If you are thinking of starting a business or already managing one, you would understand that unless you are consciously keeping an eye on the bigger picture, running a business can be a little bit of ready, shoot and aim. In as much luck might be discarded (having a great referral, an awesome network and access to the right opportunity, etc.), lots of other minute factors also lead to the success of a business.
Below are some of the factors that are not to be toyed with when running a business.
1. Record of all Expense
About to start a business?
Track every expense that is incurred. Get a box, any and every expense you make regarding the proposed business should be stuffed in a box.
If you are having a beer (or coke) with a friend while discussing branding, that is a business meeting, keep the receipt.
2. Get an Accountant
The first professional you should speak with is an accountant. This might seem so far-fetch but accountants can always help at various stages of business growth. Beyond the tax return that they file and the salary, they also come handy while writing business plan (financial projection), legal business structure, among other things.
Also, give your accountant that box of receipt you got from business expenses, it is called pre-operational expenses. It helps you with tax liability.
3. Business Name
Trade under your business name.
Separate your personal business from the business as well as bank accounts. This would help protect the business owner’s assets in case of debt or legal judgment.
This also adds instant legitimacy and authority to the business as customers, vendors and partners alike prefer to transact business with incorporated companies.
Keep your operational paperwork safe, scan to Cloud all important docs, Small business lose important documents.
Be brand conscious, perception is everything.
Irrespective of the quality of a product or service and the advertising put into it, your business might likely not get very far if it does not have a brand.
From the company’s name, to the logo, stationary, call cards, letterhead among others, everything must be well incorporated to create an experience for the customer.
5. Vision and Sales
Answer should be provided to questions such as;
What is my business known for?
How do we measure success?
How do I want my employee to feel about their job?
Providing answers to these and other questions will help provided the needed insight to grow the business.
As the manager, you have 2 key roles;
- Vision articulation and implementation.
- Business development (as no one can sell your product as much as you can).
Also remember to keep costs low… be your own driver, HR Manager, Strategy Adviser and Secretary until you can pay from operations.
Delegation should also be made paramount.
You might be under the impression that credits are similar, that is business and personal credit alike. As a business manager, that is a mistake you would want to avoid.
While personal credit might be damning to personal finances, it’s not same for business credit.
If you are a small business and you are offered credit, take it as long as it is offered.
Pay back, build up your credit history.
Take the cash you would have used to pay supplier and fix at the bank or put it to use in something else.
Never repay in cash, always seek credit from suppliers.
On a final note, always remember that if you own or manage a (small) business;
- Sales is not profit.
- Operational profit is NOT net profit.
- Net profit is NOT cash.
- Cash is king.
- Credit is the enemy to cash.
- Avoid giving credit.
- And always look for suppliers that will give you credit.
Cited from Twitter: @FinPlanKaluAja