The top business investments will help to ensure that your business keeps moving in an upward trajectory. Once your business has surpassed the “threat of failing” years, it can be easy to fall into bad habits and not continuously look for those top business investments that will shore up growth.
For example, are you investing in your employees? Offering health insurance that cares for the whole family and one’s mental health can make your company a more desirable place to work for among the competition. Mental health counseling and anxiety treatment are becoming increasingly necessary in a stressful working environment. As more businesses adopt new healthcare packages, including therapy along with your coverage for a family physician can help inspire new employees to apply and encourage them to stay longer.
The fact is it is vital that your investments for your business evolve on a continuous cycle. There is no finish line when you can stop thinking about the top business investments and how to parlay them into success for your business.
The Evolution of Business
All you have to do is read the headlines to know that without proper financial management and investing those business finances in the right areas, your business can fail. Take a look at the giants that have fallen in the last decade after, in some cases, a century or more in business. The top business investments ensure that you are putting money where it matters.
The evolution of business is similar in every industry. It comes in three phases, startup, establishing secure footing, and growth. Typically, the growth part is where business owners tend to sit on their laurels too long.
Keeping your company on the right track means evaluating the top business investments, investing, and enjoying the return until the next opportunity comes along. Each phase of business evolution has its own set of top business investments. For example, in the start up phase some of the top business investments for your company are made in marketing. Social media marketing, SEO, and more is vital at this stage because it brings your customers to you and gets the word out about your business.
What Are The Top Business Investments At Each Phase of Business?
Let’s say you are starting up a screen printing company and you want to make sure that you are making the top business investments at this phase of the business. This kind of company can also be great for making you merchandise when your own company gets off of the ground. In the early days of getting your business off the ground, you will have two main categories that you will need to divide your investments into.
The first category is the infrastructure of your business. What is the infrastructure of your business? In any industry, you will need tools of the trade, equipment, and a location. That is the infrastructure of your business.
Let’s use the screen printing company that is in Hawaii as an example. Here are the top business investments for the first category (infrastructure) that you will need to make:
- You will need voice hosting services to communicate with your customers.
- You will likely need to invest in professionals that can assure your equipment has the power that it needs to operate safely.
- You will need to invest in your equipment, and start up stock to be ready to fulfill orders.
A call to Hawaiian telecom will ensure that you have the communication infrastructure that you need to open your business, but that is not the only utility you will need to consider. Are utilities going to be a major business investment? No, but they are some of the top business investments you will need to make for the infrastructure of your business.
You may have to add in the cost of electrical contractors if the wiring in your workspace is not up to par. Infrastructure investments are critical to ensure that your business can carry out the actual function of the business.
Of course, in some cases, the industry will require other infrastructure investments. For example, if you are starting your own hosting service or IT support firm. In that case, you will have to consider air conditioning for data centers as one of the top business investments in the early stages.
Predominantly the top business investments in that critical first category stage are going to be the investments that help to structure your business. The ROI that you get from these investments are continuously paid out over the lifespan of your business. In other words, if you do not make these investments you are taking the risk that your business will not get to the next phase of the evolution.
This category can include things like buying pallets for sale, warehousing space, connecting with a fulfillment center, buying inventory, and if necessary hiring staff. This period is focused on the basics of your business and the tools that you will need to conduct business.
The Second Category of Top Business Investments In the Startup Phase
The second category in the start up phase of the top business investments is all about branding your business. The bulk of your investment in the second category (marketing and branding) is going to cover the costs of getting out the word about your business.
Here are some of the top business investments you can make in your startup phase:
- Building a website. Today, it is imperative that your business can be found online. A website is a foundation for every other marketing ploy. You will never regret investing in a professionally designed website.
- Marketing campaign. The fact is word of mouth is still a great way to drum up business, but it is not a stand-alone path to success. A marketing agency will help you to brand your business and reach your target audience.
- If you are in a brick and mortar location, signage is a must.
One of the most important investments a new business can make is in a solid marketing plan. If you are in an actual building, that may include hiring exterior contractors to put up signage. Your business has to have a client base to be successful, marketing brings them to your door.
Phase 2 Of Business Evolution and Top Business Investments
During phase two of your business evolution your business should be leaving the risky phase of startup. This is the phase where your business starts to turn a nice profit and feel more like an established business. It can take a decade in some cases to get to this phase. What are the top business investments once your business is established?
