Get a grip on your business!

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Get a grip on your business!

Not wanting to over-simplify the whole ‘running a business thing’, but I’ve developed a list (based on my own experiences, and that of my clients and other business owners), which covers some of the things we need to know for different stages of building a business:

Start-up phase:

  • Start a business because you want to, don’t just fall into it
  • Do your homework – know what you’re getting yourself into, and who else is doing it too
  • Do what you love – have a passion
  • Recognise that it’s going to be tough and be prepared
  • Budget for a completely different level of income than you had in the corporate world (!) (that’s a lower income, not a higher one…)
  • Talk to people who remember setting up their own business, and learn from their advice.
  • Use suppliers who can meet your budget. Don’t be ‘sold’ into paying more than you want to – there will be time enough for that when your business is making plenty of money.
  • Know where you want to go, and don’t lose sight of that
  • Make sure you have plenty of capital to get you through this phase – you’ll need all of it. Keep expenses to a minimum – it will take time to start generating an income.
  • Depending on your financial position, join relevant networks and associations, and attend events. Make sure they’re the same groups where you will find your target market.
  • Draw up a database of all your contacts and spend time getting out there and talking to people. Tell them what you’re doing, and listen to what they need.
  • Try to do business with people you want to do business with. This is likely to be a more effective strategy in generating referrals and building your business.
  • Don’t neglect the marketing fundamentals: understand what it is you can offer potential clients, understand what they need, develop a very clear value proposition, and know who your competitors are and what makes you different. If you haven’t sorted this out, you aren’t ready.

Up and running:

  • Keep the momentum going – keep selling, keep acquiring new business, watch the cash
  • Use good financial measurement systems to understand the key drives and key performance indicators of your business. Think of it as a control panel.
  • Relationships are critical – pay attention to them (staff, clients, associates, etc.)
  • Don’t employ staff until you need them, and provide clear guidelines to those you have.
  • Gradually build your team to fill the gaps as your business complexity grows
  • Make sure you understand your financial and business reports, and generate them on a regular basis.
  • Keep your costs down, even when you don’t need to worry. It’s a good discipline for when you need to pare back, and will keep you in much better financial shape.
  • Don’t take you eye off the numbers! Know how your cashflow is tracking.
  • Secure yourself some reliable and competent advisors – accountants, financial advisors, a lawyer, a business mentor
  • Start to acquire expertise in areas where you’re not naturally strong (finance, marketing, sales, etc)
  • Have goals, know how you’re going to get there, and just do it! Planning without action won’t get you anywhere and you’ll never move forward.
  • Sell before you buy – don’t extend yourself before you have the required level of business coming in
  • Keep focused on your priorities. Don’t sweat the small stuff but don’t ignore the big stuff. Focus on what will generate revenue (and be profitable).
  • Customer retention is important in maintaining stability. If you focus on this now, it will provide a strong foundation for the future.
  • Stay fit and healthy – it takes a lot of energy to maintain and build a business.
  • Get support – business and emotional support is essential. We all need help in some way.
  • Understand the different business models which you could be using, and which are more effective. Don’t be scared to re-engineer what and how you deliver to your customers if a new model is more profitable. This is really very important.
  • Build you reputation and your image. Be consistent in the process!

Established & Growing

  • Implement systems where you can – it helps make the business run more efficiently and makes it less reliant on you
  • Focus on the big picture and know what it looks like.
  • Have a vision and a strategy to realise it.
  • Keep watching the cash.
  • Innovate to stay ahead of your competitors
  • A good client list and a cash cow product will be the key to you ‘having a life’
  • Look seriously at growth strategies and why you want to grow – acquisition, organic or both

Wisdom of experience:

  • Finance & funding are critical – know what you need, be prepared, understand your options – always.
  • Sales and marketing are critical to success – never stop these activities.
  • People management and leadership – start the way you wish to continue
  • Systems and process add value to your business – you may want to sell it one day
  • Revenue from cash cows frees you up from your business. It’s all tied in with the business model.
  • Strategy and execution are a never-ending cycle.
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