“Bahala na,” which translates to “Come what may,” is a popular expression among Filipinos that can be associated with spontaneous decisions. This mindset is the opposite of saving for rainy days, and it can lead to financial insecurity in the future.
The “bahala na” attitude is a natural foe for a small business owner. For your company to thrive, you must think and plan about strategic cost management, among many other things, to achieve financial stability and steady growth.
Investing is one of the many ways to secure a positive momentum and upward trend in your operations. Entrepreneurs who invest grow their businesses, save for emergencies and plan for the future. No matter the type, each investment comes with financial risks and rewards, so it’s critical to take precautions and strategize before making a move.
Read on and let this article guide you in choosing the right investment for your business and understanding the key factors to consider when investing.
6 Investment Ideas for Small Businesses in the Philippines
Investing allows your company to flourish while creating a financial safety cushion to protect it during difficult times. Check out these six smart investment ideas your small business can look into to improve your overall brand and processes:
1. Disaster recovery plan
The COVID-19 pandemic has severely disrupted global markets, forcing businesses across all industries to seek novel solutions to remain competitive. This global crisis has taught us that a backup plan should be in place to ensure solid business continuity.
Nobody wants to think about a disaster or other emergencies affecting their business. However, investing in a strong and foolproof disaster recovery plan will come in handy if something ever goes wrong, whether caused by internal or external factors. This scheme can help your business return to normal operations quickly and with minimal interruption.
2. Digital marketing
According to Manila Times, the Philippines is the second heaviest internet user in the world, with 36.7% using social media for work-related research and activities.
In the age internet, small businesses must invest in digital marketing assets that will generate revenue for them in the long run. Knowing your target market and creating a strong digital presence is necessary to promote your company effectively.
Whether online advertising, social media, email marketing, or other digital marketing initiatives, this makes a worthwhile business investment as it gives you a wider reach to your target market and an overall competitive edge in your industry.
3. Product development
There’s always room for improvement when it comes to running a business. Customer demands are ever-changing, so regularly developing your products can bring a lot of wins for your brand. After all, it would be best if you stood out from your competitors to generate more sales.
Begin by examining and expanding on your company’s best-selling products. It’ll help you understand your customers’ needs and preferences and find a way to meet them. It may require a lot of collaboration and initial investments, but the results are worth it when done right.
Small business owners should also invest in robust cybersecurity for their companies, regardless of their line of work. In a Kaspersky Security Network (KSN) report, the Philippines ranked fourth in web threats in 2021, including web attacks, remote desktop protocol (RDP) attacks, and mobile malware.
Although cybersecurity services and software can be expensive upfront, they cost less than a breach’s cost. A small investment in better online and data security can help boost your business’s growth and your customers’ trust in your brand.
5. Reskilling and upskilling
Business owners should invest in their employees to ensure they have the skills necessary to achieve the company’s goals and attain more success in the future. Training and capacity building help employees improve their expertise and streamline business processes for a more effective and efficient daily workflow.
Of course, you should also invest in yourself! You can take classes or certification programs related to your industry to strategize and operate your business more efficiently.
6. Finance team
As your company grows, so will your finances. Employing professionals to handle your accounting, bookkeeping, and other finance functions is critical to ensuring accurate and timely output when balancing your business’s books.
Plus, taxation in the Philippines can be complex, given all the documents and deadlines mandated by BIR for strict compliance. These regulations also vary depending on your business’s industry, size, and location.
This is why having a robust finance team with reliable systems and processes is an essential investment. Sort this integral part of managing a business and outsource accounting services.
Key Things to Consider Before Making an Investment
Before making any investment, the most crucial step for any business owner is to educate themselves. The following discusses factors you should account for before making an investment decision.
Know your current financial state
The first step in deciding about investments is to assess your current financial situation. Before looking into investment opportunities, you should understand your business’s revenue, debts, assets, and expenses well. It’ll give you a better idea of how much money you can afford to invest.
Set your investment goals
What do you hope to achieve in the next five years? Once you have a clear idea of your goals, you can start looking for investments to help you achieve them.
Changing your investment strategy because some are underperforming can be tempting, but if your goal is long-term, making decisions based on short-term market fluctuations may significantly impact what you set out to achieve.
Diversify your investments
Putting all your money into a single venture can be disastrous, especially when market trends become unpredictable. It’s strategic to diversify your investments to expand your risks as well. Other assets may help to level the playing field if one of your investments underperforms.
To make informed decisions, it’s also critical to research what factors may impact your investments.
Avoid circumstances that can lead to fraud
Scammers frequently use widely publicized news headlines to entice potential investors and make their “opportunity” appear more legitimate.
Before investing, the Securities and Exchange Commission (SEC) recommends that you ask questions and verify the information with an unbiased source. Seeking professional assistance from bookkeeping and finance services to cybersecurity solutions can alleviate your concerns about fraudulent transactions.
Invest with Confidence
Investing can give you power. Having savings and investments grants your business more flexibility, especially in times of crisis. It’s a way to prepare for emergencies while also improving your company’s overall performance in the long run.
Investing entails a complex process that can be challenging to accomplish independently. If you want to start investing in your finance team, you can partner with CloudCfo!
CloudCfo is a cloud accounting company in the Philippines that specializes in helping startups and small businesses with their cloud accounting, bookkeeping, and tax functions. Check out our process to know how you can scale your finance functions today, or contact us to learn more!