Welcome to the latest blog in our series all about the importance of entrepreneurs developing the right level focus in order to maximise their business’ growth potential.
In today’s blog we are focusing on the importance of managing cash flow effectively so as to ensure that businesses have the necessary growth capital to unlock their true potential, particularly in the RUN phase and beyond.
With the help and support of your experienced coach, you can also expect to see significant improvement in cash flow as you navigate the RUN phase of your growth plan.
Against a backdrop of increasing sales and a more consistent pipeline of higher value sales you’ll work hard to improve your overall cashflow by focusing on your key cashflow drivers namely; your accounts receivable days, work in progress days, cost of goods sold and overhead percentages.
By way of example, you can expect to see significant improvements in cash collections.
Having assessed the most appropriate approaches for your business you’ll adopt a number of different tactics that may include options such as;
- Invoicing immediately
- Offering incentives for advance payments
- Taking cash with first orders
- Taking deposits
- Asking for staged payments
- Accepting credit card payments rather than invoicing
- Improving and/or Outsourcing cash collections
- Offering early payment discounts
- Charging interest on late payments
- Focusing on recurring payments
- Revising standard payment terms
Similarly, by implementing greater rigour to the accounts payable side of your business you can expect to see significant improvements in cash flow again by applying tactics such as;
- Regular cost reviews
- Negotiating supplier discounts & longer payment terms
- Delaying non essential purchases
- Reducing inventory levels
- Drop-shipping products direct from supplier to customer
- Cutting out non value-add marketing expenditure
- Cutting out non essential travel & subsistence
- Moving to electronic invoicing
- Developing a regular and consistent debt chasing process
The net result of improved cash flow in your business will be a business that has even greater cash resources and is subsequently able to accelerate its growth rates even further, hire better people, invest in new initiatives and technology and, should you desire it, provide you, the owner, with even greater personal drawings, pension contributions, and overall financial security.
No matter what stage your business is at entrepreneurship is not without its challenges. At each and every stage the challenges are different, bring different levels of complexity whilst decisions take on different levels of magnitude.
Having successfully navigated the early stages of your business the attractions of kicking on and building a profitable, sustainable business are immense.
After months, if not years, of hard work you’ve not only survived but have reached a point where you’re now ready to create an even bigger and more sustainable business.
The big questions are simply;
- HOW do I create that business I’ve always wanted?
- Do I have the knowledge and skills to create it?
- How do I create it without costly mistakes?
- How fast can I create it without working crazy hours?
With the expert help and advice of an award-winning coach you’ll learn how to build;
- A more consistent pipeline of ideal customers
- Increased numbers of higher value customers
- Greater levels of repeat business
- Greater levels of brand recognition
- Improved cash flow & profitability
- Greater levels of control from a more systemised and process driven business
- A growing team/business that’s less reliant on you
- A significantly better work-life balance
Ambitious entrepreneurs who are serious about growing their businesses and reaping all of the rewards, know that the only remaining question they need to be asking themselves is …. How soon can I get started?!
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Understand what stage your business is currently at, and get a bespoke report that will help you take it to the next level!
As businesses grow, they invariably face some very specific challenges. Understanding how best to address them, in what order, whilst also identifying the opportunities associated with these challenges is a critical part of unlocking your business’ true potential.
As your business learns how to successfully navigate this RUN phase the many challenges that have dogged your entrepreneurial journey to date will start to fade.
Memories of the endless days of worrying about where the next customer is going to come from or of when you were frantic to work out whether you’d be able to pay suppliers, staff or even yourself at the end of the month start to become just that, a distant memory.
The same is true of the memories of those excessive hours that you had to work to simply keep the business afloat whilst all around you seemed oblivious to the stresses and strains that you were working so hard to hide from them.
Either way – as you begin to find your rhythm in the RUN phase you will begin to enjoy all of the benefits of a business that is growing consistently, generating a healthy profit and building a stronger cashflow position month after month.
Along with the knowledge that your business is finally starting to really work comes the added confidence and satisfaction that you can now start to enjoy the financial rewards of all of your efforts. Alongside this increased financial security comes the additional benefits of greater levels of choice, independence and control over how you invest your time. For the first time perhaps you don’t actually need to work an 80 hour week.
Perhaps you can even take a 2 week holiday without feeling guilty and worrying about what you will come back to!
Irrespective of what stage of the entrepreneurial journey you and your business are at, the challenges of running, growing, scaling and potentially even exiting a business are frequently both multiple and complex.
For many, it’s far more than just a question of time. It is a question of knowledge. Put simply none of us know what we don’t know!
Whether it’s our business knowledge, our opportunity specific knowledge or our venture specific knowledge as business owners we’re frequently presented with new and ever more complex challenges.
If running and building a successful business were simple then needless to say everyone would be doing it. For many of us, it’s about building a valuable support network comprised of both an experienced mentor/coach alongside a close knit group of peers.
Want more great content like this? Check out our latest eBook today!
Download a free copy of our eBook “Why So Many Businesses & Ambitious Entrepreneurs Fail to Achieve Their True Potential” today!
It’s packed full of practical and easy to implement strategies that will help you “Avoid the Pitfalls” and drive your business to the next level!
If One to One coaching/mentoring isn’t the right solution for you and your business then don’t despair.
The opportunity to work with our award-winning growth experts is still within reach.
Following years of working with entrepreneurs across multiple industries and at varying stages of their entrepreneurial journeys, we have created a number of group coaching programmes to suit each and every business.
For CEO’s and Managing Directors who are wrestling with the magnitude and complexity of daily operational and strategic decisions, or perhaps struggling with ever changing market dynamics and levels of competition, we’ve designed our Virtual Boardroom Programme.
Similarly for entrepreneurs that are focused on delivering super-normal levels of growth year after year we’ve created a unique peer to peer learning experience and support network called the Scale Up Institute.
Finally for those businesses that are now looking to establish a more consistent level of growth and profitability with the help and advice of our growth experts we’ve developed what we call our Growth Academy.
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Why not get in touch with the team today? We’d love to hear from you!
We’re truly passionate about supporting business owners like you overcome your challenges and unlock the true potential of your business. If you’re looking to drive your business forward, get in touch today!
DON’T MISS the next blog in this current series where we explore the importance of ambitious entrepreneurs focusing on building their business, entrepreneurial, opportunity specific and venture specific knowledge in order to succeed.