Congratulations – your business is up and running! After months of hard work and research, you have launched your business, brand, products, and services.
The hard work doesn’t stop, however. No matter what your market, remaining competitive and lean is key to business success and stability. But what five factors do you need to pay attention to?
1. Promote, Market, Survive
According to statistics, as many as 8 in 10 new businesses will fail in the first year. But just because you have passed this milestone doesn’t mean your business is destined for great things without any effort.
Businesses fail at any point in their lifespan. For a small or new business, maintaining cash flow is important (see the next point!) but most new and small businesses fail because they fail to continually promote and consistently market their business because they fail to budget for either of these things.
And the reasons for failing to do this are financial.
2. Financial Management and Control
For any business, a large factor in their success is money and the largest factor in their demise is lack of money or lack of cash flowing into the business.
But it is more than this. Failing to control money, to understand where your money is coming from and going to, what your largest overheads are, who have paid their invoices and who hasn’t… the list could go on…
Bookkeeping, totting up receipts, chasing invoices and other forms of credit control are the details of running any business, no matter how large or small. Getting is wrong may not spell imminent disaster but it certainly dents your business, stunting its growth and evolution.
Xero bookkeeping is a method of understanding the financial position of your business in real-time. You can see, at a glance, financial information relating to performance this month compared to the same time last month, last year and so on.
When you have the financial information, when you forecast bumps in the road financially, you can better prepare your business to ride out the rough bits of the journey.
3. Controlling Growth
As a business owner, you have many objectives, one of which is to grow the business. The early months and years are tough but one day, all that effort will pay off.
The problem is, it may pay off too quickly and too much. Growth that is allowed to spiral out of control is just as bad as no growth at all.
Controlling growth means keeping your business stable by balancing the opportunities and the challenges that are presented. Managing growth is an important aspect of managing any business and financially, it is imperative that you maintain a balanced view of assets and investment.
4. Forecasting
Continually looking ahead is no bad thing in business, just as reviewing and critiquing where you have come from can be an important lesson too.
No one has a crystal ball to look into the future to predict what market conditions will be like in 5 or 10 years’ time but, as an entrepreneur, you need to be looking for where the next opportunities and challenges could be coming from.
Have you made plans for when a competitor bursts onto the scene, for example? Do you have contingency plans for changes in technology? These are just two examples of opportunities and challenges you could face.
5. Understanding your Business and how it Matures
The take-off phase doesn’t last forever. At some point, your business will morph into a stable, mature company and this takes a different kind of management and outlook. Are you ready?