Every business starts with a great idea, one that provides the initial drive needed to seek funding, hire staff, develop expansion plans and take out the first office space.
For most business owners, this can’t fuel the fire forever, and they need to begin thinking long term with regards to surviving the first year of operations and building a strong strategy.
When just starting out, it should become a priority to set achievements or milestones. These can help the business outline a clear idea of where it needs to be at defined points in time. For example, setting four 90-day plans for the first year with specific targets to be met can show whether or not the business in on track.
Good targets for many new businesses are profit goals, or the signing of new customers.
In addition to putting clear targets in place, it’s vital not to underestimate growth. While most companies are often focused on gaining enough customers and sales to stay afloat, others may find themselves overwhelmed. This can be troubling when the necessary staff and facilities are not in place to deal with demand.
Also Read: Ensuring sound financial operations in a small business
Tradesmen, for example, may find themselves booked months in advance and subsequently unable to take on new customers. Hiring outside help is often the best measure here, and one that deserves consideration.
Keeping a lid on costs is the final step for new businesses, and one that can lead to failure to survive the first year if not prepared for adequately. When so many expenses are presented at once, such as vehicle fuel, trade show attendance fees and website construction, it can be easy to simply release funds as they’re needed.
If a lid isn’t kept on these costs, spending can quickly spiral out of control.