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The business world is highly competitive, and in order to succeed in this cutthroat environment, you need to have a game plan. To avoid following the same strategies as your competition, it’s important to develop your own unique approach for growing your company.
There are dozens of financial strategies you can implement to rise above your competition, such as improving profit margins by raising your prices, finding cheaper suppliers, and reducing your overheads. While these strategies are essential, however, they’re not enough to give you a competitive edge. To truly stand out, you need to develop a unique approach for running your business that sets you apart from the rest.
Not sure where to begin? Here are a few ideas to get the ball rolling:
Separate working capital from growth capital
If you are looking to grow your business, it’s important to understand the difference between working capital and growth capital.
Working capital refers to the short-term funds your business needs to operate, such as money for salaries, supplies, and other day-to-day expenses.
Growth capital refers to the long-term funds your business needs to expand, such as money for new equipment, licenses, and marketing campaigns.
Separate these forms of capital into two different buckets so you can make the right investments at the right time. For example, if your business is growing quickly, you should consider investing more money in your growth capital so you can expand and increase your output. If your business is operating on a tight budget, you should focus on working capital so you can keep the lights on, make payroll, and continue providing the best possible service to your customers.
By separating your working and growth capital, you force yourself to prioritize certain areas of your business. This way, you can feel more confident that you won’t be short of cash when you need it, and you can avoid wasting money on unnecessary expenses.
Build and maintain a cash reserve
One of the best financial strategies you can implement to stay ahead of the competition is building and maintaining a cash reserve. A cash reserve is a pool of money your business keeps on hand for emergencies and unexpected expenses.
If your business experiences a sudden drop in sales, a cash reserve will help you cover the overhead until things return to normal. Similarly, a cash reserve will help you weather unexpected expenses, such as large delivery fees or equipment repair. Keeping a cash reserve on hand is one of the most effective ways to protect yourself from financial disasters (keep in mind, the size of your cash reserve will vary depending on the size of your business and the industry in which you operate).
Identify gaps in your competition’s marketing plan
Your marketing plan plays a crucial role in your ability to rise above the competition. To effectively strategize, you need to know what your competition is doing and where they are lacking, so you can take advantage by succeeding where they are weak.
Conducting a competitor analysis is one of the best ways to identify the gaps in your competition’s marketing plan and take advantage of their mistakes.
Even if your competition has a larger marketing budget than your company, you can use your competitor analysis to pinpoint weak spots and develop a cost-effective plan to outshine them. For example, if your competition focuses all their marketing efforts on social media, you can develop a strategy to target customers who may not be as active on social platforms by reaching them via email .
Only invest in initiatives that deliver genuine value to your audience
One of the best ways to rise above the competition is by only investing in initiatives that deliver genuine value to your audience.
While it might be tempting to invest in multiple channels at once to capture as many customers as possible, the best way to grow your business is by focusing on the initiatives that are proven to provide the most value to your audience.
For example, if your marketing initiative is only generating small, incremental gains, it’s often better to shift your resources to a different area of your business that can drive a much larger return.
Similarly, if you find an initiative is generating a lot of hype but isn’t actually moving the needle, you might need to evaluate whether it’s truly worth your time and resources.
By focusing on the initiatives that are proven to provide the most value, you’ll be able to maximize your efforts and get the biggest return on investment.
Rise to the top with BBB Accreditation
Whether you’re just getting started with your company or you’re an established business looking to grow, BBB Accreditation provides a level of credibility that will help you rise above the competition.
BBB Accreditation is the mark of a business that is committed to providing exceptional service to its customers. Accredited Businesses meet high standards of ethical business practices and transparent business policies, and they are committed to continuous improvement.
Most importantly, BBB Accreditation allows customers to identify the businesses that have been vetted by their peers and will provide them with the best possible experience.
Start building brand trust and loyalty today. Learn more about BBB Accreditation and how it can help your business.
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See more business tips at BBB.org/BizHQ.