As we all know, the first year in business can be extremely challenging. Nearly 20% of businesses in the U.S. fail during that all-important initial 12 months. The good news is, with the right preparation and knowledge, combined with ambition, discipline and a willingness to seek help from others, this time can also generate excitement, growth and a bright future.
Read on for tips small-business owners can use to build their new company and for common pitfalls to avoid. Armed with the right information, determined entrepreneurs can learn from the mistakes made by others and pave their own unique path to success.
What essential elements contribute most to growth in a new business’s first year?
Entrepreneurs who embark on a new business venture thinking they will easily surmount obstacles, grow steadily and still have time to spare for golf (or bird-watching, hiking, dog-walking, etc.) aren’t grasping the realities of the situation. As Business Know-How notes, the keys to starting a prosperous new business include:
Basing your new enterprise on a feasible set of expectations, and possessing the right personality traits, are the best foundations for new business success.
For small businesses, it’s all about the customer focus. The ability of small-business owners to create a personal touch for their patrons can be the key differentiator between new small businesses and established competitors.
The goal is to “make each customer feel valued as an individual instead of a statistic” and to know how to create a truly memorable purchasing experience each and every time.
No venture can survive a challenging first year without a well-crafted and detailed business plan. Key elements should include:
While this may seem daunting at first, remember that you don’t have to write a whole book on the subject. What’s needed in a business plan is a document that outlines the above-listed elements in bullet-point format or whatever method is most practical for you.
It takes money to launch and sustain a business through its first year. Your business plan should include an accurate assessment of necessary operating costs, the ability to develop and sustain a minimum-level cash flow and an in-depth look at sources for new business funding.
Fortunately for entrepreneurs, there are many more financing options than in past years. Such options include applying for small-business loans, raising funds through crowdfunding sites and boosting your credit score to draw attention from lenders or investors.
No matter what type of product or service you hope to bring to market, or how you hope to attract customers, creating a robust website is mandatory. Many prospective customers begin their search online, a fact no business can afford to ignore.
Just throwing together some copy and a few stock photos won’t cut it, either. Part of your initial investment is developing an attractive and easy-to-navigate business site that draws people in, facilitates the purchasing experience and leaves the customer satisfied. Anything else will discourage prospects from learning more about your business and will damage your chances for success.
The same principle holds for social media. While there are dozens, if not hundreds, of platforms out there, no business should attempt to be active on all of them.
Instead, as part of your preliminary target customer research, determine a handful of social media sites where your customers spend time (often including Facebook, Twitter, Instagram and LinkedIn) and get active there. Focus on crafting an appealing profile page for your small business and also start thinking about the kind of content (blog posts, articles, etc.) you want to share with followers.
Succeeding in your first year is more likely if you avoid committing mistakes that have doomed businesses in the past.
A new business involves an untold number of tasks; some far more important than others. The more time you spend on issues that aren’t vital, the less time you’ll have for the must-do’s. AllBusiness.com notes that as an entrepreneur, you “need to be very selective in how you spend your time and resources,” because all too often, people in your position “burn the candle at both ends, yet only move sideways and not forward.”
Sometimes, entrepreneurs and new small-business owners don’t possess MBAs. They learn the old-fashioned way, by trial and error on the road to success.
This means they often lack the management skills needed to grow a business — knowledge and experience in everything from accounting and bookkeeping to marketing, recruiting qualified staff, overseeing payroll and more. New small-business owners are well-advised to study hard in areas where their knowledge is limited or to seek out qualified third-party contractors who can provide management acumen on a temporary, as-needed basis.
It’s very likely you’ll need one or more employees to succeed in your first year. Don’t waste time and money going after the wrong candidates; learn as much as possible about the job market and define the qualities you need in your open positions. Then, with a team in place, work hard to manage employees fairly with the right degree of discipline and encouragement. In today’s competitive job market, you can’t expect to hold onto a talented individual if you (or the person you put in charge) lack essential skills for human resource management.
It may seem obvious, but it gets overlooked too often: cash flow is the lifeblood of business. Without capital, you can’t pay vendors or employees and you can’t invest in product marketing, customer outreach or nearly any other aspect of business. Be prepared. Do everything possible to avoid a cash flow crisis.
Make sure you explore ways to connect with people, whether they’re potential customers, prospective business partners, helpful vendors or other novice business owners. Consider the following:
In short, do all you can to meet and connect with others, because you never know where these budding relationships will lead.
Every entrepreneur faces significant challenges during the first year in business. By gathering knowledge, preparing a business plan, building a community and seeking out the best financial resources, it’s possible to overcome these hurdles and prosper.
The post Successfully Navigating Your First Year in Business appeared first on best algorithmic trading strategies.