Once an SME has experienced a certain level of growth and success, it can start to focus on expanding with its extra income into other investments. As an SME owner it will be down to you to choose what investment options your business pursues. They could be to improve your workforce and benefits they receive, take the business in a new direction or to build extra profits. These are some interesting investment opportunities that your SME could consider.
Investing in another SME or start-up is one option to potentially grow your current firm. This could be through joining with a competitor or taking on board an SME from another sector to diversify and spread out risk. A lot will depend on how much money is required to arrange a takeover or partnership, along with all the small details of making sure everyone’s best interests are met. There are a range of legal aspects that will need to be adhered to when setting up a business partnership to make the investment a success.
Self-invested personal pensions (SIPPs) can be a good investment choice for SME owners, as they hand over control of your retirement investments back to you. This does introduce a bit more risk but can also provide excellent opportunities to boost your pension savings. You could even consider rolling out SIPPs for your entire SME, with providers such as Bestinvest offering these accounts.
Another option is to invest in emerging companies or technologies, as any individual investor might do. Technology continues to evolve, and this is one industry that may be worth pumping any spare funds you have into in the future. Virtual and augmented reality revenues are predicted to reach more than £130 billion by 2020, as the sector grows and offers exciting opportunities. It is essential to seek the advice of investment professionals first, who can help you approach any such opportunity in the best way.
Business Savings Accounts
A sensible choice for any SME is to simply invest any excess profits in a business savings account. This should safeguard the funds in case of any issues with your company, while seeing them grow thanks to interest. The risk/reward ratio may be lower than other options presented here but it can be a much safer choice when it’s your SME’s funds at play.
You could potentially boost your SME and its finances by making its money work with any of these investment options.