New Starters – Top 10 tips for start-up businesses
I have just had a fascinating meeting this morning with the founder and CEO of a start-up company, who has both intrigued me with the possibilities and scared me with the potential downside risks of this new venture. I see my job as an adviser is to undertake the task we have been set, raise additional capital, but also reduce the chances of a catastrophic failure, by making sure all of the building blocks are in place, so the business is scalable and sustainable.
So, the top 10 things to get sorted for a new start-up:
- Do the planning! Once you have started trading you will be fighting fires, so it is unlikely you will be able to plan properly later. Think in terms of a business plan with an introduction, finance, marketing, labour/resources, premises, insurance, early milestones and some clear short term and long term goals. Most battle plans do not survive the first contact with the enemy, but the initial planning stage will focus your options for later; the same goes for business plans.
- Get professional advice. You may see this as self-serving, but it is better to learn from the experience of others than make the same (expensive) mistakes yourself.
- Do your research. Try ideas out and see how they get on; test things carefully, as it is easier to fix things at an early stage. Just because you do not like the early results from a test, doesn’t give you a license to ignore them, the knowledge may be valuable.
- Sort your marketing. If people don’t know about your product, they cannot buy it
- Cash Flow. Lack of cash flow kills more businesses than anything else. Manage that and cut your cloth accordingly; slow growth is better than liquidation or bankruptcy.
- Network with other business people. Many of these people will be your customers and almost everyone likes to be asked their opinion. If you have a dilemma, ask the question of a few other business people; someone may have been there before.
- Know your customer; once you have your first few customers, get to know them, learn more about the market and monitor changes. What brought them to you? What will bring them again? What will encourage them to recommend you?
- Make decisions; sometimes the wrong decision quickly is better than the right decision too late to matter. The worst thing to do is to do nothing.
- Measure performance; often simple accounts are just not good enough. What are the real key metrics for your business? Enquiries? Occupancy? Orders? Website hits? If it takes three months from an enquiry to cash in the bank, then measuring enquiries will be a faster messenger of good or bad times to come.
- Keep your customers happy. Thank them for their business, offer loyalty discounts for regular business, keep in contact and ask them to tell their friends.
If you have a business idea, talk to us at an early stage and we will help you along the way. Visit our pages (http://bankfield.net/business/commercial-finance/funding-your-business/ or http://bankfield.net/business/risk-management/).
Contact me with queries
If anyone is looking for general advice, then please write in to the blog and I would be happy to help with anonymous advice posted here. Alternatively, please call us on 0116 253 5600 and ask to speak to an IFA, (Independent Financial Adviser), for a no-obligation discussion.
If you know you need formal advice, have a look at http://bankfield.net/business/ or ask around for a recommendation, it might even be me.