Starting a small business: what I wish I knew
By Raels | 27 September 2016
Cash flow really is king.
I hate to say it because if you're anything like me you started a small business because you have a certain skill set, and that skill set isn't in accounting! Setting up, understanding and continually monitoring your cashflow is critical to your business working through the hard times and sailing through the easy times. Don't do what I did and see it as a chore that you put off or try to pretend doesn't exist.
Set aside money to market your business.
We're often so busy setting up our business, getting the infrastructure in place, the offices, the hardware and software that we forget about marketing ourselves. Set aside a good amount of your set-up capital for this, and then add it as a continuing expense. Driving traffic - whether that be foot traffic or online traffic - to your business is critical. No-one will know you exist if you don't.
Use knowledge from others.
I wish I had sites like this one when I was starting out. I especially wish I could have accessed all the templates I need for a small price , as we have here. I would have bought them all in it would have saved me hours and hours. Even now, I look for templates online before I produce one.
Flexible working hours are bullshit.
I wish I had a buck for every time someone has said to me, "Being your own boss must be awesome - you can do whatever the hell you like'. That isn't the case, if you actually want your business to succeed. I have to set an example for my team. I'm accountable to my clients and suppliers. I'm always 'on' because my business is my livelihood - and the livelihood of all of my team that I carry with me. I take the responsibility seriously, and I take it personally. Don't underestimate that responsibility, especially in those early years. Your business will take up a lot of your time.
Budgets are critical.
They may be boring as all get-up, but budgets are critical to you measuring your success, reviewing your failures and making adjustments as you need. They are invaluable in setting goals. They are invaluable in defining the importance of areas of your business. Take my advice: get a good accountant and work with them to set up a solid budget for your business, and review this on a monthly basis.
Learn to build resilience.
Every business goes through ups and downs, it's how those businesses cope during the tough times that really counts. Building resilience early on in your business should be a high priority. Resilience could mean having a back-up for yourself in case you fall ill, or building up your bank account so you can ride out the tough times.
Never fear losing an employee.
I spent countless years worrying and cajoling and nurturing my employees only to have them leave eventually anyway. Everyone is replaceable. It's true. It took me 15 years to work it out. If you are constantly in fear of losing your employees you can very well jeopardise your business by keeping an employee that doesn't want to be there anyway, or by shifting your business focus to suit the type of work they want to do. Don't get me wrong; I have some employees I would bend over backwards for, but I'll no longer try to keep any of them at all costs.
The 55% rule.
I've talked about this before but if you are new to it check out this post. The 55% rule is my saviour. It's the thing that gets me through my tasks. In the beginning I spent too much time on tasks that had little impact on my business, meaning I had no time left for the tasks that would have a huge impact on my business (like marketing and sales!). I apply the 55% rule to tasks - get them done better than average but don't tweak them util they're perfect. Most tasks don't require perfection; they just need to be done.
Partners can be a good thing.
I set up my business without any partners. Yay, great, yippee for me I'm in charge of my own destiny, no-one to tell me what to do or disagree with me. I can make every decision and change the direction of my business as and when I please. Great... nope. Being the decision maker means the buck stops with you. You have no-one to rely on. I have wonderful employees but the reality is that if my business when down the gurgler, they would (understandably) jump ship faster than you can say, 'Is that an iceberg up ahead?' Having partners comes with its own set of challenges, of course, but with the benefit of hindsight, I'd take on a partner next time.
Forget work-life balance.
I truly believe that work-life balance for small business owners just doesn't exist. In the past year, I've chosen to go with this philosophy: You have one life to live - and splitting or compartmentalising it just doesn't work. So I do some home things at work, like paying bills, and I do some work things at home, like checking emails. I have to be far more flexible in all aspects of my life now that I have a family. Having one life, doing things as they need to be done, works for me and I get less stressed about it all.