Even many long-time small business owners would agree with the line from the 1970’s song by the band Faces: “I wish that I knew what I know now.”
Over the years of running a small business, owners inevitably gather many lessons about how to grow and run a business more effectively. Thankfully, many of these owners are more than happy to share their insights.
Why struggle alone when you can learn small business tips from the experiences of others who are on your same path? Here are 12 tips from successful small business owners that are worth paying attention to.
Small Business Tip 1: Keep Your Day Job Just a Little Longer
This is one of the top tips for starting a small business because it is a common trap: A person gets excited by a small business idea, quits his or her day job—and then runs out of money and fails.
As reported in Forbes, Spanx founder Sara Blakely credits her success to the fact that she kept her day job as an office equipment salesperson for two years, learning to work with minimal sleep as she got her form-fitting shapewear company off the ground. Blakely did not want to resign from her day job until she was absolutely sure her small business idea would work.
By the time Blakely resigned in 2000 from what was then office equipment supplier Danka, she had already spent countless nights and weekends studying pantyhose design and existing patents. She would drive from her Atlanta home to North Carolina, where she sought out hosiery mills willing to make the product.
“There were days that I’d be at Danka all day and the semi-trucks would drop boxes of Spanx outside my apartment … I resigned on October 14, 2000. I quit Danka and two and a half weeks later I was on the Oprah Winfrey Show,” Blakely says.
Small Business Tip 2: Avoid Distractions at All Costs
A few years ago, Seattle-based content marketing company AudienceBloom was operating so swimmingly that its founder and CEO Jayson DeMers decided he could get away with focusing on a second startup that he was intrigued with. DeMers would come to regret the decision.
“Running a company ‘just fine’ is not what an entrepreneur’s job is,” DeMers says. “Successful entrepreneurs don’t do the minimum for their company; they constantly work to grow it, evolve it, and prepare it for the future. Because I was splitting my team between the two startups, growth stalled at my first company, and I didn’t have enough time to dedicate to the new startup to make it successful.”
Eventually, the second venture failed. AudienceBloom was able to grow again once DeMers was able to focus his full attention on it. “I learned that a successful venture requires 100 percent attention, focus, and effort. Secondary ventures need a full-time manager or else they’ll just distract you and derail your existing efforts if you aren’t careful.”
Avoiding distractions is one of the most important small business tips and applies to managing yourself so you get stuff done on a day-to-day basis, too. “I know when I’m smart and when I’m dumb,” says Marks. “I save the big tasks for the morning when I’m smartest and do the monotonous ones when I’m dumb at the end of the day.” Keeping yourself organized and on task is the real key to small business success.
Small Business Tip 3: Legally Establish Your Business
Many businesses start out as sole proprietorships. This is an easy way to start selling goods and servicing clients. But there’s a lot of risk with being a sole proprietor. If somebody makes a legal claim against your business and wins the case, you could stand to lose a lot of your personal assets.
Another popular business structure is the LLC or limited liability company. When you establish an LLC, you help protect your personal assets from business liability and lawsuits. If your business gets sued, you may end up losing all your business assets in the case. But, because you are an LLC, you will not lose your personal assets.
Small Business Tip 4: Keep Your Business and Personal Expenses Separate
Did you know that some business credit cards won’t affect your personal credit? It’s true. There are some business credit cards that don’t report out to consumer credit bureaus. This is one of the top tips for starting a small business and is one of the many reasons why you should keep your business and personal expenses separate. But don’t just draw the line with credit cards. Look into business savings accounts, checking accounts, retirement accounts, everything.
Doing this will help you when it’s tax time. It’s very easy to pay your taxes—or, heaven forbid, organize your expenses if you get audited—when you keep things separate. It also can help with your professional image. If you’re paying vendors, employees, or reaching out to investors and you’re using a personal account, you’ll give off the image of an amateur. Your business isn’t a hobby. Treat it like a business and get business accounts.
Small Business Tip 5: Document Your Processes
If you have your processes documented, then it’s much easier for you to onboard new employees, or to move existing employees into new roles and take on new responsibilities. Software like creately is very helpful for documenting, visualizing, and managing a wide variety of business processes.
