There's nothing small about starting and running a small business. It's a commitment that can easily consume all of one's energy, resources, attention and capacity.
As a non-profit economic development corporation, UCEDC helps develop opportunities for New Jersey businesses through innovative lending, comprehensive training initiatives, and government procurement programs. During my tenure at UCEDC, I've seen many businesses succeed and more than a few fail. There are dozens of reasons why some business survive, while others don't, but here are a few tips that stand out.
Re-Condition Your Business Plan
Everyone knows you need a solid business plan to succeed, so you worked long and hard on yours. But the plan that you crafted last year may not be the plan to carry you through for the next 12 months. Conditions on the ground are constantly shifting, with some indicators improving while others continue to decline.
What conditions should you re-consider? Buying motivation, for one. It may have been all about the lowest price last year, but this year you may have to consider adding or enhancing features that will help you to stand out in an improving (albeit slowly) economy. Tax incentives were key for some businesses how will you adjust now that they've been eliminated or reduced? Keep your eye on your customers and be ready to adapt your plan to their needs and wants.
Don't Put All Your Eggs in One Basket
Despite widespread budget cutbacks in government spending, federal, state, and local government agencies still purchase billions of dollars in goods and services from small businesses. That's a market you can't afford to ignore. So, if you're only in the commercial marketplace, you should think about adding government procurement to your business plan.
Not sure the government is buying what you're selling? You'll be surprised at the range of goods and services that are regularly purchased from small businesses just like yours. For example, take a look at the items listed on the federal government's GSA (General Services Administration) Schedule. And that's just the tip of the iceberg. Don't miss out on revenue-producing opportunities just because you don't know where or how to begin. Every state has a Procurement Technical Assistance Center, like UCEDC, to help you every step of the way.
Let it All Hang Out
This may be the year that you're ready to expand or buy some new equipment and you're going to need a loan to make it happen. When you fill out that loan application, don't fudge the numbers or "forget" to mention something. The more you share with your loan officer, the better able they will be to find the best vehicle for you.
And if you're having a hard time qualifying for a loan, they can advise you on how to repair credit damage as quickly and effectively as possible. Be upfront about everything, including your personal finances, because when it comes to small business loans, your personal credit history is just as important as your business's. Get your financial information organized and ready for submission so the application process goes smoothly.
Not sure where to begin? Take a look at UCEDC's Pre-Qualification Application to see what you'll typically need.
Increase your competitive intelligence.
Sure, you're busy with the every-day details of running your business and barely have a moment to spare. But if you're not making the time to look around and see what your competitors are doing, you're putting your business at risk.
Understanding your competitors' marketing strategy will give you the intelligence you need to keep one step ahead. Depending on your business, you may be able to sample their wares or visit their location. At the very least, check out your competitors' websites and sign-up for email alerts and newsletters. And if you have a particularly strong relationship with some customers, ask them to act as an informal advisory board and share what they like and don't like about your competitors.
Free Help Can be Priceless
If you're not taking advantage of the array of free services and resources for small business owners, you're making an expensive mistake. One-on-one counseling, workshops, resource documents, business checklists they're all available for free through a variety of local, state, federal and private non-profit agencies. Too many small business owners are re-inventing the wheel and not doing a very good job at it. Savvy entrepreneurs know when to ask for help and where to get it.
For example, UCEDC offers a wide variety of free services and tools, including Business Resource Guides for all 21 NJ counties. You'll find our counterparts in every state. The important thing is to take the first step and build an ongoing relationship with a business mentor/counselor.
Get Rid of the Shoebox
It doesn't matter if you're just starting out as a sole proprietor or have been in business for years with a payroll to meet. You need a commercial accounting program, like QuickBooks oralternatives such as Working Point, Fresh Books or GnuCash. Resist the urge to throw receipts into a shoebox or come up with your own accounting system. Keeping clear, accurate records of expenses and revenue is absolutely critical to small business success.
Consider the modest price of the program and the fee you'll pay to an accountant to setup a chart of accounts to be a key investment in your business's future. Once you've started,you need to make the time to input your financial data on a regular basis. It's easy, it's quick and you'll have the information you need to make sound business decisions. Check out PC Magazine's ratings of dozens of tax and accounting programs for small business at http://www.pcmag.com/category2/0,2806,4793,00.asp
To Thine Own self be True
Owning your own business; being your own boss; setting your own hoursall of that can be immensely satisfying for some but equally stressful for others. If you're thinking of starting a business or are still in the early days of a fledgling concern, you need to consider if you have the personality, the temperament, and the support it will take to succeed.
Be honest with yourself. Can you tolerate the risk that comes along with owning your business? Are you willing to devote the time and effort it's going to take to succeed? Is your family ready to join in the sacrifices that have to be made? Even if you answer "yes" to all, a period of self-reflection may uncover some specific aspects of your business that you don't like or don't do very well. In those cases, it's wise to pay for the talent you need. You'll be happier and your business will be sounder.
Hire the Person, not the Resume
You're ready to hire and you want your new employee to hit the ground running, with minimal supervision or training by you. Your instinct may be to consider only those applicants who have the exact experience you are looking for. But that would be a mistake. Smart employers look for work ethic and brains first, and knowledge last. You can always train someone to do a task, but innate talent and a commitment to getting the job done can't be taught.
Instead of just asking prospective employees about what they know, ask them about how they have handled difficult or challenging situations in previous positions. The stories they choose to tell and the manner in which they tell them will give you insight into their character. You may have to spend a little more time getting your new employee oriented to your particular tasks, but they will repay you with productive and committed performance.
Check Yourself Frequently; Enjoy Yourself Plenty
Starting and maintaining a business occupies so much time and thought, that it's easy to let management and administrative goals lapse. Establish a system to ensure that you are on track and will stay that way. Perhaps you'll review this checklist quarterly. Meanwhile, enjoy your business and all that is entailed in managing it. You had a brilliant idea and you've taken it this far. Enjoy the rewards your hard work has afforded you.
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