In today’s climate, funding can be very important to your business either to grow it further or help with new developments via Research and Development. So, let’s take it in two parts:-
Growing your business:-
When it comes to growing your business, what are looking to achieve? Growth be taken in many ways:-
- Increasing the brand awareness of your business
- Increasing productivity
- Increasing sales
- The expansion via staff
- The expansion via office/building size
So, which way do you prioritise the above? Things you really need to consider are:
- is that if your are wanting to increase your sales, do you have the brand awareness to get recognised?
- if the awareness is there, what is happening to your sales – are they flat or growing?
- if the sales are there, do you have the necessary manpower to deliver those sales?
- if the sales are being delivered, can you meet the output required?
- if the output can’t be met, is it down to staffing or the space required?
As you can see, these are the simple steps you need to consider before embarking the growth of your business. The growth of your business is dependent on the points above, so sit back, grab a piece of paper go through the above to see where you are.
Research and Development:-
What is Research and Development (R&D)?
This can take two parts as it can cover the opportunity to find new markets to sell your products and services to or turning new ideas into products or services to sell but how do you consider the next stage:-
When you are looking into R&D for developing new products or services, make sure you have your ideas broken down in two sections – one a simple single page outlining the idea and second, a complete breakdown by expanding the single page into a least a three page overview covering the idea, the requirement to turn the idea into reality, the requirements of delivering the project and finally how you will deliver this to your prospective clients.
When you have a new product or service to deliver to your prospective clients or your existing client base, what do you? Firstly have you considered market testing? Could you do this by an incentive?
Once you have the basis of the idea:-
- speaking to your existing client base is a good safe way to start with little expenditure
- look at your clients and see what they do and find clients that either use or you think could use your service or product
- choose a number of them, say 5 to 10 depending on what you feel is best sample to give you results you will be looking for
- offer them an incentive linked to what they already purchase from you (this way, the cost is only the purchase cost of that incentive)
This market testing provides two opportunities for you on top of sharing the new idea with them, a way to create a possible up-sell of your products to them and also get feedback from them on how they see your company and the way it operates.
In summary, these two overviews will give you a few ideas to consider on how you need to focus on which way to more forward when considering “Funding and Growth”. Make sure that you fully understand how both are looked at differently before looking to seek increasing your borrowing to fund further growth. Many banks or finance companies will be offering “borrowing to fund growth” as a way to grab your attention but carefully consider this before taking their money. This funding may be an easy option but is in the end? You truly need to carefully consider this as banks and finance houses do not always the full solution. It may suit you to receive this money, but what else is there besides their cheque or cash deposit? Thus, start looking to other options of where funding comes with support from people with the background to help. This can be outside investors or crowd-funding but how will they help you? Now that is a completely difference story…..
I trust that this article has helped you and please do not hesitate to comment on these topics to discuss this further