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Starting or managing a new small business in the competitive business world is an exhilarating but risky experience. Small businesses are started every day, often by a passionate entrepreneur with a problem they’re itching to solve.
It takes more than just a good idea to run a business. Every business, big or small, is always concerned about one thing and that is management. Proper management is crucial to the survival of every business. Small business entrepreneurs need is to be equipped with good management skills and abilities to turn their venture into a success story. Learn great tips on how to successfully manage a small business.
1. Manage your time very wisely.
As a small business owner, you know that time is your greatest asset. You can lose money and get it back. You can even lose a business and get it back. But time is irretrievable. On a daily basis, learn to identify your big time waster activities by taking a proper record of activities you spend your time on and try to eliminate activities that are not yielding or contributing so much to your business. One effective way to determine where you should spend more time is the 80/20 rule (also called the Pareto Principle). The 80/20 rule basically says that 80% of your results come from 20% of your efforts.
2. Be organized. Have a To-Do List
As a small business owner, you need to stay organized to a fault. Your mode of organization doesn’t matter as much as actually being organized. Start right away and keep it up. You can employ the habit of having a To-Do list to keep you on track. With a To-Do list, it’s very easy to manage and track your day to day activities including that of your employees. Craft your To-Do list with three categories in mind, one for items you have to get to that day, and a second for things that need your attention but can wait. Make the last category for minor tasks and responsibilities that you can knock out when you have the extra time.
3. Hire for attitude. Train for skill.
We live and work in a world where survival of a business depends on employing people who will do whatever it takes to keep costs low, quality high and continually be on the lookout for new ways to add value to the business customers. Even in the most technical jobs, skills are only half the package. Many businesses have made the mistake of hiring for skill rather than attitude under the assumption that they can re-engineer any bad attitudes through sophisticated training programs. Don’t get me wrong, if you need to recruit a technically qualified individual, make sure they have the basic technical skills required for the role but also ensure the individual’s attitude towards everything is right and culture fit.
4. Delegate tasks when necessary.
One of the best management tips for small business owners is to learn to delegate tasks that can easily be handled by a team member. More specifically, let go of control over things you’re not good at. Do what you’re the best at, and lean on others to help you with things you don’t like to do. Effective delegation starts with a desire to offload some of your work so you can focus on growing your business. Delegation doesn’t come naturally for many small business owners. It’s a complete change of pace from what most business owners do during the startup phase.
5. Invest enough in marketing
Marketing is expensive but at the same time, it’s undeniably necessary. As a small business owner, you likely don’t have the budget anyway. If you want your business to grow, you absolutely need to invest in marketing it in some way. And if you don’t have many marketing dollars to spend? Don’t worry there are plenty of marketing tactics you can make use of that won’t blow your small marketing budget. If you have a great product or service, word of mouth is a great marketing approach, but it’s often not enough on its own. You can solidify it with other proven digital marketing strategies such as Social Media Marketing, Content Writing, Search Engine Marketing and many more.
6. Set realistic goals and targets
In business, it’s critical to define where you want your business to be in the next 5 to 10 years and set realistic goals to help you get there. With goal-setting comes transparency and team alignment on these goals. The best way to keep an eye on the big picture is to set concrete, quantifiable and realistic goals and check in regularly to make sure that you’re moving in the right direction. Your goals may reflect a certain number of customers served, a certain number of products sold, or some other measure of success. Perhaps you want to expand to a second location – that’s another goal that you can track.
7. Keep track of your books
Track everything – It is very important to learn to stay on top of your financial books as often as possible as this will give you a good idea of where your business stands (money-wise) and help you make the right financial decisions when necessary. A great way to do this is to invest in an online accounting solution to help you keep track of all your business financial transactions (both revenue and expenses). Regular reviews are essential for long-term growth planning, so it’s a good habit to get into early on. Of course, it’s never too late to undertake the habit of regularly reviewing your finances.
8. Separate business & personal finances
Mixing business money with your personal finances is a recipe for unexplained losses and tax-headaches. Always keep your personal and business finances separate. This entails getting a business credit card and putting all related expenses on it. Keeping your business’s money separate will make gauging profitability easier and help you to keep proper track of your expenses. You will also do well in opening a savings account dedicated to your business, wherein you can transfer a certain amount of money from each payment that you receive and gradually build a considerable corpus. You can use this money to pay taxes.
9. Make sure you’ve enough capital
A business without a funding source will flounder under the weight of its own debt. Lack of adequate funding and capital is one of the reasons why 80% of new businesses and startups fail in their first year of operation. Most small businesses tend not to have enough capital to get themselves through the startup phase. To prevent this, make sure you have at least one or two years of runway saved up in the bank. If your savings can’t afford the required business capital you need, there is also an option of seeking funds externally through government grants, angel investors, loans and many more.
10. Build solid, lasting business relationships
Your network is your net worth – the best business leaders and executives understand this fact. To be successful in business, you need to build relationships with a wide range of people, including investors, peers, employees, and of course customers. Unfortunately, people who are great at inventing things, and have high creativity, often don’t have strong interpersonal skills or interests. Learn to spend time with your most important customers, your most productive employees, and leaders who can make the most difference to your organization. These relationships will generate returns in the immediate future and in the long run.
There’s nothing more annoying than a business owner or manager who doesn’t know how to manage. Small business management involves wearing many hats and keeping your focus on many different tasks. These tips can help you stay focused on the most important aspects of your business and keep you on the road to success.