When you’re opening a new business, the process can be seriously overwhelming. How are you going to raise the capital you need to operate after the first six months? How fast will you drain your savings? Jumping into a business involves a lot of money and money management – but with the right knowledge, you can navigate these details with ease.
Here are some of the ways you can keep your business operations profitable:
Make your business plan rock-solid.
Before doing anything, you need to prepare a business plan. Although having a strategy for the purpose and growth pattern of your business is important, business plans encompass much more than that. In addition to their practical purpose, business plans help you think about your business in a strategic, process-based way. The simple act of planning out your business involves critical thinking, study and research.
Planning and preparation are going to be incredibly important if you want your company to be successful. While beginner’s luck may give your business a boost in the early stages, you’ll need much more than that for your company to be sustainable. That’s where a great business plan comes in.
Take advantage of technology.
There are tons of apps out there today that can help you make your business bigger and better. Budgeting apps to control your money. Fleet apps to manage your team. Productivity apps to get the most out of your workday. The list goes on and on.
Don’t forget about all the potential apps and free technology you can leverage to make the most of your time. For example, it’s likely that in the beginning stages of your business, you’re not going to have a fully fleshed our HR department or payroll department. In lieu of having the staff to fill those roles, you can use cheap or free HR software that automates paychecks, onboarding, and other rote processes.
Test out your idea before fully committing.
There’s a reason why 60% of businesses fail within the first three years of operation. One of the most important pieces to your business is getting to know people who are already successful in the industry. You should also talk to people who may become customers to get their opinions. If you have the chance, do a test run that’s free where you can evaluate the effectiveness of your products and services.
Not only will this allow you to practice for the real thing, but the resulting feedback can give you valuable insight into what you need to change or tweak to be relevant and successful.
Hire the right people
One of the biggest mistakes new business owners make is surrounding themselves with “yes” men (and women). While it’s comforting to have people tell you your ideas are the best, it’s not helpful to you in the long run and can tank your business. It’s important that your staff and advisors are made up of professionals who can reign you in when necessary. Take time to hire instead of panicking and hiring a bad egg.
Get a feel for the existing market.
Conduct market research, ask lots of questions, and figure out the secondary aspects of your business like your competition and your key suppliers in the business. Understanding the market and your place in it allows you to stand out from the crowd.
Know your customers.
Do you know who your customers are? Can you forecast how their buying needs might change? These are important questions to ask yourself before jumping into a business venture. Customers are the determiner of whether or not you’ll be making money ultimately.
Decide on a business structure.
Depending on your business, you’ll want to pick a structure that makes sense. You’ll have the choice to decide between an LLC or an S Corporation. Each have their own legal and tax consequences and implications. Find an accountant who can help you make the best decision.
Focus on cash resources.
Cash is king – there’s a reason that saying has stuck around. Whether you raise your business funds through investors or savings, it’s important that you’re managing your cash. Knowing the cashflow patterns of your business is critical to your growth.
When you are starting a new business, there are lots of considerations you’ll need to make – especially when it comes to your money. You’ll need to find way to save while promoting and growing your business. With this article in hand, you can begin your journey toward a better business.