The first year of a small business can make or break it, and indeed, many businesses fail within their first 12 months. The tips below can help you spend that first year building a strong foundation and hope to reduce the likelihood that you will not succeed.
Prioritize Your Finances
If you’re already paying off some debts, consider whether low interest personal loans could help you pay them off at a better rate. You may be able to get these from a private lender.
You need to track your finances carefully, understand how your revenue differs from your profit, and have a plan in place in case you run low on money. For the first item, you should keep your business and personal accounts separate. If you aren’t good with money and numbers, you might want to pay a bookkeeper, accountant, or an outsourced CFO to do this for you. For the second item, keep in mind that while you might be generating a certain amount of revenue, you need to subtract your expenses from that to figure out what your profit is.
Finally, you might want to get your own finances in order so that if you need to inject a little cash into your new venture, you are able to do so. This could be especially important if you don’t qualify for a business loan.
Have a Solid Plan
Technically, you only need a business plan if you are seeking funding from investors or you are trying to get a business loan. However, the truth is that writing out a detailed plan will benefit any small venture. The reason for this is that it forces you to ask and answer so many questions, and this can be a great way to identify weaknesses in your market research, pricing, mission, plan for growth or any other areas. It can help you stay focused as well, especially if you have a tendency to run after new ideas that occur to you. You can also think about and practice how you pitch the goods or services that you offer to others.
Work With Others
There are many different ways for you to do this. First, you should be networking. This lets people know what you do, but it can also be a way to find potential mentors or partners. You should also think of working with others to pay people to do the things you aren’t as good at. For example, it may be cheaper, in the long run, to hire an attorney to look over contracts or other legal documents than to find out later where you have gone wrong.
Eventually, you might want to hire employees. Even if you don’t need to do this in your first year, you can think ahead about what kind of a culture you want to create within your company and how you can empower your employees to work effectively and independently. Reading some books on leadership and management can help you better prepare for this role.