Starting a new business
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Starting a new business is an exhilarating and scary step across a line that non-entrepreneurs will never experience or understand. It’s a bit like going solo if you trained as a pilot. Suddenly there is nobody to back you up, nobody to rescue you, nobody to ask. It is the most incredible sense of achievement and excitement, and a bit frightening too. You can create in the corporate world but there is something special about creating a new enterprise that moves the sense of satisfaction into a different league.
The pointers below are there to help new entrepreneurs to reduce their risk and increase their profitability and enjoyment. And to avoid tripping over things that have felled others – I trust they will be valuable.
• Be passionate. If you believe you supply goods and services that are really great, and you love what you do, you reduce your risk and improve your enjoyment.
• Don’t be a ‘me too’ business – If you are just another supplier doing the same as many others around then you are likely to struggle. Be different.
• You will get scared. You will worry you won’t make it, or be afraid you are not good enough. You will be tempted to give up. Get used to all this, it keeps you sharp.
• Be prepared to work incredibly hard for very little money for a while, and then probably work incredibly hard for a long time but for better money.
• Watch the cash. Check your bank every day. Try not to get into debt.
• Learn about accounting and reading a set of accounts. There are simple courses for this. Make sure you have management reports and accounts every month. Never do the accounting only for tax or audit purposes.
• Customers often pay late and large companies, government departments and municipalities are often the worst offenders. Doing things according to their procedures is far more important to them than your money issues.
• Get your documentation right. Make sure that order numbers, proof of delivery, invoice formats, VAT details and everything else to do with billing is perfect. The main reason for late payment is poor or incomplete documentation.
• There will always be a key benefit that your customers need most. Is it fast response? Bright colours? Safety? Convenience? Something else? Analyse what this benefit is and then make it your focus.
• Ask for help early. If you are going to use a mentor (and the statistics say this is probably a good idea) then it’s better to ask for help when you are developing your business. Don’t wait until you get into trouble or for a disaster.
• If you want to be taken seriously by other businesses then you need to behave like a serious business. Sales literature, business cards and a great web site help, but the most important is professionalism.
• Selling is where it all starts. Concentrate on this aspect. Many start-up businesses fail simply because they don’t sell enough.
• Focus your energies. You will be tempted to be all things to everyone; you will be tempted to take the one big deal that is really not your business. Both of these temptations have been fatal for emerging businesses. Concentrate on the products and customers where you have the best chance of success and profit.
• Stay close to customers. Not with systems but with eye contact. Make sure that the communication is sufficiently open so that they will tell you the things you need to know.
• Drill your staff in customer care. A surly deliveryman or an abrupt creditors clerk can do massive damage. If you use signwritten delivery vehicles make sure your drivers keep to the rules and drive considerately.
• Affirm yourself. You will be doing great things in difficult circumstances, and sometimes it is all too easy to forget that. Remind yourself what you have achieved and celebrate even the little things.
• Have fun. Build relaxation and laughing time into the business.
About Ed Hatton
Ed Hatton had a successful career in sales and marketing management in the IT industry before launching consulting company The Marketing Director almost 20 years ago. Ed is passionate about entrepreneurs and the need to develop the SME sector. He co-authored a textbook on Entrepreneurship and writes the advice column “Start Up Coach” for Entrepreneur Magazine.
More information is available here or send Ed an e-mail.
About The Marketing Director
This consulting company advises and mentors small and medium enterprises with a particular focus on strategy, marketing and sales, and the inter-relationship between these disciplines. The company has been operational for almost 20 years and has consulted to a wide range of IT, manufacturing, services based, and distribution SMEs. The success ratio of client companies is far ahead of industry norms, meaning that clients of The Marketing Director are generally high flyers in their sectors, and survivors when other fail.
More information is available here, or by e-mail.
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