7 Strategies for Small Business that can Help You to Break Even in 6 Months


While it doesn’t sound as appealing as “making a profit”, breaking even is among the first milestones that a small business should achieve in order to manage its cash flow and gain profit in the near future. Companies that manage to break even in the shortest possible time possible are among those that tend to survive in the long run and have more chances of growing and scaling up their business.

Starting a business is easy. But running it is another story. It’s only after you surpass the break-even point can you really sigh in relief and be more confident that your business is doing well.

So how do you break even in the shortest possible time, preferably within 6 months after you launched your business? Here are some effective strategies you should try.

Improve your business process.
Once you launch your business, it may feel easy to keep things on track especially when you have a well-designed business plan. However, the reality is far different than what you expect sometimes. It takes some time for business owners to establish a workflow that works for them best. By the word ‘workflow’, we refer to the systems and processes that let you conduct day-to-day activities in the most efficient, cost-saving manner. Investing in equipment, knowledge and technology is a great way to improve your business process.

Learn how to cut costs.
Every cent counts. Learning how to manage your expenses is critical to maximize your earnings. There are many ways to cut costs. For example, consider finding an office space that is not that expensive, reducing staffing especially during low season, minimizing transportation costs, and finding ways to reduce waste. Cutting your advertising costs can greatly help too. For instance, you can leverage online marketing tools, such as the social media, which are proven to be highly effective but are not as expensive as traditional advertising strategies like print and TV ads. Short-term financing options like SBA and personal loans online to cover the costs of this marketing approach.

Set monthly goals and exceed them.
Goal-setting is crucial to any business. Every small business, at every stage, needs goals in order to move forward, get motivated to accomplish more, and succeed. Companies employ different goal-setting processes but the key is to set realistic short-term goals and achieve them. It doesn’t have to be a long and complicated process. Start by identifying the necessary action items, based on your break-even analysis, and commit to the process. Goals should be SMART – specific, measurable, attainable, realistic and time-bound.

Invest in your sales point and your customers.
If you want to earn more and earn fast, you should focus on increasing your sales. But in order to do this, you have to invest in providing the best possible customer experience. Every start-up faces the major challenge of getting customers. With the ever-stiff competition in the market, finding customers who will make purchases over and over again is not easy. Thus, you have to leverage all your resources to attract new customers and ensure that those who have tried your products or services will come back.

Employ beachhead strategy.
Many well-established businesses swear by the power of employing beachhead strategies. The term comes from military language, which means to “invade enemy territory”. It involves focusing your strength in winning a small border area, which then advances into a bigger territory. In the world of business, it means focusing on one key area first, such as a smaller market segment, possibly dominating that market before moving into larger markets.

Fortify your business concept.
Work on proving that your product or service is something that customers will willingly pay for. This is a tough job because it often involves research, product development, and market analysis. But it’s all worth the investment once people start noticing and appreciating what you have to offer.

Upsell and cross-sell.
These two have obvious benefits to any business – more revenues. But what’s the difference between the two? When you upsell, you encourage customers to purchase anything that could increase the cost of your product. When you cross-sell, you encourage them to purchase anything in conjunction with the primary product. For example, upselling a shampoo product could mean asking the customer to buy a personalized canister while cross-selling is inviting them to buy a conditioner that works best with the shampoo. Both these approaches help increase your sales.

Starting a small business is a big risk. You’ll never know if it’s going to work or how long it will last. There is also no way of determining how long it will take you to reach profitability after opening your business. However, by employing these strategies, you can greatly improve your chances of breaking even as soon as possible, and hopefully, go beyond that point and start earning money.

Author’s Bio
Lidia Staron has been working as a writer, editor and literary coach for 5 years. She contributes articles about the role of finance in the strategic-planning and decision-making process. You can find really professional insights in her writings.