In a sole proprietorship, all the profits and decisions are yours – but so is the liability, which is unlimited. A partnership – where two or more people create a non-incorporated business – allows you to share startup costs and management, but again liability is unlimited and you’re financially responsible for your partner’s decisions. In the rarer co-operative, members own and control the business, limiting liability but making decisions more time-consuming. Finally, in a corporation – where the business is a legal entity – liability is limited, but regulations are tight and getting started is expensive.
Network as much as possible. Gain the support of other local small businesses by networking with other small business owners. Join small business associations and participate in community events to raise awareness of your business. Participate in community functions so potential clients will be aware of the services you offer.
You will want to be sure that you are using marketing which is appropriate to the type of people you expect to be interested in your product or services. There is little point in using social media to, for example, advertise a 55+ only cruise line. Meanwhile, if you’re advertising for your new dance club, a printed newspaper is probably not going to be your best bet. There is also no point in advertising a business only available in Chicago to people in Seattle, so consider physical location as well.
Try to find the reason that your income has slowed and act accordingly. Look at your audience and situations. For example, ice cream won’t sell as well in the winter as it will in the summer. To circumvent this, you could serve something else that would do better in the winter, such as hot chocolate.
Use your resources effectively. It’s important to be confident in those things you do well, and realize there are resources to help with those parts of running a business that are not as comfortable. Invest in the equipment you need to help get your business off to a good start. If you don’t have the equipment in-house, look for business resource centers that can help with services needed to run your business such as packing, shipping, printing, and other business service needs. We often hear about the importance of time management, and learning more about available resources can help us better manage our time.
Shubhomita Bose is a Staff Writer for Small Business Trends. She covers key studies and surveys about the small business market, along with general small business news. She draws on 8 years of experience in copywriting, marketing and communications, having worked extensively on creating content for small and medium sized enterprises.
Now on to accounting reports. At a minimum, there are three key reports you should be keeping. The first is your income statement, which details how much money your business has made or lost over a period of time. It generally has three parts: total revenue, total expenses, and net income. The hope is that revenue is greater than expenses, resulting in a positive net income.
Think strategically You started your business with a plan. You need to grow your business with a plan, too. The most effective leaders are those who analyze, plan and look ahead when solving problems and making decisions. Harvard Business Review said a strategic approach to leadership is 10 times more important to being an effective leader than other common traits like communication and skill level. Approaching your daily tasks and long-term goals with strategy and planning will increase your opportunities to achieve success.
This is a very simple way of taking your ideas and figuring out what is worth your time. As you can tell, you want ideas in the “Golden Goose” quadrant, one where there are lots of potential customers and a high price. Plotting your ideas on this matrix help you to not fall in love with your first idea, something we call “idea one-itis.”
Offer free samples of what you do to the right people, in order to get people saying good things about what you have to offer. Word of mouth (i.e. good PR) is the best way to attract new customers. If you get bad reviews or negative feedback, respond positively and fix the problem. People will be much less judgmental about mistakes if you’re willing to fix them.
1. Find 1 person — JUST ONE! — who might be interested in your idea. You can do this via email or in person. If you’re not sure, ask ANYONE that’s close to you, even your parents. We’re not aiming for perfection right now, just people.
From managing to marketing and everything in between, the world of small business can be both exciting and overwhelming. It’s a place where no two workdays are exactly the same and where unpredictable things happen. If you’re thinking about starting (or you already run and manage) your own business, check out the following list of tips to improve your chances of success.
Have great customer service skills. Be good at interacting with people. Practice reading between the lines of what people say. Learn how to meet needs they didn’t know they had. Figure out how to make people happy. Be charming. Most importantly, be humble. The customer may not always be right but you need to be able to let them think they are.
If you really want all those things, you need learn to dig deep into what your customers really want and put their needs first. This takes work, and you need to be prepared to dedicate time EVERY week to make it happen.
You do not necessarily need a full-time employee to handle financial responsibilities. For example, if you have a solid grasp on your inventory flow and cash flow management, you may only need a CPA when tax time comes around.
Even if you’ve hired excellent people, you have to know how to manage them. Effective management is one of the most important skills for a small business owner. It’s a skill to be honed throughout a lifetime, but if you’re new at this, there are tons of resources out there to help you—from online classes (check places like Coursera for free online courses) to books (there are countless titles to choose from) and articles like this one from the Harvard Business Review. To get you started, we also have an article outlining 5 Management Skills to Help You Become an Effective Leader and a guide on How to Motivate Your Employees.
Leadership skills are critical to the success of a new venture. Do you have them? Whether or not you think you’re a gifted leader, you should consider putting management theories aside and focus on common sense as you build your business.
When you don’t have money to start your business, it’s essential you find the right people who can help. You may attend events and trade shows where you can find potential investors. You may also join various online forums on social networking sites where you can find useful tips and resources to bring your business to life.
