It’s an awful feeling when you think your business may be losing money.
Money leaks in your business are never good. Sometimes we know without a doubt that money is leaking from somewhere but other times the leak is more subtle, and we simply suspect that we’re not holding on to as much of the revenue as we should be.
Money leaks show up in a variety of ways. You could be having leaks in your expenses, leaks in sales conversions, leaks as customer loss – those are just to name a few. The important thing is that you don’t ignore it. Otherwise, if there is a leak, it will only get worse. If you suspect your business has a money leak somewhere, here are three steps to take right away.
3 Steps & Solutions -
Step 1: Determine WHERE the leak is.
It’s not enough to just suspect a leak, now you have to figure out where it’s happening if you’re ever going to fix it. To do this, you need to review the data. Look at your income, your expenses and everywhere that a conversion opportunity is to see where the performance is lacking. Look for changes in trends or anomalies that you can’t explain. If you’re not sure exactly how to read the data you have or where to find the right data, it’s time to seek out the help of a professional.
Step 2: Determine the CAUSE of the leak.
Once you find where the leak is, you need to figure out what caused it. This is critical because you certainly don’t want to keep having the same problem over and over. Look at the process associated with where the leak occurred and troubleshoot options to ensure that you never have to worry about this again. It may take you some time and you may have to dig deep but don’t give up. You need to get to the bottom of it (literally) so you can prevent it from happening in the future. Causes of money leaks in your business can show up in many ways – operator error, system malfunction, poor technology, and more. Look into every nook and cranny of your business
Step 3: FIX the leak.
Depending on the type of leak and its cause, it might be as simple as tightening up your procedures. If your leak is in expenses, then eliminating those unnecessary charges will help to solve the problem almost immediately. Some leaks, however, may take both some time and money to fix but keep in mind that even if it costs money to fix it, if in the long run it leads to no longer leaking money, then your corrective action will pay for itself.
Taking these three simple steps as soon as you suspect there is a leak could prevent you from major losses. As you go through the steps, make sure to consider what you could have done to avoid the leaks in the first place because prevention is certainly better than going in after the fact to find and fix a problem.
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Holly Kile - Marketing Assistant