If starting a new business or looking to grow an existing one, additional finance is an essential key that can unlock that potential. There are several different ways in which a business owner can generate or secure that extra capital. But knowing how to achieve that isn’t necessarily as easy as it seems. Formal small and medium enterprises (SMEs) in India and the broader south Asia region can encounter a significant funding gap, according to the World Bank.
So, what strategies can you use to expand your business and achieve that capital growth? The good news is there are several different paths to choose.
1. Boost your customer conversion rates
For existing SME owners, enhancing your current conversion rate optimization (CRO) can be a truly effective strategy to adopt – particularly if you have an online presence. It’s thought that acquiring new customers is five to 25 times more expensive than retaining existing ones. With a strategy that drives loyalty and conversions, it can bring huge benefits to your bottom line.
2. Apply for additional loans and finance
For Indian SMEs, the lack of adequate access to finance is a historic bottleneck to growth. This is not – thankfully – as significant an issue anymore. And being able to access bank finance or loans can have a positive impact on SMEs and micro businesses alike. A 2018 study underlines how much of an impact this can have too. 80% of all SMEs grew their sales, income and assets since the introduction of accessible loans.
3. Make your existing capital work for you
By making wise investment decisions with the capital you already have, it can generate healthy returns to support and enhance your business. Market trading is certainly an attractive option – and the lowest spread forex broker, for example, can help make your capital go further. In any investment decision, however, diversification is an important consideration to mitigate your risk and achieve your long-term financial goals for your business.
4. Go in search of more external investment
It could be that you’ve taken your business as far as it can go on current levels of capital. This is when the opportunity to invite external investment could take you to the next level. You can find angel investors with an interest in what you do. Or you may be targeting the multi-billion-dollar Indian venture capital market. The potential capital growth could be hugely significant.
5. Crowdfunding or community capital growth
Some businesses have a loyal and dedicated following. Others, meanwhile, have products and services that consumers feel best align with their lifestyles and/or beliefs. That’s when it could be an option to seek crowdfunding or community investment. It’s also a helpful barometer for gauging what you do as a business – helping you define your overall strategy going forward.
Making the most of your capital growth
With various strategies available for boosting your capital and expanding your business, there’s a potential route for every SME. While the risks of individual options are greater than others, so too are the rewards. Accessing additional capital can transform your business – and lift it to the next level. With patience, perseverance, and a forward-thinking attitude, anything is possible.