Purchase equipment. Purchase all of the things you need to start work. This can mean mechanical equipment, computers, telephone, or craft supplies. It all depends on what you are doing. Try to purchase from business supply companies as they will have significant discounts. If you are short of capital, lease or rent is an attractive option too, so as not to block your funds.
Now we come to crunch time — assigning specific dollar amounts to your lists. This process is always going to be a best guess, but be realistic and use past experience, research and advice from other entrepreneurs to guide your cost estimates. Organizations such as SCORE and your local Small Business Development Center or Women’s Business Development Center can provide free and valuable advice about how to calculate your start-up costs.
Delegate responsibilities. You can’t do everything yourself, so delegate the various jobs and responsibilities to qualified employees. Small businesses often require employees to take on many tasks and responsibilities that may not fall firmly in their areas of expertise.
Think about why other businesses have failed. Oftentimes, it’s the wrong product, the wrong pricepoint, the wrong market, the wrong team, the wrong marketing, or the wrong entrepreneur, whose skills weren’t up to speed. Now is also the time to take a critical look at your finances. There might not be much money coming in to start. Can you sustain that?
Is your business idea really unique? What value will it generate? Is it something your target audience really wants? Or is it something you think they’d want? Getting answers to these questions is important to determine whether or not your idea works.
Use technology to your advantage Successful big businesses know how to use available technology to increase their productivity and streamline their operations. Doing the same for your small business does not mean you have to spend thousands of dollars on the most high-end equipment available. But you do need to be smart about the technology you choose to implement in your business.
To estimate your start-up costs, begin by creating two lists — one of things you’ll treat as expenses, one for your assets. Don’t forget to consider items such as brochures, business cards and website development costs or any security deposits you need to make. Consider whether you need the help of a consultant, tax adviser or lawyer to get started. Next, categorize these items as essential or optional — do you really need to spend money on these before you start making any kind of income?
It is easy to come up with an idea to start a business, but not so easy to actually launch and build a profitable business. Eighty per cent of businesses fail in the first five years. Before you take the risk of starting a business, make sure:
When it comes to taxes, make sure you’re filing everything correctly and on time. The website for Governement of Canada has a section of its website dedicated to a checklist for new small businesses and their fiscal obligations and their implications—it’s a good idea to spend some time there to make sure you’re compliant.
Celebrate milestones Everyone deserves a win. So when you get one, acknowledge it! Don’t become so busy and focused on results that you forget to stop celebrate when you have achieved those results or reached a milestone along the way. Even a small success deserves recognition. This positive thinking will generate more enthusiasm from you and your employees, inspiring more enthusiasm on the next project and leading to even more successes.
In addition to a secure payments processor, you can streamline your operations using a variety of software. There are affordable tools to help you manage inventory, employee schedules, payroll, email marketing, and invoicing.
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Take credit cards. Very few people consistently pay for products or services with cash any more. It will be much easier for your business, as well as records keeping and accounting, if you accept credit and debit cards. If you want to save yourself ridiculous fees or keep your business more mobile, consider using the Square. This device plugs into a smartphone or tablet and lets you swipe customer’s card.
To be successful in business you need to be organized. Organization will help you complete tasks and stay on top of things to be done. A good way to do this is to create a to-do list each day. As you complete each item, check it off your list. This will ensure that you’re not forgetting anything and you’re completing all the tasks that are essential to the survival of your business.
You’ll also want a payments device that can accept mobile payments like Apple Pay, which is ultimately where everything is headed. Contactless (NFC) payments like Apple Pay are by far the best customer experience. They’re convenient, secure, and fast, so you can check people out in seconds. Having the latest and greatest payments processing technology allows you to securely accept any form of payment that comes across your counter.
Large businesses can afford to be unresponsive and lose a handful of customers from time to time. Small businesses cannot. As a small business owner, it is up to you to make yourself and your company accessible to potential clients and your customer base. This may require you to make your personal cell phone number or email address accessible to clients as you attempt to grow your business.
Pick your niche. Take stock of your skills, interests, and employment history to select the business best suited to you. Choosing a niche that you can be passionate about will help improve your chances of succeeding. Remember: Many small-business owners succeed in businesses that are hardly unique or innovative.
If you are a retail operation, consider using a tablet with an app-based credit card processor like Square or Intuit GoPayment Reader instead of a bulky point-of-sale system at each register. You can synch your transaction data to your accounting software and utilize the tablets for other purposes as well.
Consider hiring a financial professional. It may be fiscally worthwhile for you to hire a dedicated staff member who can control the financial affairs of your small business. Accountants can help you identify areas of your business that are not running efficiently from a fiscal standpoint, allowing you to maximize your profits.
Tell me if this has ever happened to you: You hear about some super successful friend or famous person and you immediately tell yourself that they had some special advantage that let them be successful.