Starting a new business is always risky and the chance of success can be slim without proper planning. Passion about a business idea is just the beginning of what it takes for success; add a teaspoon of patience, a cup of strategic planning and a bucket of tears along with a dose of migraine. You must be ready to roll up your sleeves and get working. According to the U.S. Small Business Administration, roughly 50% of small businesses fail within the first five years.
Sylvia Browder, a small business consultant and coach, shares 5 easy ways you can position your small business for success:
1. Manage Your Cash Flow
You know the old saying, ‘cash is king?’ For a new or growing business, a well-developed cash flow projection can make the difference between success and failure. For an ongoing business, it can make the difference between growth and stagnation. The bookkeeping, accounting system, record keeping, taxes, collecting money, insurance, budgeting and managing risk are all part of keeping your business’ financial solvency. While many people consider this the most painful part of running a business, it needs to be handled well if you are going to stay in business.
A few helpful tips:
- Have both personal & business budgets that are continuously updated
- Track spending and look for areas to cut costs
- Use effective record keeping & accounting systems
- Maintain a surplus of funds to grow the business
- Project and manage “cash flow”
2. Improve Your Customer Service
Every business, large or small, is always looking for new customers. It is a never-ending and vital task! Face it, no matter how great your business might be, without sales, NO business can succeed! We all get bogged down with day-to-day operations, but if we don’t have customers, we can kiss our business, bye-bye! Looking for ways to improve your customer service should be on the top of your ‘to do’ list. Here are a few points to consider:
- Communication is Key: Stay in contact with customers on a regular basis. You can do this by offering them a monthly e-zine subscription; follow up after an order or purchase; send discounts/coupons at least once a month; send out a birthday card or special occasion cards on a consistent basis; and/or create a virtual client focused membership group for a select group of clients to meet on a regular basis
- Simplify YOUR Systems: Is your website easy to navigate and functional? Is it updated or outdated? Do you have a variety of ways potential or current clients can contact you? Can clients easily access your business information? Do you respond to customer complaints promptly?
- Exceed customers’ expectations: This should be a PRIORITY. Enough said!
3. Know Your Competition, FOR REAL!
When you understand who your competitors are, it helps to project sales, avoid surprises, and decrease reaction time as well as helps in understanding your own business better. When you look at your competitors, you are analyzing:
- Who are your major competitors?
- What share of the market do they have?
- How do you compare to your competitors and how will they react to your entry into the
- What are their strengths and weaknesses (e.g. quality, price, service, payment terms, location, reputation, etc.)?
- What factors could increase or reduce your competition?
4. Create Practical Time Management Goals
Small business owners understand, all too well, the importance of managing your time. Time management skills are extremely important as you go through your day wearing the many hats it takes to run a small business. Why do you want to set specific goals to manage your time effectively? Well, setting simple goals will force you to plan your time wisely, thus, allowing you to get a sense of achievement and reduce work and life stress. For example, if spending time with your family is important, try working fewer hours on Friday so that you can honor that goal.
By scheduling your time based on your goals, you can assess if your goals truly align with your core values, both professionally and personally. If you find that your goals are out of align, then you are able to identify key areas that need adjusting before they get out of control.
5. Diversify Your Client Base
I’ve seen it too many times… small business owners who start a business because one or two people promised to buy from them. Relying on a few clients as your main source of income is a recipe for failure!As a business owner, you should always be marketing your services to build your client base. A sluggish economy is NO reason to slow down your marketing efforts. Even if you are at your capacity, always be willing to take on small projects to keep your name out there.
In closing, there are no guaranties for a successful business, but incorporating these easy tips will greatly improve your chances of having a long and profitable small business.