business plan

Developing a business plan for your new venture

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Do you have an idea to evolve your business or maybe even starting something brand new? Turning your vision into a reality requires developing a business plan. Here’s how to get started.

developing a business plan
Image via Unsplash

Many people are waiting for all the stars to align before taking the next leap in their business or starting an entirely  new company. Because of that hesitation, they never get around to fulfilling their dreams. But by getting rolling on developing your business plan, you can turn your dream into a reality faster. 

In 2022, industries will continue to shift in new ways, and now may be the perfect time to take your project to the next level. To get started, it’s important to know what is involved in venturing into new territory or starting a business, and that’s where a business plan comes in. 

Why is developing a business plan so important?

A business plan is a formal document that provides the roadmap for your company. It can help you navigate through tough decisions and can help you manage any challenges that may come your way. It will also help you stay focused on your end goal as you grow your business. And if you are starting a completely new venture, it’s essential to have one in place before applying for funding or securing partners. 

To create a great business plan — whether for your startup, scaling business or mature enterprise — you’ll want to start with these steps:

Step One: Define your business goals

The first step in creating your business plan is determining the direction of your business (if you’re evolving into new territory) or what kind of company you want to start — along with your overall goals. For example, will you run a physical store, or do you prefer an online business? Do you want to sell a specific product or focus on services? Maybe you already have a hobby that you want to turn into a business, or you have an idea of an innovation you can bring to the market?

Once you define your ultimate goals, you’ll be able to start thinking about how you want to achieve those goals.

Step Two: Evaluate your business skills and knowledge

Many new business owners find it helpful to take classes in business to better grasp the intricacies of running a business. Online universities offer convenient solutions for those seeking to learn more about leadership, strategy, operations and general management.

If there are some areas of running a business that you aren’t well-versed in, you’ll want to leverage outside help or software that fills in the gaps. For example, if you’ve never managed payroll, software or apps can help. Many of these services provide same-day direct deposit, automation for payroll and payroll taxes, and time tracking.

Tired of waiting 90 days for payment? Try this instead.

Step Three: Define the structure of your business

Next, you’ll want to clearly define the best business structure for your venture. Incorporating rather than operating as a sole proprietorship does have its benefits. For example, if you form an LLC, you could be eligible for certain tax incentives, tax credits and business incentives. 

You will need a clear idea of what products you will sell at the time of the company launch and how your offering will evolve with time to keep up with industry trends and client demands. You will also need to know if you will be selling directly to consumers, acting as a wholesaler, or offering a B2B service for other businesses.

Step Four: Get your financials in order

An important part of creating a business plan is planning out the financing aspect. What cost structure will allow you to create your product or service and have it reach your final consumer? This would include all the physical production costs, supply chain, marketing, and personnel costs for your company structure.

Once you have all of the above information, you can bring it all together. Make financial projections of what your sales and profits would look like over the first few years and what startup costs and cash flow you need to finance to start the business.

Access to funding will be crucial in getting your venture up and running. Invoice factoring can help build working capital. 

Step Five: Research the market

The final step in creating a business plan is to research the competition. This will help you to avoid starting an unnecessary or unprofitable venture. Think of ways that make your company unique from other similar companies who are also competing for clients in this space. Answering the following questions will help guide your research:

  • What is different about your products and services that only you can provide?
  • Based on your product, costs, customer target, and competition, what would be the optimal price points for each of your products or services? 
  • How are you going to reach your consumers and let them know about your products? 

There are many resources online today that can help you establish a solid business plan. And once you have it on paper, you will see that it makes your vision come to life and gives you a base document that you can work with to approach investors or potential stakeholders in your business.

 

Up next: Create a smart digital marketing plan on a budget

relationship building

Turn your sales team into relationship-building rockstars!

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Give your sales team a winning advantage by boosting their relationship-building skills in the Relationship Economy.

relationship building

 

Not long ago, things like price, convenience and savings would drive customer preferences. But as we’ve moved towards the Relationship Economy, consumers are increasingly prioritizing customer service, brand loyalty and personalization.

