What insights can you get from your business with Tyro?
Sometimes you need to spend money to make money. But choosing what to spend your business’ hard earned profits or precious working capital on is no trivial decision. Invest wisely and you can exponentially grow your business. Invest poorly and you could find yourself losing money hand over fist. Welcome to part one of our Investing for Growth series, where we give you the ideas you need to supercharge your business’ growth in 2017.
Dream big. Start small. But most of all start
If you’re new to investing in your business, the trick is to start small and learn as you go. This is a great way to build up confidence in applying bigger and more capital intensive growth strategies. Starting small is a far better way to learn what will and won’t work before you decide to part with serious dollars and go for broke.
To help get you inspired this January, we spoke to two small business owners who did exactly this. Here are their stories.
Pizza shop gets savvy with social media
Being on social media doesn’t have to cost you a lot if you’re smart and creative about how you use it. Buying into a pizza store when he was only 20 years old meant small business owner Rory Jones had to find cheap but effective ways to use Facebook to grow his customer base from scratch.
“One of our most effective strategies was the menu special we called Pizza of the Month. Each month we would create a new pizza, trying to make it really interesting and different to our current menu items or those of our competitors. Examples included The Nacho Pizza, The Butter Chicken Pizza and even a Hot Dog Pizza.
Most restaurants use this strategy but we made ours stand out by using social media and humour. I created posters for the store as well as images for our Facebook and website. They would usually feature some sort of joke. For The Nacho Pizza the posters had a nacho chip and avocado character with cartoon faces on them.
The funny pictures were key because once I posted them on Facebook people would share them and we’d get more exposure. More exposure meant more pizzas sold!
After each month the specials became more and more popular. I remember on its first weekend, The Nacho Chip Pizza sold out on the Friday within the first couple of hours! To get us through I had to stock up at a supermarket so we could make more.
It took a while to get to that level as I had decided to do all the graphic design myself. I had very little training in graphics bar a digital media class in high school, so it was pretty time consuming to begin with. I wasn’t nearly as good as a professional would have been! But in the end I got there and proved the concept worked.
Given it was such an effective way to grow sales for my business, if I had cash to spare next time I’d be confident investing this in a graphic designer. For me it would mean new growth would happen a lot faster and would absolutely be worth the investment.”
One man’s blocked drain is another man’s treasure
When John Cook got Johnny Plumb Plumbing off the ground he’d already sunk $25K of his own savings into equipment and start-up costs. After a month or so in business he noticed he was fielding more and more requests for helping out with blocked storm water and sewerage drains. The only problem was he couldn’t do the work as he need a specialist piece of equipment that retailed for about $2K.
Not wanting to miss out on the business, he did the sums and realised that if he could find the capital to pay for the equipment, after only 8 uses he could effectively repay it. After lining up his clients, he used a pre-approved personal loan through his bank to finance the purchase.
“Definitely doing the sums and being confident about repaying the loan quickly was key for me. I didn’t really want to take on additional debt, but this opened up a huge growth opportunity for the business. If I’d had to keep referring the work to other plumbing buddies, I would have probably lost the whole relationship with the customer, which is never ideal!
After this experience, I definitely feel more confident assessing other growth opportunities and weighing up if they are worth the investment, especially if it means I have to take on debt. The bar has been set high by the drain cleaner, that’s for sure!”
Spot the opportunity for your business
Look around and see if there is something small, actionable and low cost that you could implement in January. Best case scenario means you’ll see additional sales for nothing more than a bit of sweat and time. Worst case scenario is you will have learned what doesn’t work, with the silver lining being you didn’t invest thousands of dollars in the process. No one likes expensive mistakes.
Once you’ve proven your growth ideas work and you’re ready to scale, then accessing working capital might be the logical next step. Tyro now offers eligible EFTPOS customers loans between $500 and $120K, repaid as a small percentage of their daily EFTPOS settlements (minimum repayments apply). To learn more, click here.