The past few years have certainly thrown quite a few challenges at small
businesses, with many reimagining and reinventing their business.
While tough economic conditions can certainly impact profits and cash flow,
many of the most successful businesses lean-in, embrace change and adapt to
market conditions to strengthen their business for the future.
If your business is currently renting its location or looking to expand to
additional areas, purchasing real estate can be a great way to invest in
your company’s future.
Owning your business’ property enables you to have better cost controls in
place and avoid potential price increases or restrictions on the work you
can do to the building that may come with leasing your space. One option for
businesses looking to purchase property is an
owner-occupied commercial real estate loan, which can provide cost certainty with fixed terms and rates, depending on
your lender.
Purchasing your business’ home can also unlock additional revenue streams,
like leasing additional space to another business or having a residential
tenant if you have a mixed-use location, you will just need to ensure your
business uses 51% of the space or more.
If your business’ cash flow is in a good place, reinvesting through
additional inventory can be a great way to set your business up for future
success.
Take stock of your inventory and customer purchasing patterns and consider
ordering more popular items in bulk to
look for potential vendor discounts
as well as handle seasonal spikes in demand.
Inventory can be a balancing act – you don’t want to over-purchase and
strain your cash flow while having products sit in storage – but optimizing
it can contribute to your business’ short- and long-term success.
Upgrading your business’ equipment and software can be costly upfront but
can provide a host of benefits to the business as a return on the
investment.
Technology continues to rapidly advance, which is a great thing, but can
also lead to equipment being outdated more quickly. Investing in upgraded
equipment and software to replace aging, outdated systems can save money on
repairs as well as streamline your operations to help save time for you and
your employees.
Your employees and your customers are your most valuable asset. Investing in
their happiness can go a long way toward building sustainable success.
If your business is in a good place financially, look into the benefits
you’re currently offering your employees and ways you can enhance those.
Providing solid benefits – like retirement contribution plans, additional
PTO time, bonuses or educational opportunities – can go a long way in
promoting employee happiness and reducing costly turnover.
Speaking directly with your employees about the benefits that matter most to
them can also be a good way to build a strong culture and provide the
resources they need to be successful professionally and personally.
Don’t forget your customers either! Reinvesting profits by offering customer
incentives like buy-one-get-one deals or reward points to redeem in store or
online can help build loyalty and increase future sales.
There are many ways to reinvest in your small business to make it stronger
and more resilient for the future. Speaking with your business’ support
system, including your banker, accountant and other advisors, can be a great
way to put a plan in place to help your business grow.
Jeremy Shackleford, Senior Vice President, Director of Small Business Sales
