Investing in People and Their Brands Rather Than in Working Capital or Physical Assets
Investing in People and Their Brands Rather Than in Working Capital or Physical Assets
In order for your business to be successful, you must be willing to devote a significant amount of time, energy, and money when you start it out on your own. In order to put your business plan and marketing strategy into action, you must first authorize a spending plan and then approach various entities to provide funding, such as banks, credit card companies, friends, family, and employees. It is not finished yet. Where should you put your money to make your business stand out from the crowd? That is the question you must answer. I propose the following investment priorities for maximum flexibility: Priority is given to Brand Capital, then Human Capital, Working Capital, and Physical Capital is at the very bottom.
Brand Capital: Put your money where your mouth is: on marketing to your target audience. It may start off as a simple matter of targeting a certain group of potential customers. Make sure they are happy customers by doing the math. To the point where they offer recommendations or even act as spokespeople for your company in the future. Always keep in mind the significant benefit of utilizing partnerships.
Human Resources: This refers to your team's history of success when they join. No matter what, only hire A-listers. In the most important positions of your business, you should only hire professionals. In other roles, seek out exceptional people whose skills you can shape according to your vision, and switch them up as needed to suit the demands of the business.
Furthermore, assemble an outstanding group of individuals to serve as directors or advisors. You will not have to pay a board of directors to lend you a hand, but a board of advisors will offer their services for free. Finding influential people in your sector who will buy into your product first and then spread the word to their large networks is crucial.
Working Capital: Put as little money as possible into this area since it does not improve the product or the firm. You can end up with a longer time to market if you tie up cash instead of using loans. If your competitors are trying to beat you to market, this scheduling error could have disastrous consequences.
Bricks and mortar do not bring in customers, therefore do not put too much money into physical capital. Indeed, a watertight roof and windows are essential (I have dealt with numerous companies in former mills where the arrangement of workstations was dictated by drips and leaks). Being frugal is not necessary. In addition, you must provide the tools, resources, and amenities that will enable your team to perform at a high level. Efficiency in terms of cost should also be considered.
Realize that you can not control every aspect of your company's investments, but you can control the value equation. You want to win business with every sale, so make sure the value to your firm is great.
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