reduce business debt

5 tips to reduce business debt

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Nothing puts a stop faster to business growth than a company in poor financial standings. If you (or your client) need to reduce business debt, start with these top tips.

Growing businesses need to have ample access to working capital, but carrying debt is a problem that holds many companies back. According to USA Today, the average business owner carries around $195,000 in debt, which can tie up much-needed funds.

If you’re spending sleepless nights worrying about your company’s debt load (or your client’s debts), these five tips can help make a difference: 

1. Create a cash flow budget

Creating and maintaining a cash flow budget helps you understand how your business is performing, where your money is going and coming from, and how much you will need to pay for future operational expenses. Despite this vital step, as many as 61% of SMBs operate without a budget. 

To avoid becoming part of the statistic, you can create a budget with these seven main steps:

  1. Use a transaction API to gather data on the last 24 months of expenses.
  2. Calculate your income from all sources.
  3. List variable costs.
  4. Add up fixed expenses.
  5. Estimate additional spending.
  6. Analyze cash flow.
  7. Set spending goals.

Of course, the budgeting process will require time and effort, so it may be worth your while to hire an accountant or, at the very least, outsource your accounting needs to a financial professional.

Create a cash flow budget

2. Cut back on expenses

Aside from creating and adhering to a strict budget, cutting back on business expenses is one of the most effective ways to reduce business debt. Review your budget to see where you’re spending money unnecessarily and to identify costs you can potentially lower.

For example, do you need to rent an office building or can staff work remotely? How much could you save by going paperless?

Think outside of the box and get creative with where you could save money. But remember that cutting too much too fast can also have detrimental effects on your company’s overall performance.

3. Boost your revenue

Another great way to reduce your debt is to increase your revenue. Some easy ways to do this are by increasing your pricing, promoting value add-ons and upgrades, and reaping more value from your operational assets.

4. Consolidate your debt

In many cases, debt becomes burdensome because of high-interest rates. You can reduce your business debt and what you pay in interest, fees and maintenance costs, by consolidating business debt.

5. Seek alternative financing options

If you need to increase your cash flow, consider invoice factoring. This allows you access to working capital by selling your invoices to a factor like Liquid Capital. 

 

Grow your business by reducing your business debt

Business debt can eventually feel paralyzing and hold you back from growing your company. Don’t let it overwhelm you. Take these steps today to get out of debt quickly. 

If you (or your client) need access to extra working capital to help you overcome your cash flow challenges, reach out to a Liquid Capital Principal today.

 

Up next: Improve your access to timely business financing, read the “How to become lender-friendly” guide

Long-term business growth

Build meaningful relationships to fuel long-term business growth

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When you and your team consistently create meaningful relationships with clients, it can lead to long-term business growth.

Long-term business growth

With 92% of consumers worldwide stating that they trust recommendations from friends and family above all other forms of advertising, your current clients are an important lead generation source. Especially with the evolution of the relationship economy.

Here are four ways that your happy clients can contribute to your long-term business growth and success in the relationship economy:

1. Word of mouth marketing

According to a Statista report, nearly 19% of purchase decisions for financial services were impacted by word-of-mouth marketing. By having great relationships with your clients (and other business contacts), you’re more likely to benefit from word-of-mouth marketing and attract new business.

2. Brand loyalty

Brand loyalty is driven by dependability, quality and excellent client experience. If you master these, you’ll enjoy the benefits of seeing higher lifetime value, which can lead to long-term business growth.

 

The beginner’s guide to sales prospecting in the relationship economy

Get your copy of The beginner’s guide to sales prospecting in the relationship economy

 

3. Referrals and access to new networks

When you create a great impression in someone’s network, they may introduce you to new potential leads and prospects. Having strong, mutually-beneficial relationships can help accelerate rapport and shorten the sales cycle – making it faster to connect with new prospects and increase sales. 

4. Testimonials and case studies

Building strong client relationships mean they’ll be more likely to volunteer to share a positive review or testimonial. You can also follow up to interview them for a case study. These kinds of social proof can help you attract additional prospects and support business growth. 

 

“84% of people trust online reviews as much as a personal recommendation.”

— Inc.

 

Enjoy the benefits of boosting your reputation

With 84% of people trusting online reviews as much as their friends, providing a great experience at every step along your buyer’s journey can boost your reputation and attract new clients to your business. 

Remember, your current clients are your best cheerleaders, they can help generate sales and reduce the amount of time, money and effort it takes to generate new ones. 

 

Need to access additional funding on your quest to build better relationships? Consider an alternative funding solution, such as invoice factoring.