This can be a type of “wash, rinse, repeat” phase. During this phase, you should evaluate your business tech to ensure that you are taking advantage of all the tech that is available. According to the experts, your website should be audited every three to five years and upgraded as needed. It is also a great phase to reevaluate your marketing strategy. Marketing and technology are always among the top business investments to keep your business competitive and on the right path.
What are the other top business investments at this phase? Here are some places you should be thinking about investing some of your cash flow:
- Training and employee benefits.
- Business enterprises that can create multi streams of income.
- Improving processes of your business by upgrading equipment.
Once you have established your business you will have more wiggle room for where you can invest some money. Human capital (your employees) are one of the top business investments. Fostering loyalty and job satisfaction among your employees is incredibly important if you want to attract and keep the best talent.
Offering group health insurance plans, 401K investment options, and more can help to keep your employees happy. Happy employees are productive employees. Productivity is key for business growth. Putting money back into your business by way of employee benefits is something that will deliver a nice ROI.
During this phase it is also a great time to evaluate how you could be bringing multi-income streams into your business. This does not necessarily point only to expansion, in some cases, it can mean investing in an entirely new business.
The question at this phase is “how can I use the profits I have to generate more revenue?” The top business investments are the easy answer like investing in your staff through training and benefits or upgrading equipment, but that is not the only way to turn your revenue into more revenue. Sometimes thinking outside the box is the best way to go.
Phase 3 And The Top Business Investments
You did it, you started up from nothing, you established your business, and now it is time to kick the growth into high gear. The biggest question during this phase is “how do I take my business to the next level?”.
Some of the top business investments during your phase 3 growth period include:
- Expansion across the board. If you sell products, expand your product offerings, if you sell services, expand your service offerings. If you have a store this may be the time to open that second store. Expansion is how you up the ante when it comes to growth and driving more revenue.
- Get creative. Not really wanting to take on more stores, or more services? That’s okay. You can expand your brand without having to do the work. Consider franchising your brand.
- Get serious about your business investments. The top business investments are not always tangible. Where are you keeping your money? Are you earning on that money? Who are your vendors? Are they delivering rebates and discounts that you should be earning?
At this stage, expansion is the best way to grow your business. Expanding what your business has to offer, can help you to grow your business exponentially. It is less costly to expand than it is to startup. You already have one of the biggest risks controlled. You have the customer base. It is a lot easier to introduce new products to an already existing customer base.
If worrying about growth has sent you to your family physician for anxiety treatment, then turn the growth management over to the professionals and franchise your brand instead of worrying about expanding it on your own.
Franchising is a win-win situation. Your brand gets spread across a wide demographic (think McDonald’s) and you get to reap the rewards. Franchising is an almost altruistic business model. You get to help people own their own business, while generating a nice chunk of revenue, and your brand gets spread around the world.
This is the time to really take a look at who you are doing business with. Success is power when it comes to vendors and suppliers. A lot of business owners make the mistake of staying with those first vendors and suppliers that took a chance on them when they were starting up.
It is great to be loyal, but not at the expense of your business. Now is the time to start making phone calls to find out exactly how much you are overpaying to those vendors that came on board early on and charged you a higher rate because of the risk involved with doing business with a new business.
Of course, if you insist you can give those “gave you a chance” suppliers and vendors an opportunity to price match, but keep in mind a dollar saved is a dollar earned. A consistent auditing program of what you are paying out to vendors and suppliers can help to cut costs and free up money to put toward business growth in other areas.
Business growth is not just about the money, although, growth and money do go hand in hand. It is about working smarter and not harder. It is also about maintaining a reputation, staying competitive, treating employees well, and being open to the evolution that is constantly happening. During phase three or the business evolution your focus should be on improvement, growth, and continuing transitions.
You Have to Always Be Tuned In
Whether you are starting out or you have reached a goal with your business, you have to stay on alert and make sure you are putting your money where it does the most good for your business. The top business investments are fluid and ever-changing and depend heavily on your business goals, what phase your business is in, and your industry.
What history has taught us is that to stay competitive, there is no time that you can ignore business investments. It has also taught us that there is no finish line when it comes to business investments. It is a constant evolution.