It’s exciting when your small business starts to turn over a profit. Not only are you doing well, but you’ve now got money left over. You can pay for all your expenses, from employees to supplies, and still have more income to consider. The big question is: what should you do with your profits? You’ve made an amount significant enough to consider investing it to turn it into more profits. However, deciding just how to invest it isn’t easy. It’s not the same as investing as an individual because your business is at stake. Try considering these top investments for your small business’s profits.
Back into the Company
The first thing you should think about doing is plowing the money back into your company. If you’re trying to build the business, you should think about ways you can grow. There are several areas where your business could benefit. For example, have you thought about investing in your employees? You can offer training to help them develop their skills. Or perhaps you can buy new desk chairs or furnish a new break room. You might also consider putting money toward new equipment or increasing your stock. There are lots of ways you could improve your business.
Investing in Stocks and Bonds
You might consider investing the money in stocks and bonds. This is something you could do if you want to make some long-term investments. You won’t see the benefits right away, but you could grow your profits over time. You can find tips for investing all over the internet, on sites such as The Fortunate Investor. You can also read books, listen to podcasts and high advisors to help you. If you want to invest in stocks or bonds, you should make sure you do your research. You need to know where your money is going before you start. Also, make sure you want your business associated with the companies you choose.
Expand Your Business Portfolio
If you have built a significant amount in profits, you might look at other options. One thing you could do is consider buying another business. Perhaps by now you are largely hands-off with your existing small business. You can delegate the majority of tasks, and you think you have time to give your attention to another business. If you want to do this, you have to make sure you do a lot of research. You need to ensure that a business will be profitable for you before you decide to purchase it.
Buy Real Estate
Real estate is an excellent private investment and can be terrific for your business too. You might choose to buy an office or building for your business to move into. On the other hand, you could buy commercial or residential property to rent or sell to others. Real estate can be profitable if you know what you’re doing. Be careful not to go into it lightly if you want to have success.
You can choose to invest your business profits in a variety of ways. Find the methods you think will work for you and make your choice.
Facebook has reported a sharp drop in profits, partly due to increased spending on research and development.
Facebook made a profit of $64 million in the final three months of 2012, compared with $302 million a year earlier.
Revenue was up 40% at $1.6 billion, largely due to a big jump in advertising revenue, a quarter of which came from mobile platforms.
Shares in Facebook fell by almost 6% in after-hours trading in New York.
The shares launched on the Nasdaq stock exchange in May at $38, and had halved in value by September.
They have since recovered to stand at $31 at the close of trading on Wednesday. The drop in after-hours trading suggests the shares will fall back again when full trading resumes on Thursday.
“Mobile revenue was expected to be a little higher,” said analyst Aaron Kessler at Raymond James.
“Overall it’s a solid quarter but maybe [the company has suffered from] high expectations going into the quarter.”
Facebook has reported a sharp drop in profits, partly due to increased spending on research and development
Revenue from advertising was $1.3 billion, 41% up on a year earlier.
Mobile revenue, an important indicator of the company’s ability to capitalize on the growing move towards mobile platforms, accounted for 23% of overall revenue.
“In 2012, we connected over a billion people and became a mobile company,” said Mark Zuckerberg, Facebook founder and chief executive.
“We enter 2013 with good momentum and will continue to invest to achieve our mission and become a stronger, more valuable company.”
Facebook shares have fallen to a new low, as concerns about its mobile strategy sparked a sell-off when markets opened on Friday.
Late Thursday, in its first report as a public company, Facebook said it lost $157 million from April to June.
Its shares plunged more than 16% to $22.37 when trading began in New York on Friday, worse than the declines seen in after-hours trade on Thursday.
Facebook shares have fallen to a new low, as concerns about its mobile strategy sparked a sell-off
Facebook shares were priced at $38 when it listed on the NASDAQ in May.
Facebook’s results on Thursday showed that revenue in the second quarter of the year had grown 32% to $1.18 billion, just beating forecasts. But analysts at Piper Jaffray said it appeared investors wanted “more than a slight beat”.
The number of monthly active users (MAUs) rose 29% from the same period last year to 955 million, but some analysts question the reliability of this data given the number of fake profiles on the social network.
The number of people who logged in daily to Facebook’s site from their mobile devices surged 67% year-on-year to 543 million.
But the company has yet to resolve how it generates profits as users move from the computer desktop version to accessing the site via mobile phone.
“We don’t view these results as dramatically good or bad,” said Citi analyst Mark Mahaney.
“Key questions remain: the future of Facebook mobile monetization and the future of Facebook user engagement.”