Every entrepreneur dreams of building a successful business from the ground up, but this process can be incredibly complex. According to the Small Business Administration, over half of all businesses fail within the first five years, and you must be diligent if you want to avoid some of the most common pitfalls. Here is a look at a few tips that you can use to establish a world-class company and unparalleled brand.
Make a Comprehensive Business Plan
Even if you don’t need financial backing from an outside party, you should still have a comprehensive business plan. Creating a business plan forces you to do an enormous amount of research on the state of the market and your competition. It will also outline some of your goals and where you plan to take your company in the coming years. When you are ready to hire new employees, parts of your business plan can be integrated into their training as well.
Monitor and Adjust Your Finances
One of the reasons why so many new businesses fail is because owners don’t readjust their spending when new issues pop up. In addition to writing out all of your financial data at the end of every week, you also need to reevaluate your income and expenses once a month. Running out of money at the wrong time is going to drive your company into the ground and potentially lead to a bankruptcy.
Spend Extra Time on the Hiring Process
The employees you hire in those first few years will make or break your business. A high employee turnover rate is incredibly expensive, and every staff member you lose could cost you thousands. As you are screening applicants, you should try to determine if their personality will be a good fit for your company. Traits such as perseverance and loyalty can be much more valuable than technical skills like programming or speaking multiple languages.
Don’t Neglect Your Brick-and-Mortar Storefront
Quite a few companies only do business online, but that could be a mistake depending on what industry you are in. Studies have shown us that 78 percent of consumers prefer to shop in-store, and you could be losing out on a lot of business if you don’t have a storefront. Investing in a storefront will also help you avoid other expenses such as shipping costs.
Spending extra time laying the foundation of your business will make your life much easier in the coming years. Diving right into this process without conducting any research is a common mistake that has destroyed countless companies over the years. It might even be worth it to look into an online mba degree program in your spare time.
This guest post is courtesy of Kara Masterson.