 

“In a Relationship Economy, the primary currency is made up of the connections and trust among customers, employees, and vendors who create significantly more value in what we sell. These relationships and connections help make price irrelevant.”

— John R. DiJulius III, The Relationship Economy: Building Stronger Customer Connections in the Digital Age

 

Understanding the relationship economy

In today’s world, consumers are inundated with choices. In the relationship economy, consumers narrow their options by considering which business cares about them as a customer—and which businesses will deliver the best experience. Customers may also choose to do business with companies and brands that most closely align with their personal values, as they are increasingly prioritizing customer service, brand loyalty and personalization.

 

86% of customers believe that their experience is just as important as the actual product or service they purchase. — PWC

 

As a result, the relationship economy is the idea that today’s consumer prioritizes personalization, rapport, brand loyalty and customer experience over factors such as price, discounts or savings.

And thanks to things like increased connectivity through social media and improved customer data, the shift from the consumer economy to the relationship economy has only accelerated. Companies that have a system to tailor and personalize their customer experiences are more likely to win customers and retain their business. 

customer service and relationship-building

This also means that sales prospecting needs to consider things like rapport, loyalty and relationships to build trust and credibility with their customers. Sales reps need to know how to prospect with these values in mind so they can build relationships and rapport with potential clients. 

Beyond happy customers, positive customer relationships can create ripple effect benefits, including improved cash flow, business growth, and overall brand trust and credibility.

Up next: Read The beginner’s guide to sales prospecting in the relationship economy eBook

return to the workplace

5 ways beyond pay to support employees as they return to the workplace

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Encourage even the most reluctant employees to return to the workplace with these non-monetary compensation ideas.

return to the workplace

Whether people are fully or partially returning to the workplace, company leaders and people managers are challenged to create a safe workplace that supports employees’ job performance and personal wellbeing. 

Employees who have become accustomed to remote work may find the transition back to the physical office especially difficult. Using these top tips can help leaders motivate and encourage even the most hesitant employees to embrace their return.

1. Provide a flexible workplace

If there’s one thing the pandemic taught us, it’s that there’s more to life than work. Now, employees are looking for more than just money from their employers: nearly everyone wants flexibility. 

Globally, the EY survey found that nine in 10 employees want flexibility in where and when they work. Nearly half (40%) would consider leaving their job post-pandemic if their employer did not afford some form of flexibility in where they worked. Considering a hybrid work model doesn’t require additional compensation and checks the box on “where” people work.

2. Abolish the 9 to 5

During lockdowns, many people re-evaluated their lives and defined new priorities, whether it was pursuing a long-forgotten passion or vowing never to miss another family dinner. 

A flexible work schedule allow employees to work outside the conventional nine-to-five Monday to Friday workweek and create their own schedule to suit their needs. As long as productivity remains high and the output of work is consistently strong, this could be an attractive benefit for many employees. 

3. Offer additional support to employees

If you’re looking to create a truly flexible work environment, consider providing benefits that support your employees, such as day care subsidies, transportation bursaries, cost of living bonuses and or shortened workweeks as some companies have done. These benefits will improve the culture across the entire organization, improving employee satisfaction and productivity to ultimately make your employees happier, more productive units of value within the company. Increased worker satisfaction will also lead to better customer experiences.

4. Reevaluate your sick leave policy

In pre-pandemic times, going into the office coughing and sneezing, box of tissues in hand, was a sign of bravery and loyalty. Now, the message is: if you’re sick, stay home. That gets complicated for hybrid and remote workers. Someone who is sick might still be able to do some work from home, while others might have to work from home while tending to a sick child, raising questions about what constitutes a sick day or leave.

Consider reevaluating your sick day and paid leave policies to account for the new work environment and your employees’ work/life circumstances.

5. Modernize your health benefits plan

In addition, look at your benefits plan to see if more support can be added in light of people’s current struggles. For example, many organizations have introduced or increased coverage for mental health services, physical activities (such as gym memberships or yoga classes) and feminine healthcare. Another important thing to ensure is the physical safety of your workers/employees in the workplace. If any employee gets injured while working, the employer should be responsible and considerate enough to provide adequate support to the employee by compensating and giving him the required time off to attend all the medical appointments, receive treatment and recover.