Financiamientos recientes – Febrero 2022

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Digital networking strategies

Digital networking strategies to reach new clients

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Looking to leverage digital networking strategies to fuel your prospecting efforts? Get started with these top strategies!

Digital networking strategies

Prospecting in the digital world is all about delivering value, building rapport and increasing visibility so you can start conversations on a mass scale. But if you’re busy running your business, it can be daunting to know where to start.

Here are some digital networking strategies to connect with prospects in the relationship economy:

Digital Networking Strategy #1: Use social media to expand your network

LinkedIn is often described as THE professional social media network. It’s a great place to do research and leverage your network for connections. Using LinkedIn’s Sales Navigator and search engine, you can search for prospects who meet your ideal client criteria. 

LinkedIn groups are also a great place to spark conversations and build rapport with potential prospects. For example, if someone makes a post related to your business, your rep can chime in with a helpful answer and follow up personally with relevant resources.

Like LinkedIn, Facebook has a variety of ways to reach potential prospects. Have your team join active groups that discuss topics that relate to your products and services. From there, they can contribute to the conversation and follow up directly with potential prospects. 

Note that your team will need to adhere to the group rules to ensure they’re not removed. Many groups object to direct promotion of products and services.

Remember, before your team starts using LinkedIn, Facebook or any other social media platform, make sure their profiles are clean, clear and consistent across your company for added credibility.

Networking with webinars

Digital Networking Strategy #2: Host and attend webinars

Hosting informational webinars can attract and engage potential prospects. Although they take preparation and expertise to run effectively, they can be an excellent tool for engaging prospects and showcasing your solution.

The webinar should be valuable and relevant for the prospect by providing educational info on a common challenge or question. Presentation formats that can help convert prospects into leads include product demos, content marketing or training on a specific topic. 

Webinars also provide valuable data about the prospects who attend, such as how engaged or attentive they were during the training. This can help your sales reps prioritize who to follow up with and continue to nurture the prospect.

Digital Networking Strategy #3: Leverage email marketing tactics

If you thought that email marketing was no longer relevant, think again! With marketing emails generating $42 for every $1 spent and providing an ROI of 4,200%, it’s still one of the most cost-effective tactics that you can use.

Using a CRM that supports email marketing will allow you to personalize and track your communications — and some can even allow you to build automated workflows that will send out the right message, to the right person, at the right time. This can free up precious time for business owners who have a small team (or are running the business solo).  

Are traditional prospecting strategies still relevant?

While modern prospecting offers new opportunities to connect with others, traditional prospecting still has its place in your sales process. And when you combine digital networking with traditional sales prospecting strategies, it gives you and your team even more chances to network, prospect and build long-term relationships.

 

Up next: Learn how to combine digital and traditional prospecting strategies and help you grow your business.

connect with prospects

Connect with prospects in the digital 2.0 world

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In the relationship economy, successful business owners and sales teams connect with prospects in new ways. Are you?

connect with prospects

Thanks to digital media, there are many ways to engage with potential prospects in the digital world. Here are three of the top ways to leverage digital marketing to connect with prospects in the relationship economy.

1. Social media

This is a gold mine for finding people already talking about products, services or topics related to your business. Join the conversation that’s already happening and be a helpful and valuable presence. From there, sales reps can build relationships and follow up with potential prospects

2. Content marketing

Whether it’s writing a blog or hosting an informational event, there are plenty of ways to get in front of warm audiences who may be interested in your business. Content marketing examples include creating white papers, informational webinars, eBooks, newsletters and other types of written, video-based or graphical resources. Sales reps can track who engages with this content and follow up.

3. Email marketing

Even in a crowded world, email marketing can keep your business top of mind. Reaching out via email is a great way to deliver valuable information, build relationships and stay connected to prospects. Your sales reps can make one-to-one contact or make use of automation, segmented lists and Sales nurture drip sequences to deliver valuable ongoing content. This email marketing strategy can create brand touchpoints within your prospects’ inboxes on a regular basis.

Can your cash flow support new tactics?

If you or your client are looking for new ways to turn prospects into customers, using digital tactics can help you to connect with a large number of prospects in an efficient amount of time. And thanks to the valuable data they provide, digital tactics are useful for improving prospecting strategies and streamlining your team’s efforts.

However, implementing new tactics and launching strategic campaigns can also mean a need for increased cash flow. Leveraging the power of alternative business funding can give you a much-needed cash flow injection without adding debt to your book of business.

 

Want to learn more about how invoice factoring and alternative funding solutions from Liquid Capital can help? Contact one of our Principals today.