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How Much Do You Re-Invest Back Into Your Business?

by KateD
5 replies
Hi....

After evaulating my income and expenses from November, I realized that I wasn't re-investing my profits back into my IM activities as much as I should be (about 10%).

It would seem commensense that the greater the percentage that's re-invested, the faster you can grow your business (and make more money! ).

How about you? How much of your profits do you re-invest back into your IM businesses?

KateD
#back #business #reinvest
  • Profile picture of the author dvduval
    I think this can vary widely from one business to another. For example, a very large business may only need to make $1 per customer, while a small business with few customers needs to make a lot more.

    The big question is what percent are you taking in profits versus the percent you are reinvesting. If you are taking more than 50% in profits, I would say this is probably an unhealthy situation that will not last (though I'm sure there are a few people that maintained a level like this, but those are uncommon). I think for a small to medium sized company 30% is a reasonable goal for profits.

    However, if you are a new company, it is more likely that you will have to take less profits in the first year or two.
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  • Profile picture of the author lakshaybehl
    You ask a very good question...

    And you have yourself provided the big enough reason why someone would want to reinvest their earned money back into the biz...

    I currently re-invest nearly 40-50% of my income, and thatprobably is the reason behind the rate of my growth which is ginormous.

    How much do others do?

    -Lakshay
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    • Profile picture of the author KateD
      Originally Posted by lakshaybehl View Post

      You ask a very good question...

      And you have yourself provided the big enough reason why someone would want to reinvest their earned money back into the biz...

      I currently re-invest nearly 40-50% of my income, and thatprobably is the reason behind the rate of my growth which is ginormous.

      How much do others do?

      -Lakshay
      Ginormous. I LOVE that word.

      Yes, internet marketing makes it very easy to quickly grow by re-investing your profits. I have been dipping into my profits to pay for things like bills, food, misc. expenses.

      If I could discipline myself to re-invest 50% of my profits, I would be doing pretty well in a few months (theoretically anyway).

      KateD
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  • Profile picture of the author TheRichJerksNet
    Money wise - This can vary depending upon what I am working on ... Some things I have invested 1/3 back in to create like a v2 or a better product.

    As a good base I have always explained to my clients between 15% - 50% and again depends upon the website they are running and the type of service they are offering..

    As far as investing time .. I think we all invest a great deal of time into our busines..lol

    James
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  • Profile picture of the author ejfern22
    In the beginning I would reinvest most of my money after paying for my expenses. But once I started making larger profits per month then I reinvested only about 50%-75% of my money. I think half of what you make should be a fine reinvestment for your business.
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