Spare capacity can be a real killer for any business yet like heart attacks most people are blissfully unaware that there is even a problem! Nearly 80% of people who have an idea or a passion and put it into practise by opening a business work long hours and put in the hard grind yet fail! [This is a statistical FACT! ]
There are 2 distinct failure points – in the first 12 months where they are simply under-capitalised, lose the passion or fail to come to grips with the day to day reality of spinning plates, juggling balls and standing on one leg! The other is during a growth phase where supply chains and dealing with employing staff cause cash flow shortages which end up in crises if not dealt with soon enough.
One of the factors is that business owners fail to do something about the biggest hidden asset in their business – its spare capacity opportunity. Some people know their spare capacity but ignore it; because if they had the answer they would have done something about it a long time ago! Others do not even think about what it is, let alone do something about it.
What is spare capacity?
It is the ability to take on more work; more jobs; more customers; more appointments; sell more stock; sell more covers; sell more rooms; fill empty spaces – without increasing FIXED costs. Take an example – A hotel has 20 rooms, it sells them for an average of £100 a night and has a yearly occupancy of 70%. This would mean it generates an annual income of £511,000 [ a good business! ]. But what about the 6 rooms on average that remain unsold every night? In this case once tomorrow arrives the revenue opportunity disappears forever! The value of this unsold capacity is a staggering £219,000!
What would the hotel owner do with this additional revenue if some of it could be captured? Do more marketing; do some upgrade to the property; lead a nicer lifestyle; you can probably think of many things!
BBX UK [ The Bank of Spare Capacity ] work with businesses of all shapes, sizes, verticals and stages of development from pre-start up to multi-national corporations. BBX offer a free consultation with one of their growth analysts to see if your circumstances suit their solution. The BBX platform is based on a no win; no fee guarantee that states that if they do not manage to attract new customers to your business there is no fee!
In addition BBX offer interest free credit to allow you to buy things to grow your business gain a better lifestyle or sell your business for a higher amount – this also has no set repayment time frame and you pay back any loan by taking on more customers when you have spare capacity!
If any of this is of interest you should visit the BBX UK website or call Gerry or Mandy 01392 759699