For years I've been hearing the phrase "invest in your business." Mostly it's used to sell stuff. All kinds of stuff. Some of those investments are things small businessmen actually need: new equipment, technology upgrades and fuel-efficient vehicles. But some stuff touted as a "business investment" is entirely useless in business.
For example, years ago I bought a somewhat expensive suit. As I was trying it on, the salesman called it an investment, which made me wonder if money appeared in the jacket pocket on a regular basis like compounded interest. Was it a magic suit?
In truth, it wasn't an investment -- it was a piece of clothing that I enjoyed, fit well and lasted a reasonably long time.
The salesman, of course, was calling it an investment to ease the sting associated with the hefty price. I'd put luxury vehicles dressed up like work trucks and fancy-pants personal electronics into that same category. Calling such things investments is actually more of a justification than fact. An investment has a cash return.
Why do the investments business owners make in their companies have to cost a lot? After all, the best investments, whether in real estate or the stock market, are those that are acquired cheaply and sold for significant profit. Are there undervalued investments out there for bulk vending operators? The answer, of course, is yes. And, I've made a list of them.
Education: It's still the best investment a small business owner can make in his company. Community colleges remain a bargain for such studies as accounting, computer graphics and business management. And the Small Business Administration offers free courses and programs to small business owners.
Employees: It continues to astound me that many businesses, large and small, continue to view personnel very much as necessary evils. Well, salaries are expensive, that's a fact. It's also a fact that many small companies don't make the most of the potential value employees can add to the company. They don't invest in educational opportunities that directly relate to employees' jobs, or cross-train employees in different jobs within the company. I've seen companies that upgrade and expand equipment on a regular basis to remain competitive, while their employees do the same jobs, year after year, in the exact same way.
Product Trials: In an effort to maximize location profits, many bulk vendors have been playing it safe. It is not uncommon these days to go into three different supermarkets, serviced by three different bulk vending operators, and see nearly the exact same product mixes in each one. Testing new products and mixes in a few bulk heads is primarily an investment of time and effort.
Marketing: With the computer technology currently in place in most small businesses, there's no reason why bulk operators shouldn't be aggressively marketing their companies through flyers, online efforts and presentations aimed at location management. These investments require little more than time and effort, but can pay off handsomely in the long run.
The common denominator to my list of investments is that they require something of an extended time horizon. Cross-training employees, for instance, will very likely not produce an immediate payoff. The ROI may take years. So, are these bargain investments worth the time and effort? That depends on how long the operator plans to stay in business. by Hank Schlesinger