9 Ways To Use Your Bounce Back Loan

The checklist of what to do (and what not do)

The government’s Bounce Back Loan means that any business in the UK can borrow up to ￡50,000, (capped at 25% of their turnover) effectively free for 12 months, with no interest payments and no capital repayments during that time.

I cannot stress enough, ONLY IF YOU QUALIFY!!!

You can get a lump sum into your bank account and after the initial 12 months, it’s repaid over a 5-year term at 2.5% interest - which is much lower than any small business would be able to borrow in a normal market.

This gives every UK qualified business the opportunity to address, what many businesses experience - being under capitalised. The business owner has to struggle and find a way to pay for everything, including driving their growth, from the revenues that are coming in this week or this month. They haven’t got the capital to invest to grow their business.

Until now. This checklist will help you make the right decisions and do the right things with the monies you get from your Bounce Back loan. As a business owner, you will be able to bounce forward you can when you have a reasonable amount of capital to make it happen.

In the past, have you ever caught yourself thinking

“If only I had ￡10,000, I could…”.

Well, now you can have ￡10,000. Or ￡20 000 or ￡50 000, completely free for 12 months.

For many businesses, used wisely, your Bounce Back Loan could (SHOULD!) be used to create additional income which, in many cases, would enable you to pay it all back in full before the monthly repayments even start. And that is what I said I was going to do with mine.

Before we get into the checklist and how you make that happen, it’s important to understand the difference between ‘good’ debt and ‘bad’ debt…

Good Debt v Bad Debt

There are many people who despise the thought of any debt. But business debt and consumer debt are very, very different. Just listen to Martin Lewis from Moneyexpert.com

Borrowing money to buy a depreciating asset like a car or a hot tub, is ‘bad’ debt. It puts a drain on your finances for the medium term and it takes money OUT of your pocket.

However, borrowing money to acquire income-producing assets is ‘good’ debt. Because those income-producing assets put money IN to your pocket.

This is the important first principle when it comes to investing your Bounce Forward loan:

• Invest it in things that will put money IN to your bank account.
• Invest it in things that will help you to grow.
• Invest it in things that will get you more customers and more sales.

Because when you do that it’s ‘good’ debt.

You’re using Other Peoples’ Money to grow your business and make more profit.

Almost every successful business in history has used Other Peoples’ Money at some point to catapult itself forward. They’ve taken on debt, or raised capital from shareholders, to invest in income-producing assets.

Your Bounce Back Loan is your chance to do the same and I would urge you not to waste your Bounce Back loan on acquiring goods and services that take money out of your bank account.

Use your new ‘capital’ to acquire assets that put money IN to your bank account.

Those assets could be physical things like new kit or equipment that enables you to expand or grow your capacity, say. (That expanded capacity puts money IN to your bank account – so ‘good’ debt)

Or they could be intangible things like marketing campaigns or marketing systems, say, that help you crack the Rhythmic Acquisition of Customers. (Effective marketing systems bring in new customers consistently and predictably that put money IN to your bank account – so ‘good’ debt).

So now we’re clear that this is an amazing, unique opportunity, let's dive into the Checklist to help ensure that you invest your Bounce Forward Loan wisely…

1. Once in a lifetime opportunity.

Do not treat this like any kind of normal situation. This is your chance to have up to ￡50,000 of capital to invest in your business, completely FREE for a year.

Do not throw away this opportunity.

Any entrepreneur worth his or her salt, can invest ￡50k so that it returns ￡60k, or ￡90k, or ￡150k, or even ￡500k IF you use it wisely. So think very, very carefully about how you’re going to invest it to get the maximum value from it.

You don’t have to spend it all at once. It’s free money, don’t forget, so it can sit in your bank account until you’ve worked out how to deploy it wisely so it generates the best possible return for you.

2. Get clear on where you want to be.

This is not some theoretical or rhetorical question.

Please, please, please give real thought as to what you want your business to look like one or two years from now – because then you can use your Bounce Back Loan to help you get there.

Before you invest any of your Bounce Back capital you need a clear answer to the following 4 questions:

? How much will your personal drawings from the business be each month when your business is ‘successful’? (You get to define what success means don’t forget. This is about YOU. No one else)

? What will your revenue/sales need to be in order to fund those drawings?

? How many customers will you need to be serving to generate that revenue?

? What additional resources, equipment, or staff will you need in order to service that number of customers?

These are really, really important questions, that when you understand the answers properly, it will significantly impact your ability to use your Bounce Forward loan effectively so that it moves you - often quite rapidly- towards where you want to be.

Because, for the first time, you’ve now got the capital to invest in the right things to get you to where you want to be.

3. Discover the EMSS

(The Entrepreneurs Marketing and Sales System), is the system I work through with my clients. The EMSS is a rock-solid, tried and tested, completely proven system for growing any business to the place where its owner wants it to be.

It provides a structure and a step by step plan that encompasses all aspects of growing any business. It contains many tools and templates that, when used properly can be transformational for almost any business.

The EMSS contains 11 foundation blocks. These all need to be properly in place in order for you to grow sustainably. As the name suggests, they provide the foundation for growth. Using some of your bounce forward monies to get all the foundation blocks implemented properly in your business could be a really smart thing to do.

