Strengthen sales pipeline process
Is there a structured flow from enquiry to lead to sale? How are prospective opportunities captured and then fed through to the right person to follow up? Are there any weak areas in the whole workflow? If so, you need to get these ironed out. Get a specific process in place to make sure everything is followed up and actioned as quickly as possible.
So many businesses fall down on this level. And let’s be honest there’s no business around that’s not in business to make money. Your sales pipeline is everything. Get a good CRM system in place, along with qualified employees that care about what they’re doing and are passionate about the service or product. Marketing automation is another consideration. But make sure that your team know how to implement these tools intelligently.
With a solid client acquisition process in place, you’ll avoid frustrating prospects because no one’s followed up with them (at least in a timely manner). Having to re-explain what they want to multiple people is another irritation. Be ultra-efficient at every stage in the process. They’ll judge you on the experience they have with your company. And we all know that first impressions count.
Establish a clear expense policy
Having an expense policy in place and communicating that to your employees will help to guard against unauthorised spending whether it’s products, services or spending limits. You don’t want unexpected bills for five star hotels, first class travel or excessive entertainment costs. By setting clear boundaries, employees know what’s deemed correct behaviour when spending company money.
At the other end of the scale, employees might purchase items that are essential to their everyday job or running of the department. For example, purchasing replacement stationary or similarly items that every business needs. If everyone is doing this separately, then this may add unnecessary cost.
Purchase from a preferred supplier and buy in bulk to ensure you get the best price. If there’s one or two people that can be designated to deal with this on behalf of the company even better. Any purchasing that can be centralised is a good idea.
Where legitimate expenses need to be claimed, the best approach is to do this electronically. It’s easier all round for everyone because you’re not dealing with paper receipts and rekeying of expense forms. Plus, an automated system with workflows and alerts in place helps to stop maverick buying behaviour. The more staff you employ and the more you grow, the more expenses you tend to accrue. Getting the balance right early on will help you in the long run.
Polish up your negation skills
Too many companies are not prepared to negotiate on price. If you’re not negotiating, then you can bet that you’re overpaying. It’s definitely a common practice in the B2B space so you shouldn’t be afraid to do this. If you don’t, you’re literally throwing money away.
It’s worth encouraging staff that are responsible for purchasing of any kind to get better at this skill. Your sales people should be incredible at this in any case, otherwise why did you take them on?
Good negotiation skills will benefit your company, save you money and help you to grow. Remember most things are negotiable – the results of which add up over time. Whether you’re negotiating with a supplier or on a business deal, it’s the one thing everyone in the business would do well to get good at.
Make your money grow
If you’re lucky enough to have a healthy inflow of cash, what’s happening with that money? Is it sitting idle in your bank account?
If you’ve already met your plans to reinvest in the business or put some aside for other means, then speak to an advisor if there’s money still left over. Look at how the surplus cash can be invested and see what tax advantages you can gain to minimise costs.
Get all your money working for you. By not discussing the options open to the business, you could literally be bleeding thousands of pounds because of it. There may come a time when you want to use some of the cash for later expansion plans such as mergers or acquisitions, but until then you should do everything you can to make sure that you’re getting the best return on your money.
Know your numbers
We can’t state that enough. It’s the only way that you’ll get an idea of what’s going on in your business and its true financial health. Not doing so is a sure fire way to losing money.
If you don’t have a clear idea of your costs and sales and you’re not getting updates in real time, that will cause problems for your business at some point. Many financial problems can be fixed if you’re aware of them early on.
When you know your figures you can see:
- where there’s overall room for improvement or additional opportunities
- the trends in sales figures, for example, by geographic area or sales person
- whether you’re dependent on one supplier or client, and the impact this might cause
- any successful projects or activity that could be replicated in other areas
- if there’s any projects that are heading towards financial difficulty
When you’ve got the data to answer these – and the myriad of other questions that might be relevant to your business – then you’re on the right track. If you haven’t then make it a priority to get to this position. It’s the only way to ensure that money is being put to good use and not being allowed to haemorrhage from the business. It’s well worth the effort.
The key to avoiding bleeding cash is not just about cutting spend. It’s about rooting out inefficiency, understanding costs and revenue sources; it’s also making sure that everyone’s efforts are focused on doing the right things. Know what opportunities to invest your time and money in – and those which are costing you money. That way, you’ll safeguard your cash position to better support the financial and growth interests of the business for years to come.