Downfalls
like not being a profitable venture, startups shutting their doors or even
bankruptcy are often caused by a lack of knowledge or a willing ignorance
amongst small-business owners.
“If the
owners really knew what they were doing wrong, they might have been able to fix
the problem,” entrepreneur and business speaker Jay Goltz told The New York Times. “Often, it’s simply a matter of
denial or of not knowing what you don’t know.”
Don’t fall
into the trap
a. Armed with the following knowledge and know-how, you have a
fighting chance of making it as a profitable business that continues to scale
for years to come.
1.
Prove your expertise. To get customers to trust you (and pay for your products
or services), you have to prove you’re an expert in your industry.
You can accomplish
this by posting blogs, sending out newsletters, participating in interviews,
publishing content through noteworthy blogs or publications and making
informative how-to and instruction videos that relate to your business.
“You cannot
buy trust at any price. But slowly, over time, you can build it for free,”
business advisor Jeffrey Gitomer told Copyblogger.
2.
Take calculated risks. All entrepreneurs are risk-takers. They kind
of have to be, as it is a huge leap of faith to start a business. But what
makes one entrepreneur succeed, where another will fail has to do with if a
person makes calculated or reckless risks.
Look at the
costs and benefits of every decision and figure out the worst-case scenario.
Have back-up plans in place and rely on trusted advisors like your accountants,
bank, marketing consultants, lawyers and insurance agents.
Carefully
plan out your course of action and make it a collaborative effort amongst you
and your employees. That way, if failure does occur, you have people there to
support you and assist you in deciding the next move and risk you should take.
Plus, by taking these more conservative risks, you are less likely to make a
mistake that could have detrimental ramifications -- ones that could create
financial situations that are hard to climb out of.
3.
Develop a cash-flow strategy. Having a steady flow of cash is critical when
you have a small business. You need to pay the bills and your employees, as
well as purchase materials to scale your services or build your products and
more. You also need to make a list of one-time expenses and ongoing expenses
and figure out how much money you’ll need to operate on a day-to-day basis.
One great
tool is SCORE’s break-even chart, which allows
you to track your profits and can help you see how to increase them. To prepare
for slow times of the year, you should save at least three to six months worth
of cash to keep your operations going.
4.
Appreciate your employees. When you hire employees, make sure that
they’re actually passionate about the industry you serve. If an interviewee is
enthusiastic, does his or her research about your business and asks engaging
questions, then he or she is likely to be a good candidate for a position and
could provide
mazing insights into growing your company.
Once you
hire your rock-star team, treat employees as equals and trust them. Show that
you appreciate their efforts by encouraging new ideas and
collaboration. You can do this by simply being available to them and being
positive when they have suggestions. If everyone is on the same page and feels
like they have a say, the business is more likely to thrive.
Small
business success can be achieved by thinking ahead and planning out your next
move. It’s a challenge to run a small business, but with the right preparation,
you can come out on top
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