One of the biggest worries business owners have is cash flow and income. I’ve known many businesses that have had to shut up shop when they’ve lost a client, or a manufacturer has stopped making the product that is their best seller, or other such problems.
The issue here was relying too much on one source of income. Much as financial advisers suggest spreading the risk when it comes to investments, so should a business owner think about multiple sources of income. That way, you avoid reliance on one thing alone – you’ve got to be pretty unlucky to lose a few clients in one month, at the same time, say as a tenant renting a property you own to vacate. So whilst your income may fluctuate each month, the likelihood of it dive-bombing is fairly slim.
Think about it this way, it’s easier to bring in three lots of £1,000, than one lot of £3,000. And of course, if the £3,000 one comes to an end, it’s more of a big deal than if one of the £1,000 jobs finishes.
But that’s all very well, I can here you say, but how on earth do you go about building a business based on this model? Surely more income streams take more time, and as a business owner you are already stretched? Not if you are clever, is my answer, so here are my tips on what options might be available to you:
• Under these headings: products, services and other, think about how your main business could expand. So, for example, if you are a graphic designer, what products could you develop that you could sell? Could it be a book? Course? In terms of services, could you offer a workshop to businesses, or to entrepreneurs? When it comes to others, then you can think about affiliate/referral schemes to set up, or how people could possibly pay you to advertise – on your website, your building etc.
• Then think outside your business. What can you do to bring additional income that isn’t related to what you do every day? What are you passionate about that you could possibly turn into an income stream? For example, you could make jewellery, could you sell it to friends and family? Perhaps you are pretty good when it comes to sports – could you take up coaching at the weekends?
• Think about investments. You don’t have to have thousands to start, but it can be something that works for you in terms of the return you are getting. Always remember to seek professional advice to ensure that the investment is right for your circumstances
• Property is always a good one to explore if you are able. Again, seek professional advice, but you can think about becoming a landlord, or even doing up a property and then selling it on if you have some funds there to get you going in the right direction. Or if you don’t have the capital, what about renting space out? Doesn’t have to be a room in your house, your parking space or garage could bring in some cash each month with little effort on your part
• Make money for things you are doing anyway. This one is just knowing how to be a little bit savvy with things like cash back, or even doing things like mystery shopping or filling in surveys. Why not get paid for tasks you do now? It’s just learning to think about how you can potentially benefit financially for little effort, but big rewards
One piece of advice – don’t try to do all at once. Start with one additional income stream, and get that up and running before beginning another. Ensure that it actually works, and fits in with your life and your business. If it doesn’t work, leave it, and move on. Don’t spend more time trying to make it work than you are actually getting in return.
But you might as well give it a go. Set something up now, and it may mean a few extra pounds brought in, to help you out ahead of Christmas – and that wouldn’t go amiss, right?
In terms of your business, expanding into several different income streams will not only spread the risk, but alleviate any concerns about income (especially if you are reliant on clients, for example) as well as giving you some variety. And variety, as we all know, is the spice of life. So get diversifying!