It’s never easy to start a business and get it running as smoothly as possible. Most importantly though, you need to lay the best possible foundation for the coming days.

You may have started a business from scratch and sorting things out to have it up and running. On the other hand, you probably have bought an already established business, perhaps from business for sale websites such as ExitAdviser, BizQuest, BusinessBroker or others.

Whether starting your own or buying an established company, you can avoid a number of things that have destroyed other businesses out there.

  1. Sort out cash flow matters beforehand

So many businesses usually fail at the beginning for diverse reasons. However, if cash flow issues were sorted beforehand, chances are things would pick up fast. Always remember money will be a huge determinant in the success of your business. As such, be very clear where you intend to get funds from and how much. Not just that but also how you intend to spend every dollar that you put together.

In case you don’t manage cash flow efficiently well, the startup or new business will start off from a very shaky footing and could collapse any moment. Your new business doesn’t have to hit a dead-end and halt operations when the flow of money isn’t well managed. Even the most potential business backed by great ideas would go nowhere. As such, come up with a budget and ascertain where every single coin will go.

2. Monitor spending well

A new business attracts a lot of expenses and spending can be exponential throughout. You will find so many things that need to be bought, ordered or paid. Monitoring and tracking spending and every single expense cannot be avoided. If you can afford one, do hire an accountant or bookkeeper to mind your financial books and affairs.

Of course, your budget may be so small to warrant a full-time financial expert in your team. In such a scenario, make the most of accounting tools to keep things organized and all expenses tracked and managed. Such tools will come in handy when you need to do taxes by the end of the year while helping you remain on top of your cash flow.

Accounting and financials can be easy to handle at the beginning but as your company grows, expect things to be very complicated. At such a time, you may have no option but bring in a professional accountant into your team.

3. Mind fixed expenses right away

Once your business is up and running keep tab on fixed expenses at once. To remain operational for as long as possible and make a good profit, avoid wasting so much money on fixed assets. For instance, you don’t need expensive furniture and fittings or expensive meals delivered throughout the day.

By shrinking your operations you can save sufficient funds to boost your capital. From the beginning, avoid the temptation to invest in luxurious amenities and fancy offices as many startups and new business owners tend to. Stick to growing revenue and not expending it.

4. Prepare for any turn of events

As you begin your entrepreneurial journey or owning a business for the first time, don’t forget things won’t be rosy all the time. Optimism is superb and highly important but preparing yourself for any eventuality is wise.

For instance, by the turn of 2020 businesses were preparing for a busy year, growing their revenue and making big bucks only for Covid-19 to destroy those grand plans. Some had to survive with a shoe-string budget while others simply declared bankruptcy in a matter of months. Those that prepared for the worst in pre-pandemic days of plenty survived even with reduced revenue.

Note that you don’t have to quit your current employment to operate your company fully. You could give the business a few months or more until it’s able to grow and sustain itself. Allow it to be so robust that it’s able to cater for your salary successfully.

Always have some reserve cash for normal business operations and personal use just in case. It could be an emergency fund or just some asset like land or property that could be sold if need be. If fully into entrepreneurship consider investing for your future. Invest in as many areas as you financially can, including Roth IRA if possible.

5. Be time conscious

While in employment you probably didn’t care much about time as you received your pay anyway. However, in entrepreneurship time is very precious. You might even notice the few hours you have daily aren’t sufficient to accomplish all the things you may have in mind. As such, every minute spent on activities unrelated to your company and its growth is money washed down the drain.

6. Don’t forget customers are everything

Obviously, without customers you don’t really have a business. From the onset, work hard to find creative and sustainable methods of attracting and acquiring clients and customers. You may have to incur some costs on acquisition channels, which is worth it. Even so, keep costs low by sticking to a single channel of customer acquisition and explore others later once your finances have picked up.

7. Don’t forget yourself

Your business is important and growing it is vital. Even so, as driven and hard working as you might be the startup should be able to cater for your bills and feed yourself or your family. It’s important to make sure you pay yourself. Even so, don’t draw a big compensation for yourself at the start of the company to avoid crippling it before it had even kicked off. Draw an income from the business sufficient to live comfortably without being extravagant. Dealing with your financial needs allows you to fully focus on growing the enterprise.

8. Come up with measurable goals

Every entrepreneur wants to create a multi-million business of no mean repute. Even so, come up with measurable, achievable short and medium financial milestones. Create little revenue goals to build your confidence and to remain motivated to achieve more. While being a millionaire might be the long-term goal, doubling your customer base in three months is a short-term achievable goal you could aim at.

LEAVE A REPLY

Please enter your comment!
Please enter your name here