Four Ways to Build a Strong Foundation for Your Small Business
Today, more and more people are pursuing entrepreneurship as small business ownership becomes more accessible. With online trade on the rise, there’s often no need to pay hefty rent costs for physical premises to start making money from your own company today. However, just like even the smallest of houses will need to have a strong foundation to prevent it from collapsing during the early stages of building, your small business will also need to be built on a solid foundation of planning and preparation for it to succeed. With nine out of ten small businesses today failing within their first year, getting the foundation stages right is even more important than ever. Read on for our top tips.
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Tip #1. Write a Business Plan:
You might not think that a business plan is necessary if you’re trying to start a blog, affiliate website, e-commerce store, or other sole proprietorship. However, no matter how small your business is, a strong business plan is key to your success. A good business plan should be adjustable, so that when you revisit it, you can make changes according to company needs and predictions. Find out more with this short business plan template.
Tip #2. Separate Your Business and Personal Lives:
With many of today’s entrepreneurs working from home, it can be harder than ever to keep your business and personal life separate. The first way to do this is to establish a business bank account where you will keep all the profits and expense funds that your company needs. Paying yourself wages from your business bank account into your personal account will help you further separate the two and make it easier to manage finances from both sides. If you can, have a home office or a space in your home that’s used exclusively for work during your office hours – this way, the rest of your home is free for leisure purposes and your day will be more structured.
Tip #3. Regularly Review Your Performance:
Working for yourself can mean that you are free to work when you please, away from the constraints of an employer or boss. However, it also means that you are your own boss, so you’ll need to be straight with yourself about your performance, especially when there’s nobody there to appraise you. Use analytics tools to determine how well your business is performing and consider working with a mentor to improve your own entrepreneurship, communication and customer service skills.
Tip #4. Have Money Set Aside:
Many start-ups have a shaky beginning, so it’s important to ensure that you’re financially supported if things go awry during the first few months or even years of business. Any good entrepreneur knows that business can be unpredictable at any time, so will always prioritize having emergency capital available if needed. A cash reserve set aside in a business savings account will provide you with the funding needed to cover necessary expenses if work slows down or a client is late with a payment, for example.
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