When you have been through the hassle and stress of building up your own site and eventually moved it into profit, there is possibly your biggest question to come. How much, if any, profit do you reinvest back into the business, and where exactly should any reinvest go?

This is a massive question for anyone in the business world, not just online sales. You have reached the holy grail of the internet world, a profitable business, but where do you go next?

Some business will need substantial reinvest along the way to ensure they stay up with the latest fashions, the latest looks and increase their advertising exposure. On the other hand, there are some very useful sites which effectively look after themselves and will need minimum regular reinvest, but perhaps the odd revamp or advertising program (often referred to as cash cows). When do you know when to invest? And Where?

The golden rule about reinvesting into your business is the expected rate of return, and what each pound reinvested will bring to the company now and in the future. If there is no expected return, or the return is tiny, then your company may already have reached a peak whereby you may need to look at other avenues such as other legs to the business, etc.

While you do not expect each £1 of reinvested money to make a return instantly, you need to be in a position to estimate the future return, see if this is acceptable, and then arrange the necessary finance to go back in. Do not fall into the trap of reinvesting for the sake of reinvesting - some businesses are very investment intensive, needing extra capital to increase future profitability (which is fine if you can see where it is coming from), but if there is no acceptable return, don’t reinvest your profit as you will just be throwing your money away.

One good rule to remember in business, always keep some funds available to hand in case an opportunity arises or you spot a niche in the market. Do not spend all of the profits as successful businesses often attract interesting expansion opportunities!