We’re in the middle of a disruptive business cycle, with small start-ups challenging big players in sectors across the board. Entrepreneurs are offering new twists on established business models and contributing innovative solutions, meaning markets are currently changing at speed.
Even though business is offering entrepreneurs wider opportunities, the challenges facing these new businesses remain the same. If you are just starting out in business here’s how to deal with obstacles that will inevitably come your way.
Managing cashflow
While focusing on winning clients and gaining exposure are the initial goals of any new business, staying on top of the money situation is a constant challenge. Increasing overheads combined with the need to negotiate favourable credit terms and payment terms can take its toll. Cash in business is still King so maintaining a positive cashflow is just as, if not more, important than watching your bottom line.
Keeping staff
Every successful business has a core of committed and talented people. Finding them is difficult and keeping them is tricky, especially in fast moving growth markets where potential rewards offered by more established firms can be seductive. Incentivising staff can include working out share options, bonuses and equity in the business. Rewards do not have to be financial. Offering additional holiday entitlement as a bonus works well as does working toward a team lunch or evening out. Understanding your team and balancing individual’s aspirations with suitable incentives can make sure they stay focused so you may choose to offer additional formal training as a reward for hard work enabling a path for progression.
Working with investors
To keep growing, it’s inevitable that external funding will be needed at some point. This can take different forms, whether venture capitalist, equity or loans. It’s vital that the source of capital suits the business and aspirations of its founders.
When investors are on board, they will require transparency and information. Entrepreneurs can find this difficult as it’s not something they’re used to doing, whether it takes the form of sharing monthly accounts, formal reports or business plans. Adopting the correct approaches to investors from the outset will enhance your chances of success and longevity.
Be prepared to delegate
As your business grows, you won’t be able to manage every single task. Even if the vision and company is yours, you’ll have to relinquish some control at some point. Delegating the right tasks to the right people is a skill that’s worth cultivating. It will allow you to preserve your successes, ensure they continue, and focus on growing the business.
Listen to the right advice
The right kind of external support can help your business achieve its vision faster. It might mean an initial outlay but this can be well worth it. This is particularly true when it comes to complicated areas such as intellectual property, incentivisation and fundraising.
Understand your business
Don’t get lost in data when analysing the success of your business. You need to understand how it’s doing and how well it’s performing to plan ahead. However, this can be done by distilling information down to a page of KPIs, quality insights and overarching financial information.
Network and share your experiences
Meeting up with fellow entrepreneurs or other business owners in your sector can be an extremely effective way of learning how to prepare for unseen challenges. Sharing best practice, tips, tricks and experience is something that can’t be underestimated. Plus, it’s a way to inject some fun into your business ventures – seize every opportunity.