4. Create assets and systems

It’s no fun in business when the first of the month comes around and all your scoreboards are reset to zero and you have to start again to generate this month’s income, from this month’s sales.

That’s hard.

Life is much, much, better when you have marketing systems in place that deliver you a consistent, rhythmic, predictable flow of new leads and customers arriving each month. Automatically.

So you know, at the start of the month, that your existing marketing assets will bring you the customers you need. Use your Bounce Back monies to get these assets and systems put in place. An example could be a well structured Google Ads campaign that delivers you between 25 and 30 new enquiries every week at a cost per lead of ￡9.60. The numbers will, of course, vary by business, but the principles don’t. Another asset might be a Facebook ad campaign.

Or a leaflet drop that, when delivered to 10,000 homes, generates 35 phone calls from people that want what you’re selling.

Using your newly acquired capital to put assets and systems in place is the absolute smartest thing you could do with your funds.

Spending it on a one-off, or ad hoc things, that don’t systematically put money in your bank account month after month after month, will be less than optimal and potentially, a complete waste of this once in a lifetime opportunity.

5. Get the right CRM.

Anyone looking to build a sustainable business that will pay him or her a meaningful amount of drawings each month will need a system to look after his or her customers.

That means you need a good CRM. There are lots of good choices when it comes to a CRM system and it doesn’t really matter which one you choose - but get one and get it implemented properly. Use some of your Bounce Back money to do this.

Everything that we do hangs off it and it pays back my investment many, many times over every single month. It’s not just CRM either. Get other tools that will help you to attract more customers, convert more customers, and get customers to spend more with you.

Things like a video emailing service or a reviews service say. Do the best thing – to get you where you want to be.

6. Get a red hot Follow-Up System in place.

Most businesses don’t need more leads. They just need to look after the leads they’re already getting much better in order to generate the income that they want and need.

Which means that your Follow Up System is a top contender for some of the investment from your newly acquired capital. You know that you are throwing away money that you’re currently spending to get leads because your follow up is sub-optimal.

Once someone’s enquired, you can have in place automated systems that keep in touch with them in interesting, creative, relevant, and useful ways for months and years to come. And when you do, you’ll bank the sales from those leads and prospects way down the road in the future. Without them, however, you’re always chasing the new leads today.

7. Get yourself a sales function.

This is a biggie – and for many businesses, it’s what’s stopping you from breaking through to a whole new level of sales and profit.

If at the moment, all sales have to be done by you – then it’s really hard to deliver a step-change in growth. You’re the blocker. Just ringing up everyone that’s enquired and asking how you can help them can be transformational in many businesses.

These are not cold calls.

You’re just ringing up people that have enquired (because you’ve put in place the right marketing assets and systems to generate consistent lead flow and you’ve got a CRM in place that helps you to keep track of them!).

You can either employ someone (it might only be for a couple of afternoons a week to begin with), whose job it is to come in and ring up your potential customers.

It’s almost impossible, in a properly set up business, for this not to deliver a significant return on investment.

Yet most people don’t do it because they haven’t got the capital or cash to afford it. You have now.

So think very, very carefully about this because this could be a really smart investment in your infrastructure and it relieves you of the job of following up with every single lead.

8. Liberate yourself.

Many of the things in this Checklist require work.

And you have no capacity to do more work – because every minute of your day is already counted for, right? So you’re stuck. Until you can bring in the right help.

The smart thing is to bring in people (either part-time, full-time or out-sourced) to do your EXISTING work so that you can be freed up (liberated!) to focus on the stuff that brings in the money and the growth i.e the marketing; the things in this Checklist.

Getting you freed up from the ‘day-to-day’ will be critical if you’re looking to make a step-change in profits and drawings. And using your newly acquired capital to employ others so that you can do the important stuff can be super-super-smart.

Investing in staff so that you can focus your time and energy on the things that matter most to get you to where you want to be is, when you think about it, just common sense. I’ve said for many years that,

"If you haven’t got an assistant, you are one"

That is never more true than now, as we emerge from lockdown, and you’re sat on a few thousand pounds of cash in your bank and a shed load of opportunity! Use that money to help you make more money.

Liberate yourself from all the ￡10 an hour jobs that you do – so you can focus on the big stuff. The stuff that can change your business and your life. The things that will make you more money. Bottle it and you massively inhibit your ability to make big change happen.

9. Get a Coach

These are unprecedented times and this is a unique, once in a lifetime opportunity for you.

You don’t want to mess it up. I get that.

So get yourself some proper help and support.

You don’t have to travel this path alone. Get the right coach alongside you. Working with you. Helping you to prioritise and plan. Holding you accountable to make sure you achieve the goals that matter to you.

Someone who has been there and done it. Someone who knows how to execute all the things in this list – because they’ve done it. before. Someone who will work with you one-on-one. Someone you can talk to, who’ll encourage you and support you and, when appropriate give you a kick up the backside too!

Investing a small chunk of your Bounce Forward loan to get the right top-class Coach on your team will significantly increase your chances of pulling off this genuinely life-changing opportunity.

Don’t waste it.

Let Significant Business Coaching Programme help you and your business.

Message me here on LinkedIn to book a Discovery Call

But hurry, places are limited

Adapted from an article by Nigel Botterill of the Entrepreneurs Circle, for who I am a Certified Coach