Is there a business that doesn’t suffer losses? I believe not! Every business owner understands that profits and losses are part and parcel of it. And, while a business may generate a million dollars in profit every year, it can also suffer considerable losses in a day.
However, what’s not acceptable to me as a small business owner is the leaking holes. In layman’s terms, a leaking hole is when a business suffers losses due to operational inefficiencies like mismanaging resources, accounting errors, underutilizing of resources, and more.
There can be several leaking holes in a business, and it’s crucial to fill them as soon as you identify one. Here, I will discuss some major, yet common challenges and explain how you can fix them. So, let’s start.
Inefficient Spending
Generally, every business spends money to earn money. While some of this spending is absolutely necessary for business operations, some, like overhead costs, can be cut down. While it may be difficult to slash necessary expenses, there are a lot of ways to lower the overhead costs.
Overhead costs can be fixed or variable, and include utilities, rent, salaries, office supplies, and other expenses. Also, these expenses are recurring in nature, so overhead costs will be incurred regardless of whether your business is booming or not.
I suggest you think out of the box to slash down this expense. You can explore various aspects, be it the supply chain, logistics, or administrative work to identify and lower the overhead costs.
Looking for a start? Well, let me tell you how I found a leaking hole in my business expenses and lowered it.
Internet and phone are basic requirements of every business. From using different tools to staying in constant communication with your team, both utilities are fundamental. And, just as I was looking for ways to reduce my overhead costs, I thought of bundling my internet with my phone.
So, I explored various ISPs that offered bundled plans and subscribed to Spectrum Deals as they were the most affordable ones. This way, I lowered my overhead costs and paid less for these essential utilities.
Ineffective Marketing Practices
Marketing your business is important, especially on social media platforms where you can reach millions of potential customers. If your marketing strategies are ineffective, then it is probably because they’re a leaking hole in your business.
Having said that, marketing is one of the major expenses in a business, and there are several ways to lower its cost.
I’ve seen several businesses sticking to the same marketing strategies for long periods. Over time, marketing strategies become redundant, and I see no point in running outdated campaigns.
Furthermore, since several social media platforms are available for marketing your business, you don’t need to target all of them.
You just need to identify the social media platforms that the majority of your target customers use. It’s best to market your business on such platforms and leave the rest. For example, running paid campaigns for extensive periods without fruitful results can be demotivating and costly.
Poor Customer Support
Reliable customer support isn’t a luxury but a necessity that every business should offer to their customers. Poor and unresponsive customer support is one of the biggest leaking holes that most businesses don’t pay attention to.
Also, it’s a misconception to think that the role of support ends as soon as a customer buys a product or service from a business. On the contrary, a customer may have queries, and not responding to them on time can lead to dissatisfaction.
So, with this leaking hole, businesses are at risk of losing customers in the long term, which eventually would impact their future profits.
One way to deal with this leaking hole is to get help from AI (Artificial Intelligence) chatbots. Small businesses have limited resources and manpower, and, understandably, they might not be able to spare them for customer support.
In such situations, businesses can easily create a chatbot and train it to handle general customer queries. This way, a chatbot would answer your customers’ queries, and they won’t feel ghosted.
To wind up, leaking holes silently drain your business profits. And, it’s vital to understand that minimizing your business losses directly translates to better profit margins. So, thoroughly examine your business operations to find such leaking holes, address them effectively, and save your business from unnecessary losses.
Holding a Master’s in Library and Information Science from the University of Illinois, Josh Clarke has dedicated more than 15 years to managing and disseminating information across various platforms. His professional journey includes significant experience as a research librarian, where he developed an expertise in sourcing and providing accurate and comprehensive answers to diverse questions. In 2018, Josh brought his rich experience to our platform, quickly establishing himself as a reliable source for general FAQs. He has been overseeing our information curation since then, combining his research skills with a flair for engaging content delivery. When not involved in information management, Josh enjoys exploring digital photography and participating in local quiz competitions, hobbies that complement his inquisitive nature and love for learning.
