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Increasing your revenue (which will directly influence your cash flow) comes as the result of 3 main changes:
1. Increasing prices (not always feasible in today’s economy),
2. Increasing the number of customers (this is difficult and requires dedicated time/ money to invest in marketing) and,
3. Increasing the average revenue you get from your current customers.
I know which one I would choose!
As the old saying goes, a bird in the hand is worth two in the bush, so make sure you take steps to nurture your existing relationships and continue to offer more value to your customers. Pareto’s Law states that 80% of your revenue will come from just 20% of your customer base, after all (this is also often referred to as ‘The 80/20 principle). They already trust you, so they will be more likely to buy from you than anyone else if you offer them something new/more.
If you lose a customer through bad service, dissatisfaction with a product or relations you will need to spend twice as much to replace that revenue. Cash flow always suffers when this happens.
Want to know more? Read our eBook:
Subscribe by email and instantly get FREE Illustrated eBook. Adequate ‘positive’ cash flow is essential for the survival of any business, yet this is something that over 50% of small business owners struggle to manage.