As a small business owner starts to scale their business there are a number of tasks that come up that they might not expect. Most entrepreneurs start out on their own because of a feeling that they are meant for this. Entrepreneurs will claim they don’t have a choice; they are built to run their own business. To some degree I can relate to that feeling. Although, you can learn to start your own business, it’s much easier to do so if you have the burning desire. Starting your own business is a very exciting time. The idea is born, the business plan is written, actions are taken and you are off and running. Your idea actually starts working and people are giving you money. You are elated; you can’t believe your luck to be running your own business. However, starting your own business has lots of curveballs as well. Here are a few things the small business owner might not see coming when they start up.
The Difficulties Of Scaling A Business
It is very difficult to scale a business. Product based businesses can be easier to scale than service based businesses, but no matter what, it's difficult to scale a business. Many times business owners don’t have a business background to begin with. Great business ideas can come from anyone. Think about it, you are using a product or service and say to yourself “I wish it could do this.” Bingo a new business idea is born. If you wish a product could do something, most likely many other people have the same desire. So you act on your thought and start a business. Generating an idea is one thing, but turning a profit is another. As you scale your business don’t be afraid to ask for help. Nobody expects you to be an expert at every aspect of running a business. Also, don’t lose vision of what you want from your business. Not every idea has to become the next hot multi-billion dollar company.
Being In Sales
You started your own small business and guess what? You are in sales. It doesn’t matter if you are trying to sell a product or a service to customers because either way you are trying to sell. Recognizing that your #1 job as a small business owner is to sell and grow the company is an important revelation. Accept that you are in sales and your mindset will change as to how you run your business.
I would have never guessed that a large portion of my job as a small business owner would be writing. I'm a bookkeeper not a journalist. However, with the increasing importance of inbound marketing you have to be constantly producing new, quality content for your website. We produce all of our website content internally. Writing several blogs per week, creating eBooks, landing pages and QuickBooks tips videos is a lot of work. Like I said I never thought I would write as part of my job as a bookkeeper, but it has produced a significant portion of our leads and customers.
As a small business owner you will have quite a bit of administrative work to do. Tracking time, managing employees, staying in compliance with new laws, handling the insurance policies and paying the bills are just a few tasks you will have to do. Having an administrative assistant can help but that costs money. No matter how small your business is you will need to keep up on human resources and administrative work.
You will also need to keep up on your record keeping. Keeping your bookkeeping updated is important for many reasons beyond just filing your taxes. A solid bookkeeping system can be used as a tool to help run and grow your business. You don’t ever want to have any issues with invoicing customers because you want to keep the money rolling in. You also need to keep a handle on cash flow so you will know if you have enough money to cover payroll and pay your bills. Many people look at bookkeeping as a hassle that is a waste of time. If you have that mindset you might want to consider using an outsourced bookkeeping service. However, I don’t recommend that you ever step out of the bookkeeping process altogether as there is a lot of valuable information in your financial records.
Forecasting and Planning
I think that financial forecasting and budgeting is an area that many small businesses simply ignore or just overlook. Putting together a financial plan for your business can be difficult and time consuming. Many business owners lack the skills and knowledge to put together a budget and forecast. However, small business financial reporting and analysis is something that you should make time for. Forecasts and budgets set goals and are a great way to hold managers and employees accountable. Without a forecast and budget in place you are running your business blind. How could you ever know if you are doing well or not?
Hiring And Retaining Quality Employees
Most small business owners probably understand that at some point they are going to need to hire some help. However, I think that many people over simplify the process of finding and retaining good help. They get to the point where they need some help, understand that they need to hire and then realize they don’t have a clue how to find quality help. Here are a few things I might suggest when hiring help:
- Don’t wait until you are 100% full with operations to find help, instead aim for 70%-80% full. This will promote growth and also allow you adequate time to find quality help.
- The best jobs are not advertised so how will you find help?
- Take training your employees very seriously and don’t be afraid to let them know when they are not meeting your expectations.
- Treat your employees the way you would like to be treated. Pay them well and give them good benefits. They will respect you, enjoy working for you and this will improve employee retention.
- Hire people that are smarter than you and have different strengths than you do.
Starting you own business can be a very exciting time. However, even with an education in business and experience you can’t be ready for every challenge that you will face. When starting out don’t be afraid to ask for help when faced with a challenge. Chances are someone else has faced a similar situation and will be able to keep you from making a costly mistake.