A major concern of minority and women business owners is how to KEEP their corporate clients once they land them. The most common things that come to mind are delivering good quality, service, and price. An often overlooked area in your small business that is critical to corporate client retention is its financial health.
You must have a handle on the numbers and should at all times know the financial health and trends of your business. It is never a good idea to try to manage your business by gut instinct!
Here are 4 things you can do to monitor your company’s vital signs. After all, that’s what good CEOs do….
- Be able to understand your financial statements and what they are telling you.
- Have your Accounting Manager or CPA put together simple metrics to help steer your business such as daily/weekly sales, gross profit margins, aged receivables, etc.
- Make sure you have a top-notch CPA, banker, and financial planner as part of your advisory board.
- Take classes to learn what you do not understand about basic accounting concepts and financial reports.
Corporate clients are very risk averse and often check Dun and Bradstreet and other financial reporting tools to check the financial health of diverse suppliers before awarding them a contract. They may also check your risk profile to ensure your remain fiscally strong after the contract is awarded. You can lose business if your financial scorecard is not in pristine condition–even if you have a solid performance record with your corporate client.
Do not underestimate the importance of your business’s financial health–the numbers don’t lie!