There no person more happier than one opening his or her business for the first time. At this point in time, the future looks so bright it is almost blinding.
“It is usually catastrophic, especially for a first-time investor, when everything seems to crumble apart after you realize you are not making enough money, not making any money at all or actually operating at a loss,” said Issa Asad Florida businessman and entrepreneur since 1996. Mr. Asad is the CEO of Q Link Wireless and Quadrant Holdings, located in South Florida. He is also the author of 4 e-commerce and marketing e-books that can be purchased on Amazon.
Here, Issa Asad Reveals 3 Reasons Why a Business Doesn’t Profit:
High operating costs
This will normally affect new business owners who have not yet sufficiently learned the ropes. There will always be unanticipated overheads which eat into your profit that you did not anticipate.
Despite the fact that these costs were not planned for you will still have to cater for the same; if you did not save up for such mergencies’ then you will have to pay for this from your profits which may considerably lower what you take home. Such costs may include simple things like power and water bills in the case of say a restaurant or car wash business.
It could also be more complicated logistics such as transport and labor. To avoid this you need to make sure you have done sufficient research on the kind of business you are going into. You need to be certain on each and every cost to the closest approximation in cases where the cost of materials and services needed to run the business fluctuate. You also need accurate figures for the more predictable expenses.
Another reason your small business isn’t profiting as per your expectations may be because you have not put a cost in the final product that is inclusive of all the work that has done into delivering the same. This will include all the time spent on managing different aspects of the business and including small expenses here and there that may not seem significant at the time you are incurring the same.
So take note of every expense and human labor that goes into your business and come up with a reasonable price that is competitive but also compensates you for your wholesome input.
You may have the best product or service but your potential clients need to know that. It is your sole responsibility to ensure your brand is well marketed, understood and accepted.
With these three elements in play, an existing client is able to sell the brand on your behalf more effectively. You also have to read and beat competitors’ marketing strategies to stay on top.
All in all, take your time to understand and plan appropriately for your small business for greater success.