If you want to grow your business, you’re going to have to identify a few problems first of all. Mainly, what could hold you back from achieving your goals across the next year, thanks to just how unsustainable these practices can be.
Read MoreYour business can be destroyed in numerous ways, and some of them are pretty easy traps to fall into. Others can also take a long time to fix when they happen, and a lot of remedial work is required. However, most begin and end with company culture, ethics, and understanding of the industry.
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Making the decision to leave a stable position of employment and set up your own business is an exciting time for any would-be entrepreneur. Becoming self-employed gives you a huge amount of freedom: you can work to your own rules and working practices and organize exactly when and for whom you work. On top of all this, you can dedicate yourself to a business that you are truly passionate about and are consequently willing to put in 100% to make sure that you are successful. However, setting up your own business can also become exceedingly stressful and could prove to be a disaster if not thoroughly planned. Considering these points, read on for a short guide to setting up your own business.
1. Education
You might have all the necessary expertise needed to create and carry out the products and services your business will offer, but product knowledge alone is not enough to ensure that your endeavor is successful. You will need a strong foundation of business practice knowledge that you can take into your own business practices. If you do not come from a business background, you could consider taking some online business courses. These online business courses will provide you with the essential skills required in areas that are much used when setting up a business, for example, bookkeeping, grant writing, and project management.
2. Write a business plan
Writing a business plan is an essential task that should be undertaken when setting up any business and reviewed and updated every couple of years to reflect your current circumstances. There are plenty of guides available showing you how to write an effective business plan, but there are several points that you should always look to include. An analysis of the market which you are entering, for example, along with a detailed description of your business’s unique selling point, to clearly demonstrate how you will fit into that market.
3. Secure financing
Setting up your own business is an undeniably expensive endeavor, and as such, you will need to make sure that you have secured financial backing. There are several federal loans you can apply for, such as the Small Business Administration Loan, to help you to set up your business. Alternatively, you could approach a bank for a loan, but make sure that you are able to pay your loan off and do not put your house as collateral, in order to prevent a disaster from occurring if your business does not prove to be successful.
4. Premises
During the early days of your business, when you are just starting to get off the ground, you might decide to work from your own home in order to reduce overheads from expensive rented offices. However, you might require some extra space in order to house supplies and products for shipping. If this is the case, you could consider renting a storage space from which you can store and package items away from your home.
By: Marissa Perez
Whether your small business is just getting off the ground, thriving, or in a slump, one of your biggest concerns is keeping it relevant to stack up against the competition. Doing so prevents you from getting lost in a sea of similar products and services. So, how can you set your small business apart and compete with the big dogs?
Provide Amazing Customer Service
You may be a small business, but your smaller size means you are better able to build and maintain meaningful relationships with your customers and improve customer retention. So, don’t let your customer service be an area that’s sorely lacking. Set some customer experience goals and make all employees aware of those benchmarks. Speaking of employees, make sure those you hire are emotionally intelligent and provide training to help foster any shortfalls. You’ll also want to equip your employees and business with the right tools to create a seamless customer experience via help desk software and live chat features.
Consider a Brick-and-Mortar Space
It seems that e-commerce is where it’s at, but don’t think that physical space is a waste of time. According to Business.com, 94 percent of sales happen in a physical store. The reason why? Well, it varies, but the most common reason is the ability to see and interact with a product before making a commitment. Plus, the customer service we discussed earlier is easier when consumers can see a smiling face rather than text on a computer screen. You’re a small business, so the cost of setting up shop — literally — may be setting off alarms. Thankfully, the Small Business Administration (SBA) is here to save the day by offering real estate loans. You have two options: the SBA 7(a) loan and the SBA CDC/504 loan, but the latter is the most common for small businesses like yourself. Do your homework to find the right option and rate for you.
