How to Reinvest Your Business Profits For Maximum Value

First Paycheck

It took me almost two years before I got my first client. Why did it take me two years? Because I was treating my business like a hobby and I was not serious in growing it. My client gave me $200 and immediately I invested it into a weave. Yes, I went to my hairdresser and installed a weave in my hair. This itchy, expensive weave that did not help my business nor self-esteem. Do not be the old Denise. Be smarter with your business profits. Learn how to reinvest your business profits for maximum value.


The hair cost $100 and the cost to install this gerbil was $200. And I got a 0 return in investment for it.

Most business owners who start off with their business as a side hustle do similar crimes. They use the business profits and buy clothes, theater tickets or other useless trinkets they will forget about in a few years. This is a terrible idea. You need to outline all of the things your business will need to become successful. You will have plenty of time later to splurge on personal items.

Outline Your Business Priorities

Your business plan should include a section on how you want to grow and develop your business, which includes how to reinvest your business profits. If you have not created a business plan, do not stress out - I have created a simple business plan which will help you strategize your business.

The most important thing you should ask yourself is, "what does my business need RIGHT now." Similar to my article Urgent or Important I distinguished the urgent from important.

Not Important and Not Urgent Urgent but Not Important
Urgent and Important Not Urgent but Important

This concept also applies to your business strategizing. If you do not have certain things prioritized, you may have to close your business. I recommend you make a list of all the important items your business needs now and will need in the future.

Make that Money Work for You

We want to make sure your money can make the most impact for your business. Here is my business reinvestment policy:

Take 100% of your profits and reinvest it back into your business.

Yes, you read that. Do not be like me and invest into a weave.

Take every single dime of your profits and put it back into your business.

The sacrifice is well worth it. If you are serious about growing your business, you need your money working hard for you. Now that we have that cleared up, let's talk about where to use that money. We will talk about things you should invest in right now to help you lay a good foundation as your business grows.


Your Business Buy List

Below is a list of things your business will need as it grows. It is not an exhaustive list but it will help lay a good foundation. Some of these items are free or low cost.

  1. Invest in a Business Coach. A business coach should be number one on your list. Your coach will help you avoid the pitfalls and help you from making poor business decisions.
  2. Website. Get yourself a website, it does not matter it is from Weebly, Bluehost, GoDaddy or Square Space. Find a provider and pay for a website. My first website cost me $150 and it was a simple WordPress website. Remember, people want to learn more about you before they pick up a phone or send you an email address. Your website should be clearly organized and explain these elements: what you do, how you do it, who you serve and how they should contact you.
  3. Professional Email Address. Say goodbye to your or address and get a real email address. If you want people to take you seriously, this little bit of money is worth the investment. If you already have a business website, you should already have one. If you do not, you can obtain an email address from GoDaddy for as little as $2/month.
  4. Customer Relations Manager (CRM). Many companies like Hubspot and Salesforce offer FREE CRMs. Take a moment and set one up now! As your business grows, so will your list of contacts. Make sure you have a good contact list built before your business gets more successful. This will be helpful because as your customer list grows you can segment them by audience and create offers that will cater to their needs.
  5. Email Marketing Service. As your contact list grows you will need to stay in contact with them! Remember I mentioned that Hubspot and Salesforce offer free CRM? They did not offer it out of the goodness of their hearts, they know you will need someone to send out email message to track click and open rates. If you do not want to use them you can also use Constant Contact, Awber or Mailchimp. These companies will also help create landing or splash pages to generate new leads.
  6. Get an Online Scheduler. Avoid the email back and forth with contacts. Get an online calendar so you can schedule meetings with people. I use Calendy but there are other service providers like Acuity.
  7. Lawyer. You may not think you need a lawyer now but I promise you will need one in the future. Legal Shield can offer you legal protection for as little as $25/month.
  8. Make your Business a LLC. Shield yourself from liability and deduct your expenses using a LLC.
  9. Virtual Assistant (VA). Your VA will be your second eye to help manage your business. They can help you from everything from writing email messages, copywriting, email marketing, ad creation or graphics. Contact me and I will send you a list of VAs that I recommend.
  10. Advertising. It does not matter if it is online or in print, devote at least 20% of your profits towards this. Do not rely on referrals alone to help create new business.
  11. Marketing. People intermingle this with marketing. Marketing is a separate investment from adverting. Marketing costs include the research of your ideal customer (where they are, interests and spending habits). This includes money towards surveys or participating in focus groups studies. Make sure at least 1-5% goes toward this costs.
  12. Bookkeeper. Do not lose track of your money. Manage your books using Quickbooks or hire a bookkeeper, this will help you to make sure every penny you make is accounted for.
  13. Electronic Organization System. Whether you choose to use Google Drive or Evernote, find a system that will help you organize all of your files in a cloud network. I personally had too many computer issues to realize that keeping my files local was a bad idea.

There will be many other investments you will need but the items above will help you stay organized and efficient. You and your business coach will help you nail down on investments that make the most sense for your stage in business.

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