How to Use a Trade Facility to Increase Your Profits
On this episode of Get to the Contest Small Business Podcast, our guest is James Tasses, the CEO of Bizsmart Finance Australia, an organization that works with SMEs to solve the finance and cash flow challenges of growing businesses.
Here are the key takeaways from this episode:
Understand your business and use your facility to drive growth. In the event of extra cash or cash flow, be familiar and understand what this will allow you to do. Have a steady cash flow in place so that you can go and seek new opportunities.
Make the facility work for you. Now, don't do it for all suppliers, just target your top 20%, and get out there and see if you can work with your suppliers to gain a significant reduction in your costs, just by offering to guarantee certain payment terms. It's amazing what you can get if you have an ability to get out there and guarantee someone some certainty around their cash flow, they will give you a discount in many cases.
Learn from your losses. When times are rough, take this time to sit back and reflect. Keep a diary, make notes, and make sure that you don't put yourself in that position again. When everything's going well, and anyone can grow a business, it's when times are tough that you really are showing your value as an entrepreneur and as a leader, to guide the business out of tough times.
Learn from the Wolf of Wall Street (a 2013 American biographical black comedy crime film directed by Martin Scorsese). There’s a great scene in the movie where the lead said “If you can’t pay the bill, get on the phone. If you can’t afford the holiday, get on the phone.” If something's not working or going your way, get on the phone and make it happen.
Know your client first. Understand them. Build relationships before you prescribe any solutions. If you're an expert on your customers, they will come to you and you will be able to help them.