If you’re like many women I know, you may be cautious when it comes to money. Call it “Bag Lady Syndrome”—that irrational fear that lots of us have that, somehow, we’re going to end up penniless (no matter how hefty our bank accounts currently are), but the attitude invariably carries over to our businesses.
In today’s economy, of course, a frugal approach to business might seem like a necessity. And to some degree, that’s true.
But there comes a point when being frugal really means you’re being penny-wise and pound-foolish—and for many women business owners, it’s hard to tell when you’ve crossed that line.
Consider the case of Andrea Herrera, who was recently profiled on CNNMoney.com. Herrerra suffered from an affliction common among women entrepreneurs: fear of debt. She had grown her 10-year-old catering company to $650,000 in sales, but her reluctance to take out a loan was hindering further growth.
A mentoring organization finally convinced Herrera it was time to bite the bullet. Three years after she obtained a loan, her company projects sales of $1.3 million, and boasts big clients including Oprah Winfrey’s Harpo Productions. With new employees handling duties she used to juggle, Herrara has time for long-range planning so her business can grow even more.
Overcoming your fear of debt doesn’t have to mean taking out a loan, of course. There are many examples where reluctance to spend on a smaller scale could be holding you back. Are you working with outdated equipment? Doing tasks an assistant should be handling? Cutting out conferences where you could meet lucrative clients because you don’t want to spend the airfare or pay for a hotel? Even sitting on an uncomfortable desk chair because you don’t want to spring for an ergonomic one can cut into your productivity.
Next time you’re considering an investment in your business, consider this: How long would it take to pay back the expenditure? If a $200 chair makes you 20 percent more productive, it might pay for itself in an hour. If you land just one client at that event, the cost could be covered—and then some. In other words, start thinking about expenses not just as liabilities, but as opportunities that could help grow your business.
Sometimes it takes someone else’s perspective to help us see the growth opportunities in our businesses. Want to talk to someone? You can get advice anytime at SCORE.