Your Business: Where Should You Invest First?
Starting off your business is extremely exciting.
You’ll be learning new things every day and finally working for yourself.
However, it’s important to avoid the traps and mistakes that many new business owners make.
One of these is to overinvest.
During the first few weeks of excitement, it’s easy to invest in everything. A small investment here, a small investment there.
Then at the end of the month, you look at your finances to find the bank is looking somewhat… empty.
At James Hopkins Coaching we make sure that new business owners can avoid this mistake, providing them with tips on where they can make the best investment in their business.
The first thing you should do before investing any of your finances is to create what is known as a ‘cash buffer’.
Simply take a portion of your profits and set this money aside for any unexpected events or emergencies.
It’s ideal for making up any shortfalls in payments or late payments.
As you begin to grow your business, you may require cash to make payments, if a client pays you late, you can use your cash buffer to make up for the problem.
This prevents any additional costs and is something we emphasise having at James Hopkins Coaching.
After you have created a cash buffer, we suggest investing in yourself.
Expanding your knowledge and skills is an investment that pays back tenfold.
These new skills will allow you to run your business more efficiently.
At the same time, they will allow you to improve other areas of your life which will improve your overall happiness and ability to achieve success.
Self investment comes in many forms, including books, seminars, coaching and online courses, all of which will help you to improve your skills and consequently your business.
After building a strong foundation with a cash buffer and self-investment mindset, you can begin investing in marketing.
Marketing investments can provide you with some of the greatest returns.
The James Hopkins Coaching team advise that you first assess how much you can invest in your marketing as it’s important you don’t overinvest.
Make sure you diversity your marketing investment without spreading yourself too thin as this will likely hinder your results.
Find the perfect balance for your business and you can begin significantly increasing your profits and improving your ROI.
As your profits begin growing steadily you can begin investing in your team.
The bigger your business grows, the less time you will have on your hands- this is when you begin building the team you want to work with.
Investing in your team is extremely important as it will empower them to work more efficiently, whilst feeling cared for as an employee.
Examples we use at James Hopkins Coaching are education and training courses, as well as leisure activities and internal celebrations as these will help to keep morale high.
The better your starting investments, the stronger the foundation you create for success in the future!