The No. 1 Priority for Small Businesses This Year Is to Increase Revenue — Here Are 4 Ways to Do Just That. Success can be measured differently by different people, but regardless of how you view success, setting a goal and understanding revenue targets for your business can help in planning for and achieving a fruitful year ahead. Here's how.
By Rich Rao Edited by Kara McIntyre
Opinions expressed by Entrepreneur contributors are their own.
As 2024 begins, goals and resolutions are top of mind. According to a recent report by Intuit QuickBooks, the top priority among business owners is to increase revenue, above getting financing or launching new products or services.
Increasing revenue is no easy feat, but entrepreneurs can employ a variety of strategies to help achieve growth in 2024. Even if some macroeconomic pressures like inflation and interest rates may ease this year, they are likely a continued concern for businesses. By looking for new ways to modernize and improve business processes, entrepreneurs can be better positioned to power momentum in 2024 and beyond, even in ever-changing economic conditions.
Related: 4 Secrets to Turbocharging Revenue Growth Every Executive Must Know
Hire skilled workers
Having good employees is key to business growth, and in 2024 business owners say it's a top priority, even ahead of cash flow. Entrepreneurs believe hiring skilled employees will help them meet increased customer demand, and most employers (89%) want to hire more employees or contractors this year. But hiring can also be costly and according to one study, the average cost per hire was almost $4,700 when you take into account onboarding, training and the ramp up to productivity.
Expanding the workforce is especially top of mind for younger entrepreneurs, with more than three-quarters (76%) of Gen Z small business owners and 80% of millennial small business owners saying they want to hire employees this year. Compare this to just 34% of baby boomer-owned small businesses. In terms of how to hire qualified workers, I recommend business owners be very specific when developing job descriptions, zeroing in on the problems and challenges you're trying to solve with the role. And by offering employee benefits like health care and paid vacation, small businesses will be better positioned to compete with larger enterprises in attracting top talent.
Optimize inventory management to enhance omnichannel sales
As business owners embrace omnichannel sales, selling across multiple online and in-person channels can maximize revenue but can also add new complexities to running your business. Have you ever ordered a product from a business, big or small, only to find out it's actually sold out? Optimizing inventory management so you can deliver the best customer experience is key for success and continued consumer loyalty.
Take for example Matt Paggi of Barred Woods Maple, a QuickBooks customer who shared with our team just how crucial a positive first-time shopping experience is — especially during the busy holiday season. The holidays are typically when they do almost a third of their annual business, and each year they see returning customers who've made gifting their maple products a tradition. To help ensure they can manage increased inventory needs they've expanded their presence across various channels to capture both new and returning customers, ramped up production ahead of time and brought on seasonal employees.
For business owners like Matt, my number one piece of advice is to use the power of data analytics to optimize inventory management and sales strategies. This includes looking at your sales history to identify the most popular products and impactful channels to drive strategic decision-making and maintain a real-time understanding of stock levels to avoid over and understocking. Additionally, data trends around the cost of raw materials can also help business owners know when they need to buy in bulk or scale back on production.
The data shows improving and expanding omnichannel sales is particularly important for Gen Z entrepreneurs, with 88% of Gen Z small business owners looking to expand ecommerce or physical locations to boost revenue in 2024 compared to 66% of Gen X and baby boomers.
Related: These 4 Quick Wins Can Boost Your Customer Count and Revenue
Dynamic management of cash flow and credit card debt
To make money, you have to have money on hand. Access to cash and maintaining healthy cash flow is essential to small business survival. Whether it's earmarking enough cash to cover overhead costs if payments are late to paying for unexpected expenses and emergencies, business owners have to be ready for the inevitable curveball that will come their way.
There are a few simple ways business owners can build a cash flow cushion. First, know your fixed and variable costs and monitor cash flow projections regularly to spot potential problems before they arise. Digital tools can be incredibly valuable in providing you with real-time insights that can help you plan ahead and react quickly. I also recommend treating cash flow savings as a fixed expense and setting firm guidelines for when you'll tap cash reserves.
Entrepreneurs also should be mindful of how they use and manage credit cards. Recent data has pointed to the increased reliance small businesses have on credit cards to manage cash flow — 83% of business owners have relied on a credit card to manage their business finances, and 59% of business owners who use credit cards said it was "an emergency or temporary source of funding."
What's more, almost 24% of small businesses don't believe they will be able to pay off their credit card balances in 2024 without paying interest. It's important to have a strategy when using credit cards to manage cash flow — and to ensure you stay on top of managing your interest rates on the cards you use — otherwise, this could be a costly expense in the future.
Related: 6 Strategies for Optimizing Cash Management When Starting a Business
Set your financial goals
Whether it is setting an intention for the day or creating a workback timeline to hit a big business milestone, goals are an important part of a business owner's journey.
As we kick off 2024, business owners should evaluate what financial goals will make them feel successful. These financial goals can help provide a clear sense of direction, serve as a benchmark for progress and success or unearth areas that need improvement. They can also serve as a road map of your longer-term mission or vision for the business and can ultimately help fuel overall growth.
Success can be measured differently by different people, but regardless of how you view success, setting a goal and understanding revenue targets for your business can help in planning for and achieving a fruitful year ahead.
