Starting your own small business is one of the most exciting and rewarding things you can do. It's also the most challenging endeavour you'll embark on.
According to the US Bureau of Labour, 75% of new businesses make it through their first year. But only 50% go on to make it past 5 years. Your first year is one of the hardest and if you've never ran a business before, there's a lot to learn about.
How can you best prepare your business for success? Read on for 10 of the most important things your small business needs to do for a successful first year.
1. Manage Your Money
One of the biggest reasons businesses don't make it past their first year is down to mismanaged money. If you don't have the cash flow to stay afloat, your small business will drown.
When it comes to your small business, there are some questions you need to ask yourself. Will you need to buy inventory? How much should you have in stock? How long does it take to get payment from clients? How much is rent? Do you have employees to pay?
You need to understand the different aspects of the business which will need money and plan for them.
2. Stay Frugal
In the first year, a lot of the money you make should be going back into the business. To stay afloat yourself, you need to be frugal.
You shouldn't expect to be making big bucks within the first year. This means you have to pull back on any unnecessary spending. Instead of taking clients on lunch meetings, meet for a cheap coffee instead. Instead of leasing an office, work from home.
These costs all add up. If you stay frugal throughout your first year, you'll help your small business grow.
3. Start Networking
The most important thing to keep a business going is a steady flow of clients. If your business is new, you need to put yourself out there.
Get online and find local business networking events. Print out some business cards and start attending as many as you can.
The most people you meet, the better. Anyone has the potential to be a client, investor, partner or mentor. These are all valuable relationships to build and you can help each other out.
Try not to come off as pushy and respect people's time. Reach out to people you've met for meetings and make sure to send follow up emails thanking them for their time.
4. Start Marketing Your Business
A lot of small business owners find marketing strategies intimidating. Most aren't sure of where or how to invest in marketing. But it's a vital way to get your business out there and encourage people to come to you.
Of course, in your first year you'll have a small budget. This means you can't blow your money on huge marketing campaigns. But there are still a lot of things you can do.
Google Analytics is a free tool you can use to see how many people are coming to your website and from where. Use social media to give your business an online presence. Interact with and inform users of your business and get into self-promotion!
5. Listen to Feedback
One of the main goals of your business should be to give clients and customers what they want. Listening to their needs and customer feedback is a great way to learn how to adapt your business.
If you pay attention to what they want, you can make changes that will benefit your business in the long run. You must make your business into something which satisfies your customer's needs. If you do, you'll get more sales and customer loyalty.
6. Understand Your Competition
Your business won't be the first of it's kind, so you need to scope out the market.
Figure out who your competitors are and how they run their businesses.
What are they doing? How good are their prices? How do they market themselves?
Become aware of indirect competition too. Other businesses mightn't be direct competitors. But aspects of what they offer could compete against you.
Staying aware of the competition lets you put yourself ahead of them. If you keep an eye on them, you can compete with them. Things like promotions and sales can help get their customers coming to you instead.
7. Conserve Your Energy
When you start a new business, it becomes your baby. You want to protect it and help it grow to be as brilliant as possible. It's easy to get over excited and plan meeting after meeting. It's easy to get swept up and make your whole life revolve around the business.
But remember not to burn out. Don't say yes to every single thing. Plan each move and assess how each opportunity would help your business plan. If it has no real impact, don't pursue it.
8. Ask For Help
We like to think we can do it all by ourselves, but in truth we all need help sometimes. When you hit a problem you don't know how to solve, reach out for help.
Reach out to your friends or business mentors and see how they can help. A friendly face and some advice can go a long way. They may even be able to put you in touch with other professionals who can help you solve the issue.
9. Make Time For Personal Relationships
If you start a new business, you'll be putting a lot of your own time into making it grow. But that doesn't mean you should put all other relationships on the sideline.
There will be ups and downs and you'll need support from family and loved ones. If they suffer, your business will too. Working as a team is best for everyone. You'll make better business decisions and build a stronger relationship.
10. Learn From Your Mistakes
Managing a small business means you'll be experimenting with different strategies. Some will work very well and others will fail.
Don't get disheartened when this happens. Instead, learn from it and think about how you can use that failure as an advantage. Ask yourself questions about what went wrong and how you can change it next time.
The more you grow, the more your business will too.
Everything Your Small Business Needs to Thrive in its First Year
Your first year can be challenging. Your small business needs a lot of care to thrive in the first year.
These ten things are the best ways to care for your business and help it grow into a success.
Find this useful? Check out our blog for more great small business tips!