By being ruthless and getting rid of unnecessary weight, youll be better prepared for growth and development. My business has seen exceptional growth since its beginning in 2000; here are three ways that I keep the company lean and profitable.
(1) Tightly manage invoices
One of the best ways to ensure that your company keeps itself lean, is by making sure that you’re always on top of your invoices.
By having an organised filing system in place, youll be up-to-date with whats due and when. I make a point of paying invoices as soon as they arrive; this way, there will be no nasty surprises at the end of the month when the statements come.
Keeping a strict watch over your business cash flow is an effective way of guaranteeing that it remains lean. Whether you entrust someone else within the company with this responsibility, or choose to do it yourself is up to you; as long as someone is on top of payments and money owed, youll be off to a good start.
Finally, be sure to leave a paper trail; even if you choose to deal with invoices via post, always have an electronic copy handy. This should help to keep things organised and ensure that nothing slips through the cracks; youll always know where the business money is going.
(2) Negotiate aggressively
There are so many different aspects to consider when keeping a business lean and from the very beginning I have placed huge importance on being smart about our suppliers.
One of the problems that many startups face is that as they start to grow and gain brand awareness, suppliers will be quick to raise their prices. If you want to remain lean, you can’t be afraid to be aggressive in your negotiations every deal should result in good margins.
Researching a suppliers competitors is vital, especially if you want to get them down to their lowest prices; by slipping in the competitions name, you might find yourself walking away with a better deal.
You should, however, check that the supplier you plan to negotiate with doesnt already monopolise the market; if they do, theyll have the upper hand, and you might find that theyre unwilling to budge on their costs.
(3) Grow organically
By keeping a close eye on CV-Librarys KPIs, which are primarily the number of clients that we have on board with us and the rate at which this grows, I am able to make sure that the company is growing organically.
If you’re trying to keep your business lean, ideally it will be funding itself; by reinvesting your companys profit and enabling further growth, you should be on track to keeping your business lean and efficient.
Boosting your KPIs is a great way to bring in more revenue and ensure that you are on the right track for organic growth.
The reality is that, to keep your business lean and profitable you have to be ruthless. Constant updates and analysis will help to guarantee that your business is running efficiently and that you are getting the most out of your employees.
With the right training and the right tactics there is potential for you to achieve the best possible rates for your company, ensuring that you stay lean and grow as an organisation.
Lee Biggins is founder and managing director of CV-Library.