Top Signs Your Business is Growing Successfully
Starting a business can be scary, but there is nothing quite like the rush you get when your business is doing well. All business owners know that attaining long-term success is no easy feat—if you grow too fast, you might not be able to keep up! If you don’t grow quickly enough, you might not make enough to keep your business up and running. While there is no perfect way to find that balance, you can calculate your working capital turnover ratio.
In order to do this, divide your annualized sales by your working capital. If you end up with a number close to 10, you’re in a good place. Anything over ten, and you are growing too quickly. If you are under 10, that’s alright, but if your business can’t keep up with the rate of inflation, then it might be lagging behind. Today, we would like to share some of the top ways to know that your business is growing well!
You are guided by cash flow
Growth should be adjusted only by your business’s ability to make and manage money. It should not be guided solely by making a profit. At its core, profit is simply your company’s ability to make more revenue than expenses in a month. However, as a company grows, that cash can be eaten up quickly by overhead costs and more inventory. Companies that are too profitable can actually grow so far as to put themselves out of business. Experts recommend making a weekly cash flow report to figure out where your growth rate stands. It takes less than 15 minutes, and it’s an easy way to figure out whether your company can pay the bills and the payroll the following week.
You have a strategy
A good business plan and a solid budget are the top ways to stay on track of your business’s growth. So many business owners are afraid to put together a plan, because they are afraid that if they don’t adhere to that plan, they are failures. However, no one is perfect. A business plan or roadmap is never going to line up entirely. Businesses that do not lay out a plan ahead of time, though, are much more likely to fail. Make a plan, update it frequently, and refer to it often. This will help you stay on the right path.
You want to be efficient over everything
If you are focusing solely on boosting your sales numbers, this will limit your potential for growth! Businesses aren’t just about your revenue growing; they are also about finding new opportunities to make your processes more efficient—which will, in turn, help you increase your net profit margin. Growing your top-line revenue figure is challenging, unless you offer something your competitors don’t in the marketplace. If that isn’t the case, then you are just taking customers from other companies. That takes much more effort than simply increasing your efficiency. Find a new way to give your customers value, and come up with innovative methods to grow both your bottom line and your customer loyalty.
You are willing to change to adapt to new business opportunities
Landing a new client is always exciting, but oftentimes, this will demand some upfront financial work on the side of your business. For example, you might need more inventory or even more staff to take on the project for you. If your clients pay you after work has been completed, then you will need to plan ahead to cover the costs before that check arrives. Be willing to change how you run things to account for new clients and options!
You ask for help from specialists
One of the top mistakes a business owner can make is to not ask for counsel from professionals. Talking to accountants, bankers, attorneys, and other business specialists is a great way to learn where you can improve on your current systems. Investing in great advice at the birth of a business is much more cost-effective than using your resources to fix a problem that could have been avoided in the first place. There is no one way to run a business well, but it’s always helpful to talk to your business-owning peers and see what is going right with their companies.
You think realistically about what you need
Businesses grow, and after awhile, you might run out of space. Be open to the idea that your business is simply too big to be run where it is. If it’s time for your company to make the move to a bigger and better space, we are the team to call. Washington Express Movers is here to help you transport everything from your old office to the new one. Our office movers are experienced professionals when it comes to ensuring that everything is transported quickly, safely, and efficiently. Contact us today to learn more about how we can help!