While the phrase “New Year’s Resolution” may bring to mind unused gym memberships and failed attempts to learn French, many small business entrepreneurs could stand to benefit from setting a few resolutions of their own.
I work closely with some of the most innovative small business owners in the United States, and I’ve noticed that even the most clever, creative, and motivated entrepreneurs tend to struggle with a few issues. So, I’ve crafted my top five New Year’s resolutions for small business owners moving into 2020.
#1: Manage your cash flow
In 2020, I hope that entrepreneurs in every industry can spend more time on growth, products, and employees, instead of sorting through bills and unpaid reimbursements. Recognize that cash flow is the lifeblood of your business. I’ve seen many brilliant entrepreneurs fail because they were unable to manage their cash wisely. My top tips for small business entrepreneurs are to be sure you’re invoicing promptly and utilizing technology to control employee spending.
#2: Evaluate your credit card use
Review your overall finances and evaluate if credit cards are the best option for your small business. You should never need to draw on your credit to run your business better. You shouldn’t risk your personal credit score by using your own credit cards at work. Furthermore, because the banking industry isn’t built to serve the needs of new entrepreneurs, if you run a startup or a new business, it may be challenging to get credit in the first place.
Those of you with business credit cards should also evaluate the risks and rewards of using said cards. If an employee does misuse a card, the charges could be fairly expensive and your business could quickly find itself in debt. Credit cards often have high interest rates, and even the best business credit cards lack the same protections as consumer credit cards. In addition to unannounced rate hikes, cardholders aren’t guaranteed fraud protection, although some card issuers have generous protection policies.
In 2020, consider a corporate debit card program instead. Most corporate debit programs make use of several features that save you the time when going over your monthly charges. Additionally, their monitoring tools helps prevent cases of fraudulent activity, like if one of your employees accidentally uses your credit card for a personal expense.
#3: Grow your social following
If your business isn’t on social media, you’re missing out on engaging with new potential customers. In addition to making sure your business is on the right social channels to engage with your audience, be sure to post creatively with relevant industry hashtags and on-brand images of your offerings. And don’t limit your business profile to just Instagram and LinkedIn: social media also includes Yelp and Google Local.
You should regularly update your information on these sites, and check Google Maps to ensure that the location of your shop is accurate. Customers shouldn’t have to hunt for your business. Finally, when a customer asks a question or leaves a review (good or bad) over social media, use this as an opportunity to reply directly on the original thread. Personalized, conversational social media responses will show your customers that you’re tuned into their wants and needs—and it adds a crucial human touch to your business.
#4: Reduce your costs
If you’re trying to cut costs, I encourage you to build a strong bond with suppliers. Often times, if your suppliers like you, they may offer your business discounts in the future, or they may allow you to buy in bulk. Purchasing materials in bulk is often more cost-efficient than buying only what you’ll need this month, so plan your inventory with the widest forecast possible (a quarterly, six-month, or nine-month event horizon) to increase your profit margins in the long run. It’s hard to survive as a small business, and relationships are absolutely everything.
In that vein, track your inventory: the occasional inventory audit is the best way to ensure that you aren’t buying too much, and surface employee theft issues. If you find inventory tedious, or lack the staff to regularly check, explore automation and smart tools to track your supplies, save time, and boost efficiency.
Finally, even the best-intentioned small business owners can fall prey to impulse buys and other unnecessary expenses. Before you buy something new for your business, ask yourself—do I really need this, now? Will it reduce my costs and increase my profit? Or is it simply nice to have?
#5: Make sure your website is up to par
When’s the last time you updated your website? Too many great small businesses are dragged down by outdated, difficult-to-navigate websites. It’s the 2020s—bring your digital presence to the next level! Hire a web developer to run an audit and fix any potential issues that are preventing your customers from engaging with your site and seeing all that your business has to offer. If you know a busy season is coming up, speak to your hosting company and be certain that your website has the bandwidth to handle sudden spikes in traffic. If you’re offering special discounts, be sure to highlight them on your homepage under your featured products category!
Farhan Ahmad is CEO and co-founder of Bento for Business, a complete B2B payments solution that helps small and medium-sized businesses (SMBs) gain full control over their cash on one platform. A veteran of Discover and JP Morgan, Farhan exchanged Wall Street for Main Street to empower SMB owners with a powerful financial operating platform that creates value for their customers. With Bento for Business, companies receive unprecedented control and visibility over their expenses, mitigating fraud and administrative overhead.