Investing Back in Your Business

It can be a heady thing to start making profit with your small business. But before you blow it all on a yacht (or even a tiny replica of one), set aside some money to invest back in your company.

Piggy-Bank

Gordon Hester makes a good point about the difference between an investment and an expense. An expense is something that has to be paid, like the light bill. No one’s forcing you to invest back in your company, but as he says:

“the desired outcome of ANY investment in a business is to produce a result greater than the investment itself.”

So while profit is great, growth is better. Consider what you want your business to look like in a year, three, five, ten. Likely you’d love to add some employees to lighten your work load. Expand your facility to store more inventory. Buy larger orders to realize cost savings. Open new branches. Take a vacation. All of this takes money, so in order to do these things, you have to help your business grow.

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