Bounce Back Loan: How to get more bang for your buck
Bills? Debts? Wages? Or investment?
If you’ve received a Business Bounce Back Loan and are currently scratching your head wondering what to do with it, you’re in good company. More than 110,000 small businesses applied for the scheme on the first day of its launch – and savvy business owners will use the cash injection wisely.
At first-glance the loan sounds promising; nothing to pay for 12 months and a low-interest rate at 2.5% to follow. But you need a clear strategy to put that money to work so it gives you a return. If you can’t make more than the 2.5% charge on the money borrowed perhaps you shouldn’t be in business in the first place!
Whether you’ve received £2K or £50K, how you use the money now is crucial.
With thousands of businesses losing their income seemingly overnight, there’s no denying that the scheme has been a lifeline. But aside from taking care of your immediate financial obligations like wages, creditors, and the unavoidable day-to-day costs that keep you running, there’s an opportunity here. If you’ve got the basics covered, you should be looking to turn this opportunity into profit. Here’s how:
First things first: where do you want your business to go?
Take a step back and consider where you want to be over the next 3, 6 and 12 months. What will your business look like, and where can you invest to have the biggest impact? Use this time productively to make sure you’re in the perfect position to serve your market in today’s world. Remember, your market demands and how you fulfil them may look very different in the future.
Resist the temptation to rush out and buy new toys
You’ve always wanted a state-of-the-art Mac/latest iPhone/Lamborghini (delete as appropriate). But the question you really need to ask is: does this buying choice support the long-term growth and success of my business? Seriously – this is a golden opportunity IF you invest wisely.
For instance, the bounce back loan gives you an opportunity to invest in marketing strategies like improving your website or stepping up your PR. Diversification into new products could also be a good move to make sure you build on any growth you had before the pandemic. Diversifying can help you future-proof your business to make sure you’re less dependent on certain sectors, products or large clients which previously left you vulnerable.
Invest in your systems
You should think about how to keep the momentum of recovery going to turn it into further growth. How are your business systems running these days? If there’s room for improvement, the following are worthy of investment:
Sales and marketing
To create revenue for your business – and essential for growth. Remember to focus on your ROI and use targeted campaigns. If the numbers say you’ll get the biggest return by posting flyers through letterboxes, do it. If Facebook ad campaigns have generated leads, invest there.
To ensure a great service to your customers. Your business can live or die by the quality of the customer experience, and those 1-star reviews can seriously damage your credibility. How can you make things easier and more efficient for you and your customers? How can you provide a service that exceeds expectation?
To collaborate well with others and create more capacity. Using your bounce back loan to invest in a decent CRM, project management tools, and an integrated payment platform could be a smart move. They’ll help you keep track of your customers, your communications, your staff or associates, and your finances. More importantly, they’ll give you the building blocks of a bigger business.
It’s FREE money*
*For 12 months.
Remember you’re going to have to pay this money back. Yes, the interest rate is low but the nightmare scenario would be to end up in worse shape than you were pre-Covid. I’ll say it again: Invest this money wisely.
Still not sure how to use your bounce back loan effectively?
I’ll be more than happy to help, even if it’s just to hear your story and suggest what I would do! Click here to book a call with me.