Every owner of a new company is motivated to make their dream come true. The excitement of developing and launching a new venture can sometimes distract one from the basics of business. I would like to share some ideas that new business owners should keep in mind.
Start with a business plan
If you’re a small business owner, you might think that business plans are only useful if you’re looking for external funding or support. There’s a high chance that any new business owner will receive this advice from their business advisor: do your market testing, create a business plan, and secure the necessary funding. I’m also sure many of us looked at a template document to complete, diligently working through the different sections to make sure we ticked all the boxes.
If this is your view, then all that effort that goes into creating the perfect document can be lost as soon as funding is received. But look at it another way. Embarking on business planning can add real value to your business, and not just for external stakeholders.
My advice would be to frequently review your business plan and develop an approach to business planning that suits you and your business. Treat your initial business plan as a working document rather than a finished product, and put time in your diary on a regular basis to make sure your business is on the right track.
Evaluate when it's time to hire
Is the business going to keep growing or did you just receive a few additional contracts for a short-period of time? If you’re not sure, it might be better to find some temporary employees or subcontract some of the work out. If your business forecast looks like it’ll continue to increase, then it might be time to hire more employees.
Hiring full-time employees is an investment. Make sure to weigh the advantages and disadvantages of hiring full-time employees versus getting temporary help.
Here’s a mantra for hiring in a small business: “hire slow, fire fast.” As opposed to big corporations, you do not have time, energy, or money to waste on the wrong people. Everyone on your team has to contribute to your overall vision or it’s time for them to go. These are some top tips for hiring staff.
- Be clear on the role.
- Pay appropriately.
- Hire the person over the skill set.
- Consider a temp-to-hire “trial”.
- Do not settle
Assess your equipment needs
Again, is the business load going to keep increasing or is the increase in work only going to be for a short time? If it’s only a short period of time, you may be better off renting any additional equipment needed. If you’re projected to keep expanding quickly and you have the credit to obtain an equipment loan, purchasing might be the best option for you. It’s important to look at your financials, current contracts, and your future business plan to see what’s right for you.
Research your financing options
No matter if the increased growth is short-term or long-term, it’s important to have a financial cushion to pay for the increased work you’ll be doing. Although your sales may be going up, so can your expenses like payroll, supplies, and other operating costs. Consider also that many industries have slow-paying customers, making it difficult to keep up on daily operating expenses.
Depending on your business stage and financial status, one funding option might be better than the other. Compare business loans and accounts receivable factoring to see which one is right for you.
Take Care of Yourself
Managing your small business can be rewarding, but also stressful and time consuming. By following some simple tips, small business owners can better manage their businesses and relieve some stress.
- Maintain a healthy work-life balance. Some ways to help maintain a work-life balance are setting routine business hours and taking breaks throughout the day. De-stress and recharge yourself by developing interests and hobbies outside of your business.
- Set goals. Setting both short- and long-term business goals can keep your business on track. They also offer a sense of direction to guide your business toward its goals and growth.
- Keep your finances in order. When it comes to keeping your records up-to-date and tracking income and expenses, it can easily get out of control using paper, file folders and spreadsheets. By keeping your finances organized throughout the year, it will help when it comes to tax time.
- Stay informed. With any business, it’s important to stay informed about your industry, business trends and current events. Subscribe to some industry newsletters or to Google alerts to stay current.
- Find a Mentor. Connect with people who have experience in developing or launching a business. Use them as a sounding board for ideas and advice.