Putting People First

Ultimately, people are at the core of every successful business, and providing a supportive workplace makes all the difference. 

At Liquid Capital, we’re dedicated to helping our clients with their financial needs, but we also care about their people. We’re business owners, too, so we understand the importance of employee happiness and wellbeing.

Want to increase your own mental health resilience? Discover these Positive mental health practices for entrepreneurs.

Can’t get a bank loan

How to grow a business when you can’t get a bank loan

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Can’t get a bank loan? You’re not alone, and you have more options when trying to fund your business growth.

Can’t get a bank loan

Photo by Jopwell

Startup capital is the number one obstacle to starting a business and then growing it to new heights. Getting a bank loan is difficult without a proven business history that shows your creditworthiness—and draining your savings to start a business is a risky move.

If you can’t get a bank loan, there’s no reason to abandon your entrepreneurial dreams. Here are three strategies you can use to start a business and grow it with limited working capital.

Start a low-cost business

Some businesses require five figures to launch, but there are a lot of businesses you can start without a major investment.

  • Online businesses are among the cheapest to start. Examples include selling virtual services, creating digital products or starting a no-inventory eCommerce business using dropshipping and print-on-demand services.
  • If you prefer to keep it close to home, look to local services businesses like pet care, lawn care or cleaning services. Think about how you might scale those into bigger operations, and you could take a traditional small job and turn it into a bigger business operation! 
  • Freelancing businesses are another top choice for first-time entrepreneurs. You can start a freelance business on the side or full-time using online marketplaces to build your client roster.

Your choice of business entity affects the costs of starting a business. Corporations come with additional startup costs but could be the right choice for your structure. While sole proprietorships and LLCs are inexpensive to form, they also come with limitations, so it’s important to consider the pros, cons and get professional advice on the route to follow.

Find business investors

What if you have lofty business dreams but lack the capital to make them a reality? When you have a great idea but no money to get it off the ground, turn to investors.

  • Angel investors and venture capitalists are two major sources of equity funding for startups. This type of investor is often suited for high-growth startups with the potential for large returns.
  • Startup accelerators help new business owners connect with investors. Some business accelerators provide capital directly to startups, sometimes in exchange for equity.
  • Many small startups find success with crowdfunding. The best crowdfunding strategies offer equity or non-financial rewards in exchange for contributions.

Apply for alternative financing

Business loans aren’t the only way to finance your venture. These financing alternatives appeal to entrepreneurs who can’t get traditional business loans or bank funding. 

In many cases, alternative financing can be leveraged alongside your traditional funding, and at Liquid Capital, we’re happy to work with your banker, traditional lender and other financial institution. Essentially, we become your funding team, which can supercharge your financing abilities.

  • Peer-to-peer lending uses unsecured personal loans through P2P lending platforms to provide startup business capital. Because P2P lending isn’t FDIC-insured, it’s important to understand the risks.
  • Equipment financing helps founders buy equipment without the barriers of traditional bank financing. Because the business equipment serves as collateral, you may not need credit history to qualify.
  • Early-stage businesses can maximize growth using invoice factoring. Invoice factoring turns unpaid invoices into cash to free up working capital.
  • When all else fails, bootstrapping is a proven way to build a business from the ground up. Instead of relying on outside funding, bootstrapping grows a startup slowly using its own funds.

Of course, we don’t want you to struggle to get funding, so give us a call and we can walk through all the options with you.

Scaling a business?

You don’t have to choose between draining your savings and giving up on your business goals. With the right strategy, you can start a business without putting your personal finances on the line. Use these resources to learn more about your startup financing options and discover your business’s path to success.

Up next:

 

returning to the office

Returning to the office won’t be easy. How can leaders support employees?

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As employees begin returning to the office, there are some key considerations that leaders will want to address so their employees are supported.

returning to the office

Going back to the office and back to “normal” is a hot topic around the virtual water cooler these days. But as company leaders finalize their re-entry plans after more than 18 months of remote work, they face a cold new reality: The workplace as we knew it is no more. 

