You have decided to do it! You have a great product or service and you want to be your own boss. You are starting a business.
Here are 5 things you must do to be successful.
- Cash management. You can make a profit and still go out of business for lack of cash. Plan ahead. What inventory will you need to buy? How much do you need to have on hand? How will you collect payment from customers? How long will it take to pay you? Do you have a loan payment? Will things you need (like gas) go up and down? Can you handle it when they go up? These are all things you need to consider – things you need to understand and know how you will handle. If a big customer pays late, he should be able to continue doing business. If your fuel costs twice as much, you have to handle the increase.
- Keep planning. Once you have a plan, don’t put it away and forget it. Check it out, see if it works. Check it. If you planned to get paid in 45 days and your clients are taking 60 days, make adjustments to ensure you have enough cash to cover your costs or, if necessary, set up a line of credit. Monitoring is part of planning, and planning should be a long-term effort. The economy changes. The markets change. Prices go up and down. Following up on a regular basis will set you up for success even as you work in a changing business world.
- Understand your margins. This is what creates your end result. Did you drop such a low price to get a great job that it really isn’t profitable? Is one of your services or product lines dragging down your bottom line? Sometimes eliminating losers makes you a winner. You can bring in less, but you’ll earn more if you focus on your successes. For example, a small local fast-food restaurant may find its location near a high school to be very good, but its location in another part of town may not always break even. It’s time for a menu change, or a move.
- Be an online listener. It’s a wired and wireless world and what your customers have to say about you can help make or break your sales. Google Alerts is free and a good tool for listening to what people are saying about you on social media or review sites. Are they excited about how good you are or are they complaining about your lack of service? If you can, respond to any complaints and try to correct them.
- Be safe. You have a lot to lose: your financial records, personal information about your customers and employees, your future plans—wouldn’t your competitors love to know? Secure your Internet network. Have rules about employees taking work home on an unsecured laptop or tablet. Make sure all sensitive documents are kept safe and shredded when you’re done with them. Remember, data remains on a hard drive unless you destroy it. If you divulge sensitive information, the result can be drastic enough to close your doors.
Plan to succeed! Watch your margins. Find out if your business plan needs to be revised. Consider hiring an on-site shredding company. They will give you locked containers so sensitive documents are safe even when placed in the “trash.” They will destroy these documents, and the hard drives of the computers you no longer use, right before your eyes. Protecting information is protecting your business!