One of the biggest early goals of startup business owners is to get money coming in. There are a lot of costs involved in setting up a business, and the sooner you start earning revenue, the more you can afford those costs.
There is an element of patience involved, but there are also things you can do to promote cash flow in your small business.
The more stable you are, the quicker you can grow. It’s not always about finding more customers, but improving the experience of your current customers can make a real impact on your revenue line. Invoice financing is a great way to promote cash flow that helps you to grow even more.
Importance of small businesses for NZ’s GDP
Small businesses make up a significant portion of all firms in New Zealand. They are defined as those with fewer than 20 employees, and many of these are further categorised as startups.
With approximately 530,000 small businesses in the country, they make up 97% of all New Zealand companies, and 98% in Australia.
The Ministry of Business, Employment and Innovation reports small businesses contribute more than a quarter of New Zealand’s GDP each year. Around 28 percent of employees work at a small business.
Why do small businesses need to increase revenues?
Improving cash flow for small businesses is often high on the list of priorities. Getting more revenue helps in a range of ways:
- To pay bills or rent
- To purchase stock/inventory
- To pay staff wages
- To invest in plant or equipment
- To give the business owner a personal income
- To put towards marketing campaigns that bring in even more revenue
- To repay loans or creditors
Revenue is also a form of feedback on the businesses performance. The more revenue you have coming in, the more encouraged you can be about how the business is going. It’s always nice to look at your bank balance and see money coming in!
What does it mean to increase revenues?
Revenue is any money that’s coming into a business. There are few different forms of revenue, but the most common is from sales. For the purposes of this definition, sales includes selling physical items or selling the businesses service – whatever its core business is.
Other forms of revenue include income from investments or bank interest.
A company can grow revenue by adding new income streams or increasing the value of its sales. This may mean selling more items, or raising prices so there’s more money coming in.
10 tips for startup businesses generate revenue
So how can startups generate more revenue?
Adopt a growth mindset
Revenue is the result of the business; when things are going well, revenue grows. Focusing on money as a metric can actually hold businesses back because they make decisions based on finances, not what’s best for the long term growth of the business.
Develop your brand
The brand of a business is what helps it to differentiate itself from its competitors, and attract its target market. Developing brand messaging that is engaging and authentic is a good way to find new customers or clients, and grow long term relationships that translate to more revenue.
Use invoice discounting for paying bills
Invoice discounting is a clever way of getting short term funding for small businesses. By selling some of your invoice to a company like FundTap, you can get revenue now instead of waiting for your creditors to pay you.
By getting invoices paid quickly, you can use invoice discounting to get the cash to spend on your business, and grow your revenue even more. For example, businesses that use FundTap grew their revenue by 54% over the last two years.
Add new payment forms
Different customers and clients will have different payment preferences. By having their preferred payment options on your invoice, they’re more likely to pay them faster. Cash exchange apps or secure payment options are modern payment options that more and more people use.
This is a quick tip that doesn’t cost you anything and can help your short term cash flow.
Increase your qualified lead flow
If you’re happy with your sales funnel and have the capacity, then you can widen your reach to bring in more business leads. Growing referral programs, launching paid ad campaigns and growing your organic reach are all ways to access new markets.
Revisit your pricing strategy
Adjusting your prices up or down can help to bring in revenue in two distinct ways. Increasing your prices increases your margin, and if you sell the same amount, you’ll earn more revenue.
Lowering your prices means you’ll earn less for each sale, but you may attract more customers and end up making more money – especially if you do it alongside a marketing push.
Read more: See more efficient small business tips
Clarify your messaging
Your marketing is a key lever in your revenue – you can activate a marketing campaign whenever you want to promote your small business. However, in order for it to be as effective as possible, your messaging should be engaging, clear and concise.
Once you’ve developed messaging you like, you can launch marketing campaigns you have confidence in.
Use short-terms financing for quick cash inflow
A range of short term small business loans are available for startups that need a quick cash injection. Unsecured short term loans for small businesses are easy to apply for, can be quick to approve, and have no repayments for the first few months.
Plainly, these small business financing options come with interest that you’ll have to pay back, but if you’re planning on using it to grow your business then getting a loan is a good option.
Foster customer and brand loyalty
Loyal customers mean repeat business. Attracting customers once is no small achievement, but once you’ve done that it pays to do everything you can to entice them back.
Showcase the good things you’re doing on social media and spend time developing good relationships with customers. The time you spend doing these kinds of things will translate to more revenue for the business.
Change shipping or delivery charges
If you’re an online store, reducing your extra fees is a great way to give your customers something for nothing. Customers love getting a discount, and this can help to convert online sales.
You may be able to build shipping or delivery charges into the price of your items instead.
Take home message
With so many different ways to grow your startup’s revenue, it can be hard to know where to start.
FundTap is here to help create a world where it’s easier than ever to succeed as a small business. Our mission is to turn traditional finance on its head so small businesses can instantly access their money when they need it to thrive and grow.
By getting your invoices paid in just hours, you can use this cash to fund ways to increase your revenue for minimal effort. This means you can free up time and money to grow your business even more.
It’s easy to see how it works too. Connect to a demo account, book a free 15 minute demo direct into our calendar or sign up for free today.
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