Even though socially distanced employees miss engaging with co-workers in person, many are reluctant to return full time. Research from Leger found that 33% of Americans and 40% of Canadians want to work a hybrid model, meaning a mix of in-office and at-home work. In addition, about half of Americans (47%) and Canadians (50%) who want to return to their workplace wouldn’t be comfortable doing so if some of their colleagues aren’t vaccinated. 

To help ensure successful re-entry, here are several ways to support your employees and teams when getting back to the office: 

Physical health and safety is job number one

Even as public health measures surrounding the pandemic lift, you can take steps to reduce health risks (and any associated fear factor) in your workplace. Guidelines to help stop the spread of the virus include implementing a rapid testing and screening program, providing personal protective equipment, and working with a building operator or HVAC specialist to improve air exchange rates or filtration. In the McKinsey study, improved air filtration was a top request among employees, with 62% saying it could decrease the stress they experienced from returning to work.

Put yourself in employees’ shoes

Just as employees had to acclimate to a new way of working when the pandemic first hit, the return to office comes with its own set of adjustments and challenges. For example, in a recent McKinsey survey, one-third of respondents said the return to work has had a negative impact on their mental health. Among those who have not yet returned to their workplace, nearly half anticipate negative mental health impacts such as stress and anxiety.

Create policies

A vaccine policy might also help ease employees’ minds. A survey by EY found that 61% of employees want their company to require the vaccine before returning to physical workspaces. For employees’ part, encourage them to stay home when they’re sick, practice hand hygiene, clean and disinfect their workstations, and maintain physical distance from co-workers.

Create an environment of psychological safety

In addition to making sure your employees are physically safe, it’s important to prioritize psychological safety. Psychological safety refers to the feeling of being one’s whole self at work, and the belief that one can speak up with ideas, questions or concerns without fear of negative consequences. 

A Workhuman survey of U.S. workers found that only 26% felt psychologically safe during the pandemic and experienced higher levels of burnout, stress and loneliness. 

Some ways you can boost employees’ psychological safety are showing appreciation for their ideas, being an active listener, fostering a culture of openness, and creating a sense of belonging.

Consider pay transparency

Most employers don’t want their employees to compare paycheques, as it can result in animosity and resentment among their teams. However, the concept of pay transparency is gaining momentum, as it aims to close unfair pay gaps based on gender, race, age or disability. While this might not be for everyone, it could be something to consider for some organizations.

Pay transparency allows your company’s compensation figures (salary ranges or specific numbers) to be visible to other people, either internally, publicly, or both. 

While pay transparency encourages equal pay, there’s more to it than monetary benefits. When done correctly, pay transparency can improve workplace culture, promote diversity, boost morale and improve employee engagement. Some pay transparency tips are: 

  1. Review compensation models and resolve salary discrepancies
  2. Determine your company’s comfort level with pay transparency
  3. Train managers on how to successfully navigate salary discussions.

 

Once you’ve reviewed these considerations, you will want to create a clear and transparent return to the office plan. Sharing your plans with employees will help to reduce anxiety and uncertainty about what awaits everyone as they transition into the post-pandemic workplace — whether they return in-person full time or take a hybrid approach.

Up next: 7 ways to make strong business relationships that last

business cash advance vs. invoice factoring

Tired of business cash advances and waiting 90 days for payment?

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Thinking of getting another business cash advance? Learn why invoice factoring might be better for you or your client.

business cash advance vs. invoice factoring

Cash flow is vital for your business and impacts everything from payroll and lease payments to your next capital investment. But when it’s all tied up with your clients and their unpaid invoices, what can you do? 

Many business owners turn to their bank for help, but can’t always get financing. Others may resort to merchant cash advances, but those temporary solutions could leave you in a worse position than when you started.

And what if your business is new and you don’t have the past business or credit history to even apply for the advance? You’re still stuck with outstanding invoices and no cash flow.