Take Advantage of Your Ability to Innovate
Small businesses can change direction on a dime, pushing out a new product or using a new supply source. This ability to switch focus easily is what sets you apart from those larger companies and competitors. If you’ve been toying with the idea of altering your current product or providing a new product altogether, start developing and testing right away. Survey current customers and gather ideas from them. Perhaps you’re thinking about switching up your supply source to better meet customer demands. If that’s the case, dropshipping might be something to look into. In this scenario, you are removed as the middleman, and the supplier ships the products directly to your customers, lowering your risk, reducing overhead, and no more paying for inventory until a customer makes a purchase. There are lots of products that can be sold via dropshipping — kids' clothes, shoes, electronics, gadgets, and even trendy items like fidget spinners, for example — so take a look online and see if you could benefit.
Increase Your Efficiency
Large businesses have the luxury of huge departments, each dedicated to a certain task or service. You’re small, so having all hands on deck to increase efficiency doesn’t leave you with many (if any) hands left to handle other areas. Find ways to automate, whether it’s hosting meetings remotely via video conferencing, automating invoicing, or using accounting software. There aren’t enough hours in the day to do everything and be everywhere at once, so hand the torch off so you can focus on the areas and tasks that need your immediate attention.
Build Your Reputation
Big businesses have a big reputation, but big doesn’t necessarily mean better. Your small business is in a unique position to capture the locals’ attention and become a welcome part of the business community. Tap into the community (and build your reputation) by hosting events so people can get to know you and vice versa. Stay active and be a visual presence by volunteering or hosting a charity event. Connect with other businesses and help one another to create a lasting impression and framework for success. Keep in mind too that with the holidays coming up, you have a great opportunity to draw in new customers, so look for ways to offer deals and seasonal events, and don’t forget to decorate!
Sure, being a small business comes with challenges, but large businesses have their own unique challenges too. What sets you apart is how you overcome those challenges so that you are competing right along with the big dogs.
No risk, no reward as they say. In all businesses, there will always be an element of risk. Small business owners and serial entrepreneurs can take this reality for what it is and still be outgoing and innovative.
However, you can limit their risk by taking greater control of your business’ structure.
First off, you need to decide whether you want your personal and professional finances to merge together (please note, we’re not experts on this topic so please ask your accountant for advice). Then consider the risk of the market you’re in (i.e., are you in a high-volatility prone industry such as short-term financials?)
Other risks are going to include your employees in some way (your HR department will keep you updated regarding employment laws). There are so many areas in which you are at risk in one way or another, so mitigating as much inherent risk as possible should be your first priority.
Living behind a barrier
As you may well know, around 70-80 percent of small businesses end up failing in the first five years of their existence. Many times, you see the owners filing for bankruptcy and having their personal lives changed forever. But this is most likely because they chose to go with a sole proprietorship or perhaps they were in a general partnership. They didn’t have a barrier like an LLC to protect them.
If you’re asking ‘what is an llc?’, put simply it's a business type that separates your personal finances from your business's finances. If you were to create one, the money would come out of the business, not from your personal bank account. In other words, you and your business are two different non-linked entities. This type of business structure gives you different tax benefits as only your profits from the business are taxed. So your salary might be 10 percent of the business profits but that's the percentage that is taxed.
Investigate your own weakness
Focusing on sales, profits, and brand marketing are probably the only things you want to worry about daily. But you don’t know where future risk could come from and it might be from within your business. Business administrators are like an internal affairs department because they investigate weaknesses inside the company.
An internal control admin objectively looks at your processes, systems, and your future development needs and points out where improvements should be made and what areas are the most risky. It could be something like old software which isn’t allowing your services to grow in capability or it could even be a partnership that is going south.
Keep accurate records
Operations in your business will become standardized once you get used to them. Processes will be streamlined and you’ll soon have a spring in your step as you develop standard practices.
To reduce the risk of abnormal performance, keep accurate records of revenue, sales, growth, and specifics such as time spent on a task or how much money you spent on materials.
Risk is everywhere in business, but don’t let it negatively impact your confidence. By making sure your personal and business finances are not linked, you don’t risk the chance of going bankrupt.
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