment might not be the sexiest part of your business, but it’s among the most important.
So what can you do? First off, segment your time. Allocate some time each day, without interruptions, to overseeing the processes in your company. Don’t focus all the time on landing the next contract or making the next lead. Check that your systems are fully operational and in good working order. Second, hire somebody who knows what they’re doing when it comes to machinery. There should be at least a couple of people on your team who are capable of diagnosing problems.