Making time for marketing crucial for business success
Q I run a beauty salon in a small regional town. We are not great at marketing and our sales can only be described as modest. Are there any tips you could give us?
You are correct to link your lack of marketing and the sales performance. In my experience, businesses that trade well are usually great marketers also. Sometimes when we think of marketing, we think of formal ads in the paper, or digital media strategies, but in fact it is any way that the business stands out from its competitors and communicates this to a wider audience. As well as the more structured marketing tools, this also includes word of mouth.
The marketing tools themselves are not difficult to highlight and I am sure the list of tips for creating PR for your business right through to various paid-for advertising techniques will not be unfamiliar to you. What I want to focus on is why this marketing is not taking place. Is it that you are not focused on marketing yourself which is causing the challenge?
I have no doubt that your customers will rate you highly as a beautician and that could be where your real passion lies, but if you don't dedicate some time each week to create plans on how to market and promote the business, there is a danger that all the good work you are doing could become a 'best-kept secret'.
Customers need to be stimulated and they need lots of reminders that your business exists on an ongoing basis. A key priority should be for you to free up one hour a week to develop the marketing strategy of the business.
Within a few weeks, sales should start to grow gradually and you will get great satisfaction out of trying different initiatives when you see the corresponding revenue rising. Of course, not every marketing technique is going to work, but you have got to try as many new initiatives as you can to identify what works best for your business.
Q My husband and I have been locked in a battle with a bank over a mortgage that was taken out 10 years ago on our business. The disputed amount is close to €1m. I need to invest some money in the business and borrow approximately €200,000 and I am worried that we could be overstretching ourselves.
A That must be a real stress and worry for you and I can only but imagine that it must have been terribly difficult for you to keep the business running at the same time. I applaud you that you are thinking positively about how you can grow the business into the future despite facing many distractions.
It is difficult for me to provide accurate advice with only limited information, but based on what you have told me, I would advise that you exercise caution. For as long as you have an undisputed amount of money with no clear agreement in place as to how it is to be repaid, that will cause uncertainty. If you had certainty from your bank on getting a decision, then that would change the landscape completely, as it would be very much a numbers-based decision based on the business's ability to service both the legacy mortgage and any new borrowings. Priority one has to be to get a fast decision from the bank. I understand that might not be easy, especially bearing in mind that it has dragged on for 10 years. I do hope you have the best professional advice you can get to guide you on this difficult process.
You need to keep the business growing and moving ahead and perhaps there are some practical steps you can take to try and improve funding within the current business model.
Have a look at the credit terms you have in place with your suppliers and see can any of these be extended or altered so there is more cash flow within the business. Look at stock levels and see is there surplus stock within the business that could be cleared out to release further cash. Explore to see if it would be possible for one of you to get a permanent job outside of the main business in order to generate another revenue stream.
There will be dozens of other possible approaches, but my strong advice is to stop short of borrowing any further money until you have greater clarity.
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