When you start a new business, the steps you take during the earliest months will make a big difference to your long-term success.
Once you have walked through the basics of setting up your business and creating your business plan, you need to keep being systematic and organised. Have the following in mind in the months after your launch and you’ll find things easier once your business starts to gain momentum.
Create clear systems and processes
When you’re a one-man show or a small team, you may run your business by keeping all the important information about operations in your head, but you need to think about what will happen when you begin to grow.
As you expand, so will the complexities of your business. At some point, you may take on more employees and there will be tasks that you hand over.
In the early days when things are quiet, work on creating the systems and processes you will need when your team grows. That way, you will be prepared, and the onboarding/training process will be streamlined.
As you build your business, document how things are done, either by recording videos or creating instruction manuals. This way, new people can hit the ground running and there will be consistency across operations and customer service.
Even something as simple as an email signature or the way a person is greeted at the door of your retail store can affect how professional your business appears so document everything and have it ready to share.
It also makes sense to think from day one about the systems and software that will accommodate your business in its more advanced stages. Choose your CRM and accounting software carefully and you won’t have to migrate because you have outgrown a software service.
Most small business accountants use Xero but there may be other solutions to suit your venture.
Create a cash buffer and start hiring
Some enterprises, a café for example, will need staff right away. Other businesses may tick along comfortably for years before the need to bring in more people arises.
The main point is to have money ready when staff come on board.
Tradespeople can often fall into the trap of operating comfortably from job to job. When the time comes to take on an apprentice, suddenly, someone else has to be paid, and the money isn't there. It can cause a chicken/egg problem, where there is enough work for more than one person but not enough money to pay the first round of wages.
You’ll be able to cover the first few weeks of your staff’s salaries more comfortably by creating a cash flow chart of what your business will look like as it changes and factoring in future growth. Then you can talk to a financial institution or your small business accountant about arranging a line of credit, or find a way to have the cash reserves to cover the first few weeks' worth of wages.
Track your financial data from day one
Keeping an eye on your financial data is paramount during the first months of running a business.
If you understand numbers and accounting, this is great, but if you don’t, you should be working with a small business accountant or a bookkeeper from the get-go. This expert will translate your numbers into something you can understand, show you if you’re actually making money and let you know if you need to plug a leak.
All too often, when they start out, small business owners focus on what they are good at. They see money coming in but fail to track what’s going out. Some even lose track and fail to send out invoices. As a result, they run into trouble.
When you’re busy getting your business up and running, get help with accounting, bookkeeping and tax so you don’t run into a major financial roadblock.
Define your values
It might seem like a small thing, but establishing your business’s core values can create a guiding light for the future.
By establishing your principles, beliefs, attitudes and standards of behaviour early on, you and all your future employees will have standards to adhere to.
This can help you decide who to hire and influence the way your people behave around your clients. Having clear values can also attract more of the customers you want.
Don’t forget about marketing
Marketing is a dark art rather than an exact science and it can take some trial, error and experimentation to get things right.
How you choose to market will depend on the style of your business and your customer base. Don’t panic about creating a strategy that sets the world on fire; keep it clear and simple to start with, and remember that you are marketing so you can build a bigger business, not keep the one you have at the same size.
You’ll also need a plan to engage with your existing customers so they don’t forget about you.
Find support from like-minded people
Even if you are the only person in your company, you don't have to go it alone.
There are always online communities of small business owners who are very supportive and can offer you loads of advice. Sharing with people in the same situation as you or who have been through it already is an excellent way to find help and motivation.
You can also enlist the help of a coach, or work closely with your small business accountant for business growth advice.
Set your milestones
At some point, you will have to make the tough decision whether or not your business is working for you in terms of money, customers and time. When you get started, you may have a financial target to hit after 12 months. After this time, you can review it, figure out if you were being realistic and then make adjustments as needed.
After six months to a year, you should be able to feel proud of what you have achieved and excited about the future. This will give you an indication of how sustainable your business will be in the future.
Need help to get your small business off the ground successfully? Reach out to an experienced small business accountant at JVP Advisory today.