How much should you invest back in your business??

How Much to Invest in Your Business and have you created a pool for your source of 2nd Income (from Business)

2nd most important Question is - where should we invest the balance profits & create a Reserve and Surplus!!

To enhance your investment, discover how much to consider reinvesting in your small business

Reaching profitability as a small business owner is no small achievement. You likely overcame a lot of startup hurdles to get there, from finding the starting capital to figuring out what works for your market.

The question is: how much do you reinvest?

Traditionally, experts recommend that you invest at least 50% to 70% of your profits back into your company, percentage may change depending on multiple factors, including timeline, goals for growth & personal financial needs.

To understand exactly how much you should dedicate to reinvestment, start by crafting your near & long-term goals. Determine the cost of achieving these goals & how reinvesting your profits can help achieve them faster. Also, prioritize reinvestment initiatives that drive more revenue.

Keep in mind: the amount you reinvest may change year to year, depending on your business aims & immediate needs

Smart Ways to Reinvest

Some key ways that business owners reinvest their profits include:

1) Investing in people

You need more employees to help your business grow & often you need the employees before the growth occurs.

2) Improving technology.

The efficiencies & insights provided by technology can truly take your business to the next level, from customer relationship management (CRM) applications to mobile-friendly e-commerce sites. For many small businesses technology upgrades may be long overdue.

3) Ramping up sales & marketing Expanding your sales & marketing resources is a surefire way to generate more growth. Depending on your business, improving your online presence can often yield real results.

4) Acquiring new capabilities or competitors. Companies acquire other businesses for multiple reasons—to expand their capabilities, grow into a new market or even neutralize a competitor by merging together. It’s not uncommon for businesses to dedicate their reinvestment dollars to purchasing another company.

5) Invest in Mutualfunds/Equities

Small business Owners often ignore & avoid investing their funds/profits in Mutualfunds/Equities siting risk factor, but risk is also there by investing 100% profits into your own business. the better way is to spread the risk and hence one must invest 25-30% of their profits in (Mutualfunds and Equities) and get additional profits/interest/dividend and create your 2nd source of Income for business.

By doing this, it also helps to have easy liquidity, spread investment, get faster and cheaper loans (LAS) and helps in expanding the business

Reinvest in smart ways, and you'll accelerate your business growth and generate even more profit as a result.