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How to Increase Your Bank Balance in 2021

Now is the time for New Year’s resolutions, be it ‘stop drinking my body weight in wine every weekend’, or ‘leave the chocolate bar in the cupboard’, a resolution is only a dream without a plan. And a plan without action is a waste of time.

If your New Year’s resolution is to put more money in the business (and therefore your) bank account, this one is for you, and is the process we go through with our clients (but you actually have to action it).

1.    Review costs:

This is so simple but there are so many business owners out there spending thousands on things they don’t use or need. £100 here and there isn’t a lot on its own, but when added to other £100s here and there, it can add up. When I last did this, I saved about £500 per month just by stripping out things we didn’t need, and we don’t even have that many outgoings. I saved another £6m business I worked for in corporate £500k per year by restructuring some costs during this process.

2.    Review people:

Have you got the right people for the jobs they’re doing? People will say I’m heartless for suggesting this, but business is business: The pool of amazing people that are either unemployed or unhappy in their jobs but unable to leave through fear of not getting another one is huge at the minute. If people are great for the company, but in the wrong job, can you move them? If people are not great for the company or their current roles, now is the time to make some solid decisions and not put yourself and the business on the back foot due to other people’s feelings, it’s that simple. If you’ve been procrastinating about actioning those decisions, now is the time to get on with it. Unfortunately, we’ve all had to do it at some point in our lives, but it always works out for the best. Ultimately, your staff will enable your growth, or they will stifle it. Don’t let it be the latter.

3.    Review systems and processes:

The wrong systems and processes can cost thousands in both time and money. Are there any repetitive or low value and low skill tasks that can be automated or outsourced? Do your systems talk to each other the way they should? Are you using the functionality in the most efficient and effective way possible?

Be stringent with your time; it’s valuable, and by becoming more aware of how much of it you’re wasting and ensuring less of it is wasted, you will have more of it to do things that will put more money in the bank, such as getting new clients or exploring new, more profitable revenue streams.

4.    Review the advice you’re being given:

They say “buy cheap, pay twice”. The same goes for getting advice and paying for services. How many times have you paid, for example, a marketing person £250 a month and you may as well have essentially just thrown it down the drain? If something sounds too good to be true, it generally is. Look at the services and advice you’re paying for on a regular basis and take an objective view. Are you getting any real value from it? If not, bin it or swap it for something better. We charge in the region of £1k – £2k per month, but we will save that and more in many other ways, such as tax, time, cost-cutting exercises and more.

5.    Review revenue streams:

“Just sell more” is never a good strategy if you’re not making enough profit. We get there might be necessary loss leaders in the business, but it’s always worth reviewing your revenue streams and working out the direct costs associated with each of them. It normally throws out some skeletons that need to be addressed! All that happens when you ‘sell more’ is the numbers get bigger, your profitability (and therefore cashflow) doesn’t.

If you’ve got a 6 or 7 figure turnover business and you want to put more money in the bank in 2021, but you’re not sure where to start, give us a call on 01908 429294.

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www.cornerstonefd.co.uk | 01908 429294 | anniet@cornerstonefd.co.uk

The financial cornerstone of six and seven figure businesses.

 

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