Small Business Tip 6: Write a Business Plan
A business plan is essential if you’re working with investors and is one of the most necessary tips for starting a small business. They want to know what resources you have available, where you plan on taking your business, and how you plan on getting there. The kinds of things you want to include in your business plan are:
- A description of your company
- Your organizational structure
- The products or services you offer
- Your sales and marketing strategy
- Profit and loss estimates
If you’re not going to be working with investors, then your business plan doesn’t need to be as visually polished. In fact, some would argue you don’t even need a business plan. However, the thought process that goes into creating a business plan is good for every business. A mission statement might be helpful for when you’re hiring new employees. On the flip side, one common mistake that many first-time business owners make is spending too much time writing up their business plan.
Small Business Tip 7: Avoid Grand Designs
Adding on to our previous small business tip about writing your business plan, you want to stay away from the grand design.
The grand design is a huge, elaborate business plan that isn’t broken down into smaller steps. First-time business owners often think they need to get every part of their business plan executed in order to start their business.
Instead, look at your business plan and figure out what the smallest amount of that plan is that you could implement as soon as possible to start making money.
For example, you have a business plan for a pizza franchise that is set up near all the college campuses in your state. That’s a pretty ambitious grand design. It might be a good end goal. But the place to start is by opening a small pizza shop in one location and making that successful.
Small Business Tip 8: Don’t Try to Be an Expert on Everything
There’s a fine line that business owners need to walk between bootstrapping their operations and overextending themselves. If you’re a CPA and you’re running an accounting business, you may be able to handle your marketing efforts. That is if you have some talent with marketing. A good small business tip is that once your business is making money, stick to what you’re good at, and hire a professional for everything else.
Small Business Tip 9: Be an Industry Leader With Customer Service
Just because your business is small doesn’t mean you can’t operate like the bigger companies in some ways.
If you called Apple and someone answered the phone and simply said “yeah…?” you’d be shocked. You’d probably expect a greeting such as “Thank you for calling Apple, my name is Jeff. May I ask who I have the pleasure of speaking with?”
And, if Amazon made a mistake with their logistics and your package arrived two weeks late, you would expect them to do more than simply apologize. You may expect them to give you a gift card or discount on a future purchase.
This is how you should run the customer service side of your business. Think of the best customer service you have received. It’s one of the few things you can easily replicate without a huge budget. It just takes effort.
Small Business Tip 10: Don’t Bet the Farm
There’s a romantic side to running a small business. Social media is rife with stories of people quitting their day jobs and deciding to start a small business that then booms into a huge success.
One of the most realistic tips for starting a small business is that there’s a good chance your business won’t succeed. Or there’s a good chance that the new expansion you’re planning may not succeed. That’s why it’s important to never bet the farm.
You want to choose calculated risks, so the financial fallout from a failure won’t put you on the street. Even Jeff Bezos has been quoted as saying, “I don’t believe in bet-the-company bets. That’s when you’re desperate.”
Small Business Tip 11: Take Care of Yourself
Small business owners are some of the most overworked people in the country. In order to keep up with the daily demands, you probably skip meals, skip workouts, eat fast food, don’t get enough sleep, or enjoy too few relaxing activities.
But ask yourself this: If you got a full night’s rest, would you be more productive? If you ate a healthier diet, would you feel better and be more focused?
The answer is yes. An important small business tip is a personal tip as well: take care of yourself.
Just as you have a list of daily tasks you need to do for your business, you should make a list of daily tasks that you need to do for yourself. This could be things like eating a certain number of vegetables, drinking a certain amount of water, getting into bed at a certain hour, etc.
Small Business Tip 12: Take Time to Celebrate
As a small business owner, you always have a couple of irons in the fire. It’s not uncommon for small business owners to hit a milestone that’s worth celebrating, but then forgo the champagne because they’re fixated on the next 10 projects they’re working on.
There are a lot of different ways to celebrate your success. You can treat yourself to a nice dinner or grab some better-quality takeout and just reflect on the work you’ve done and how far you’ve come.
It’s always great to have people in your life who are happy for you when you succeed. Those are the ones you want to loop in when it comes time to celebrate. But you also don’t want to forget about the people who helped you get where you are. If you have employees, your milestones are their milestones. Let them know about the success that you’re having together and be sure to reward your employees, so they know they are appreciated.
Running a business can feel overwhelming. You may look at these 12 small business tips and think, “How am I ever going to remember all of this stuff?” The good news is, you don’t have to. Just turning one of these tips into a habit will have a major impact on your business. If you’re feeling particularly ambitious, you can take one tip a month and work to make it a habit. By the end of the year, you may find that you’re a completely new business owner.
SOURCE: The Hartford Insurance Company