Get These Right and You Won't Be Struggling
If you’re an entrepreneur who’s just starting out on a new business venture, there are a lot of potential hazards you need to avoid – but maybe not as many as you fear. Though conventional wisdom holds that nine out of ten new businesses will fail within the first ten years of starting out, the truth is pretty far from that. In fact, according to statistics from the U.S. Bureau of Labor, three out of four businesses survive their first year, just shy of seven out of ten last two years, and half make it for five years. Even though the odds are not as bad as others would have you believe, there are still steps that you need to take in order to put yourself on the right path.
Avoiding Pitfalls through Planning
There’s no doubt that the first year is a challenge for most new businesses. There are a lot of things you need to learn and mistakes to be made, and it’s easy to get overwhelmed. The secret to success is not in luck, but in planning, and the more strategically and professionally you approach your business operations, the better prepared you’ll be to handle stressful, and even unexpected situations. And one of the most essential ways for you to plan ahead is to work with a business plan.
The Importance of Having a Business Plan
Though many new businesses believe that they don’t need a business plan because they aren’t borrowing money from a bank or investor, they’re wrong: a business plan is one of the most important tools that you can have. By equipping yourself with a carefully thought out and documented business plan, you give yourself a way to measure the health of your business and how well you are measuring up to your own goals. A business plan acts as a yardstick of your progress and whether you are keeping your focus on your original direction.
Concentrate on Cashflow
They don’t say “cashflow is king” for nothing. When your cashflow is unhealthy, you leave yourself in a constant state of panic and stress, unable to pay bills, provide for employees and grow your business. There are many reasons for cashflow problems, with the most common being slow paying clients or overly expensive labor or infrastructure, but whatever the reason it is a problem to be guarded against.
Maintaining a positive cash flow in the first year is a matter of minimizing initial expenses, even in the face of your wishes for rapid growth. Separate needs from wants and make sure that you’re only spending on the essentials until you have a healthy cashflow scenario. The happier your suppliers are, the more able you will be to provide for your own customers, and the greater the chance of long term success.
Assistance with Planning and Establishing Goals
Sometimes the greatest asset you can have in achieving your long term goals is the assistance of an experienced advisor who can guide you through the essential steps of establishing your business. Call our office today for help creating a business plan, an accounting system, and an effective way of managing cash flow.
If you are starting an Orlando business, call us at (407) 901-6229 to help you set it up right!