Qualithoughts by: Peter Burton, SparQ
Originally posted at SparQtours.com
Starting and running your own business is exciting but can be equally daunting. Normally, employee #1 is responsible for everything from marketing to delivering a high-quality product. Prioritising becomes essential. Even highly skilled entrepreneurs can’t be expected to do every business task with the full attention it deserves; there isn’t enough time in the day! With the many challenges that business owners face, it’s important to keep things simple and use all available resources to maximise your business’s potential. Below are some tips to remember for small businesses, hopefully
- Budget realistically
Capital should always be the first concern when starting your company. Most experts would recommend preparing capital to cover your first two years. This gives you time to get off the ground and ‘plant the seeds’. Even an amazing idea can struggle to make money during this time. A critical mistake of new entrepreneurs is expecting profit to come in quicker than it probably can and factoring that into their planning.
At the end of the day you need to have enough to cover your bills, pay your staff and save some for essential business spending. This type of preparation requires significant planning. You’ll need to be able to prepare a sound budget based off of all available facts, especially if you are looking to attract potential investment in your business. Nobody wants to invest in someone who can’t budget properly!
- Plan, plan, plan
Writing a solid business plan and thinking critically about its strengths and weaknesses is essential. This document isn’t the be all and end all of your business, but it is a reflection of how much thought and preparation you have put into your idea. Think about the next quarter, what your goals are and what you need to fulfil these goals. Write this down and constantly refer to it, making sure you are on track. Setting unrealistic targets is not useful, but you equally have to aim high to achieve great results.
Just as important is strategic planning. It may sound far away, but set yourself ambitious goals for 3-5 years from now and then for 10 years. If you’re not scared, then you’re not being ambitious enough! Don’t just think about how profitable you want to be; think about what you want your decade of hard-work to stand for. Do you want to be the industry leader? What do you need to achieve this? Strategic goals are important for reminding you of who you want to be and how you plan to get there.
- Avoid burning out (at all costs!)
Managing the sanity of employee #1 is a priority. You are the driving force of the business and if you burn out then your business is likely to follow suit. Once you start your growth, the workload will increase and you’ll need to find ways to address it. Keep up to date on all technologies that will save yourself time and effort. Don’t try to do everything from scratch; take advantage of other peoples’ hard work and copy what they’re doing. Automate wherever possible; invest in things that will save you time. Many of the most useful business tools are often scaled to remain affordable for small businesses, so use them.
- Carefully asses your talent requirements
Once your business has grown, you’ll be faced with hiring personnel directly or outsourcing your requirements. Budget is a massive factor in this decision. As such, you must carefully assess what areas need more attention and what options there are to address the requirement. Is a full-time hire or outsourcing more appropriate? Some roles require a full-time locally-based employee to fully perform, whilst others can be done by an outsourced team. Paying a little extra to find the perfect person for employee #2 will be well worth your time and could save you significant amounts of money down the road.
You should also ask yourself, can this role/work be done virtually? Look into business process outsourcing. Outsourcing’s value-proposition for small businesses is becoming increasingly attractive, especially in overseas markets where labour prices are low but talent is in abundance. Why do something yourself when a specialist can do it for you in less time at a more cost-effective price to a higher standard?
- Prepare for growth
If you’ve planned carefully, invested your efforts wisely and are able to present a good value proposition to your clients, chances are you’ll be faced with growing pains fairly rapidly. Growth is fantastic but raises a wide range of challenges to small business owners. One of which is an influx of clients which can stretch the business’s ability to deliver. This can leave you overworked and understaffed. A solution to this is seeking relief with an outsource provider to handle a business process whilst you deal with the high demand. Then you can consider your requirements and hire on additional staff.
Despite the challenges associated with growing quickly, looking for new opportunities to develop your business and expand to new markets is crucial to remaining successful and sustainable (the ultimate goal of every company!). Many small companies will get swept up in their short-term success and lose their focus on business development. The job of a business owner is to continually plant seeds and explore opportunities to expand the business.
- Constantly innovate
Constantly maintaining an attitude of innovation in every aspect of your business can be tiring, but it’s essential to remaining competitive in today’s business environment. Just because you are a small business doesn’t mean you can’t be on the cutting edge of business innovation; in fact, it gives you more control to set high standards and maintain them.
Innovation can be manifested in the product/service itself, in the way you deliver it, the way you handle your relationships, just to name a few. With your employees, having an innovative business culture and human resources strategy is essential to attracting and keeping on great personnel.
Running a small business is a challenge. Following these tips can help you help you to remain in control and not lose focus on the big picture. Creating a business that is highly valued by its clients and employees is the ultimate reward. The work never stops for a business owner, but it’s always worth it!