 

Related: Learn why you should choose invoice factoring over a cash advance

Unlock cash today with invoice factoring

Why not leverage your current client open invoices to get you access to cash through invoice factoring instead? After all, you’ve worked hard to earn that business, but unless the client is going to pay you early, you can only access it today through invoice factoring. 

Invoice factoring can immediately unlock money that’s already yours, freeing your business from the regular net 30, 60 or 90-day payment cycle. You can use the money for payroll, operational costs, debt repayment, supplier invoices or anything else you want to pay off. 

Your factoring partner keeps a small percentage of the invoice as a reserve, while you see the majority of that working capital right away.

cash advance

Image via Lucas

If you’re in need of ongoing cash flow and want to eliminate the hassle of unpaid invoices, please get in touch. We can explain how invoice factoring works and uncover financing for your business that will unlock the money your business is already owed. 

Free up your business cash flow today and breathe a little easier. 

Get started with a helpful, no-obligation consultation. Find your nearest Liquid Capital Principal today.

Business growth recovery concept

Making cash available for your business recovery

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Part 3 of the “Cash Flow Through Uncertainty Series”: Implement these tips to build your business recovery strategy.

Business recovery and growth concept

When an economic crisis (or global pandemic) comes to an end, it’s time to start thinking about moving from survival mode to thriving mode. But having the cash to get back into growth and prosperity can be tricky after months or even years of crisis income. 

Using these tips and resources can help you to recover better, faster and stronger:

1. Know your working capital

Basic math can give you an idea of how much cash you have to work with. Subtract your liabilities from your assets as a starting point. To get more detailed, set a cash flow budget. Some businesses will be starting almost from scratch, so you need to create a realistic budget of how much you’ll need to get back up and running at full speed.

2. Make realistic budget forecasts

Revenue may not immediately reach pre-crisis levels. So plan for lower-income levels in the meantime (ie. at least for the next six months) until you can more accurately gauge demand. Similarly, you may have to increase spending to reach the inventory and staffing levels you’ll need for a successful recovery.

3. Take a look at the ‘damage’

Assess exactly where you are financially now that you’re on the other side of the crisis. Work out how badly you’ve been hit, including your assets, investments, savings and regular income. Compare those with last year’s figures and build an accurate picture of where you’re at, where you want to be, and what financing and income you need to get there.

cash flow budget

4. Create a realistic schedule for recovery

When things start getting back to normal, you’ll be understandably impatient to return to pre-crisis levels of business. Creating a step-by-step schedule for achieving this is crucial for successful cash flow management. For example, you might first secure the financing you need for recovery, then build up your inventory and finally hire new employees (or bring back old ones).

5. Find a supportive and understanding finance partner

You may need flexible finance options to make a full recovery—and you want a lender whose employees have the right mix of expertise and understanding of the needs of small and medium businesses. Many larger financial institutions are risk-averse and don’t offer flexible options. On the other hand, alternative lenders can offer a variety of financing solutions, plus the expert advice to help your company launch into recovery.

Help for every uncertain stage

Liquid Capital is committed to helping small and medium-sized businesses to weather uncertain times and periods of crisis. Our team of experts are experienced in strategic funding strategies and will be with you every step of the way as you go through turbulent times.

Along with that expertise, we provide the finance options that can offer working capital when you need it, including invoice factoring, asset-based lending and more. Get in touch to find out more about our cash flow solutions and how we can help your business.

 

Up Next: Read Part 1: How to manage cash flow through uncertainty and Part 2: Sail through a cash flow crisis — 5 places to batten down the hatches

4 tips to turn customers into advocates

4 tips to turn customers into advocates

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Part 3 of the “Business Relationships Series”: Why entrepreneurs should focus on ways to turn customers into advocates.

4 tips to turn customers into advocates

It’s no longer enough to connect with a prospect just at the time they’re ready to make a purchase. Modern customers are now trained to do their research before making a purchase. And technology has made it easy for them to discover your happy customers (or not), and those customer reviews will play a large role in persuading prospects to buy from you.  

One recent survey found that 90% of consumers said that positive reviews influenced their buying decision. Another survey discovered that 86% of customers are willing to pay more for a great customer experience while, conversely, 32% of customers will turn their back on a company they love, after just one bad experience.

