Guidant Financial Group Blog

Although the instinct during a recession is to hunker down on spending for new business owners, a new story in Entrepreneur cautions against entrepreneurs tightening their wallets too much (see Less is More).

Apparently, there is a thin line that business owners need to walk – a line between spending too much and fatally injuring the bottom line, and spending too little and cutting the legs out from under the business’s growth.

The Entrepreneur article suggests that, instead of drastically cutting spending, to search for new profit potentials. Some businesses may discover they have growth opportunities available to them that they were oblivious to during more stable economic times.

Some things that Entrepreneur suggests are:
• Take a look at any freebies you are giving away and see if you could charge for them (i.e., charging for delivery services or moving to an a la carte pricing model)
• Re-evaluate your pricing structure
• Consider how to sell more to existing customers

Fortunately for our 401(k) small business financing clients, they may have a little more financial leeway during today’s tight economy. Because Guidant’s 401(k) small business financing solution enables people to access their own funds to finance their business, new business owners do not have to worry about loan payments.

No matter what financing methods business owners use, figuring out innovative ways to increase profits is never a bad idea!