The idea of starting your own business and being your own boss is a concept that many of us find exciting. According to the Small Business Administration (SBA), over 600,000 new businesses are started each year in the United States. The SBA also reports that approximately one-third of those businesses will fail within the first two years. So as a new business owner, what can you do to make sure that your business is not one of those that fails?
Do have a plan
Make sure that your business has a documented business plan. This should include a definition of your business, short term and long term plans for growth, a cash flow projection and most important of all, a budget. Some businesses start out without a defined budget. These owners may have a dollar figure in mind of how much it will cost to start and run a business, but many times, these business owners have not taken into account all of the costs required. By having this information documented, the likelihood of not accounting for a business cost is minimized.
Do ask for help
Many small business owners think that they need to do everything themselves in order to save money and minimize costs. This mindset can leave business owners vulnerable especially in the areas of accounting and legal or regulatory aspects of the business. By seeking out professional help in these areas, business owners can eliminate fines, fees or charges that might result from attempting to do it on your own. Depending on your business, you may be able to offer your services to another business owner as a barter for their services to reduce costs.
Do the right thing
When starting out, it is necessary to register your business with all of the applicable federal, state and local government agencies. These can range from registering for a federal tax number, to a privilege license for your local city or town. Since these requirements are dependent on the type of business and the location, it is important to seek out a professional who is familiar with these requirements in your local area. While it might be tempting, especially for a one person business, to forego some of these requirements when starting out, the risks of fines and additional tax implications in the future outweigh the benefit.
Do know what you do
Many new businesses have a tendency to lose their focus when starting out especially if the business is slow to take off. Business owners will look for other areas to focus on to try and increase customers and sales. Don’t fall into this trap. It is more important for a business to do one thing well instead of doing several things so-so.
Do make opportunities
As a small business owner, it is important to take advantage of every opportunity to create a connection or make an impact on a potential customer or client. Whether it is at a networking event, a social event or a chance encounter at the grocery store, have a 30 second story to describe your business ready to go. Your story should be tailored to the environment and to the recipient. Practice makes perfect so whether you pitch it to your family or to yourself in a mirror, the more you do it, the better it sounds.
Do not make the business your life
While it may seem that you need to be working on your new business 24/7, for the benefit of yourself and your business, don’t. We all hear about the importance of a work/life balance for all workers, but this is even more important for small business owners. As the boss, we need to take some time away from the business for ourselves to make sure that we are healthy and well-rested. This time away from the business can ignite your creative juices while also strengthening relationships with family and friends.
Do not follow the herd
As a new business, it is important to differentiate yourself from other businesses in the same field. Potential customers or clients will need a reason to use your services or products. Offering a unique service or benefit to your customers is a great way to entice potential customers into becoming actual customers. Loyalty programs for frequent customers, drop-off or pickup services or recurring customer discounts are all ideas for setting your company apart from the rest.
Do not forget customer service
Providing first rate customer service is another way that you can set yourself apart from other businesses. It is important to provide outstanding customer service all the time. This means that even if a customer is being difficult or has a complaint, handle it with a smile. Many times our most difficult customer can turn into our best advocate if the situation is handled correctly. The most important aspect of providing customer service is to not take any complaint personally. This can be difficult for a small business owner as we are often times the face of the company, but by keeping a level head the situation can be resolved to the satisfaction of both parties. Remember that customers are the lifeblood of a small business and can make or break your business. Keep them happy, and they will keep coming back.
Do not be inflexible
Another benefit a small business can provide over a larger business is the ability to be flexible. With a small business, if something isn’t working you have the ability to make changes as needed without having to get corporate approval. This can range to overriding a return policy at a retail store, to modifying a service package based on customer feedback.
Do not stop learning
It is important for small businesses to maintain a competitive edge. Depending on the business, this can mean keeping industry certifications up to date or staying on top of current trends. So whether it is a training class, a subscription to an industry publication or a trip to a convention, designate the time and money to make sure your company stays up to date and relevant.
Summary
Owning and running a business is a dream that has become a reality for many Americans. While many business owners think that being their own boss is going to be better than working for someone else, business ownership has its own set of pitfalls. By following these tips, business owners should be able to navigate around obstacles and maintain a successful business for years to come.