Turning customers into advocates

After turning a prospect into a customer, and creating a good business relationship, the next step is to strengthen that relationship and turn your customers into advocates of your brand.

Brand advocates are passionate champions of their favourite organizations—and will tell others about their amazing experience with your company. In fact, according to a recent study, advocates are two to three times more effective at attracting new customers to your brand.

Ready to build an army of brand advocates? These strategies will help you and your clients get even more out of your relationship:

1. Never take customers for granted

Ensure that your product or service never slips from the excellent levels your customers have come to expect—and be diligent in maintaining an outstanding customer experience. Maintain consistent communication, spend time with your customers and learn as much about them as possible.

This might be over the long-term or even just in a quick phone call. Use that knowledge to be selflessly helpful by providing ongoing, valuable advice and ensuring that your relationship is mutually beneficial.

2. Under-promise and over-deliver

Always strive to deliver exactly what was promised, on time, and then some. You can also provide added value to your customers in ways that have little monetary cost to you but considerable value to them.

For example, do a quick follow-up to continue nurturing the customer relationship after they make their purchase. Something as simple as a check-in email to see how they’re enjoying your product or providing them with a helpful piece of content after their purchase can go a long way in leaving a lasting impression. You can also wish them a happy birthday if you have that information, or even reach out to B2B clients and congratulate them on a new product launch or business achievement.

3. Be there for them in tough times

When clients are going through a difficult period, do what you can to help them get through it. For example, you may choose to accept late payments or defer late-payment charges for those who are experiencing a rough patch. You could even suggest a payment plan for clients who are having cash flow issues.

Depending on your relationship with your client, you may also consider referring them to contacts who might be able to help them out, such as with alternative financing options or inventory liquidation.

4. Create a customer advocacy team

Dedicate a team, or internal staff, to managing a customer advocacy program. Having a specific person or group responsible for nurturing customers into advocates will formalize the process and ensure that it’s a key strategy in your customer growth plan.

In addition, consider establishing a loyalty or referral program, which can encourage customers to become advocates. Then, task your customer advocacy team with managing its growth, and the positive spin-offs will naturally evolve throughout your entire organization.

 

If you’re looking to grow and expand your business into the future, making strong business relationships is the cornerstone to success. Here at Liquid Capital, we’re business owners, too, so we understand what our clients go through. While we’re dedicated to helping out clients with their financing needs, we also get to know them as people so we can understand their business challenges and opportunities—and then work out a plan to be the most useful partners for them.

Ready to learn more about our versatile, unique range of financing solutions, such as invoice factoring, that suit many sizes and types of businesses? Contact your local Principal today.

Effective communication skills

How leaders can navigate these market recovery trends

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Liquid Capital’s Fall Roundup: As the economy begins to stabilize, how can you successfully navigate the market recovery?

market recovery trends

This year, there has been a substantial shift in the ways that customers and employees engage with companies. For many entrepreneurs and business owners, much time will be spent navigating current market recovery trends.

From finding enough time and mental stamina every day, to make impactful decisions and changes for your business, to motivating yourself and those who work for you — only the strongest will successfully emerge from the upcoming COVID-recovery period.

Manage your time more effectively as you navigate the COVID-recovery period

time management market recovery trends

Recovering from the ripple effects that the pandemic had on businesses will take serious time and energy — something that most entrepreneurs were running short on before COVID struck. Leaders who want to ensure that they’re able to take their companies into the next year (and years to follow) must be able to allocate the right amount of time to the right tasks. The company, its employees and its customers depend on it. These five tips can help you get started mastering the skill of time management.

Read more

 

Keep employees motivated if they’re still working from home

Keep employees motivated

After almost two years of remote work, workers are struggling with mental health, productivity and overall success now more than ever. And while many employees are making the transition back to the office, many more are continuing to work from home. Is your office space still in transition to fully on-site or are you and your employees continuing to work from home? And what can one author’s experience being homeschooled teach us about shifting how we work remotely? Find out below!

Read More

 

Better mental health leads to better decision-making during times of uncertainty

Better mental health

Our brains were not made to constantly shift in response to the new demands of a quickly changing world. And since the pandemic hit, many leaders have been pivoting on a dime and being agile in order to stay competitive. Accepting that our brains were physically not designed for this kind of stress is the first step to becoming stronger. The next step is embracing the following top strategies.

Read more

 

 

Effective communication skills: The leadership key to 2022

Effective communication skills

From active listening to asking effective questions to getting comfortable being uncomfortable, if you want to lead a team with ease your communication skills must be on point. Here are nine of the best ways that you can start improving the quality of your communication and, in turn, lead your team better.

Read more

 

Up next: Build stronger, longer-lasting relationships.

strong business relationships

4 tips for maintaining strong business relationships

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Part 2 of the “Business Relationships Series”: The importance of maintaining strong business relationships with your contacts and clients.

strong business relationships

The way businesses attract customers has shifted forever. The old methods of marketing to catch a customer’s attention, getting them interested and having them make a purchase doesn’t happen in the same way anymore.

In Part 1 of the “Business Relationships Series” we looked at some key tips for turning prospects into customers. In this part 2 of our series, we’ll look at what to do now that you’ve landed a new customer—and ways to help you keep them as a customer.

Strong business relationships are like a good friend

Imagine for a moment this scenario in your personal life… 

You’ve made a new friend and have a great connection—but then as soon as you hang out, maybe going for a round of golf or dinner at the newest restaurant in town, you stop calling and seeing them. Chances are, they probably wouldn’t be willing to help you when you call needing a ride to the airport or an extra hand when you move.

It’s a similar situation in business. One of the biggest mistakes a company can make is to neglect their current customer base. Doing so inevitably results in high churn and loss of customers—which can have a serious impact on your cash flow. Not only is it more expensive to bring in new clients to replace those you’ve lost, but you’re also missing an important opportunity to increase your sales. 

You need to keep working to make sure your current customers (and referral sources, suppliers and other business contacts) are happy in your relationship. If you have a high churn rate, then it may be time to look at ways to strengthen your customer and contact base.

Here are four tips to get you started:

1. Offer an excellent product or service, with a best-in-class customer experience

Having a great offering is clearly a big advantage for both securing and keeping customers. However, the way you treat your customers is just as important as what you deliver to them. Ensuring that everyone in your company buys into the notion of providing an outstanding customer experience, and delivering the training and support to ensure they succeed, will set you apart from most of your competitors.  

Not only will this strategy ensure that your customers stick with you, but it will also turn them into your biggest fans who will deliver quality referrals and help you to grow your business.

2. Put your customers first

Having a customer-first business strategy can really pay off and set you apart from your competitors. Listen to your customers, take their feedback into consideration and keep your brand promises. This could mean that you may need to invest extra working capital into your business, which can be a daunting thought if you’re already struggling to stay cash flow positive.

If you do find yourself in need of additional capital, consider leveraging an alternative funding solution, such as invoice factoring. Remember, investing in your customers may come with short-term costs, but the goodwill, trust and gratitude you will earn will bring dividends in the long term.

3. Be honest and authentic

Nothing will kill off a business relationship faster than little white lies or coming across as untrustworthy. Clients will smell it from a mile away and run for the hills. If there is a problem, own up to it, explain how it happened and, most importantly, describe in detail how you will put it right.

4. Help your customers become successful

Be a partner, not just a supplier. Use your experience and expertise to provide advice that will support them in growing their business. Help them to overcome problems, suggest new potential markets or introduce them to a valuable supplier or potential customer.

 

Just as with any personal relationship, most people want to work with others who provide genuine support and a mutually beneficial experience. Companies can nurture and strengthen their current customer base by providing valuable advice, ideas, contacts and encouragement. By being a trusted partner and resource, your customers will stick with you—and bring you referrals.

At Liquid Capital, we understand the importance of relationships and work to help provide you with the working capital you need so you can focus on your customers. Want to learn more about how we can help you and your clients? Contact us today.