Have you started up your business? If you want to be in business in the next three years time you will have to implement sustainable business processes. A lack of planning is a key reason many start-ups fail. Here are 8 steps you need to take to establish your start-up to improve performance and reduce risk.
1. Buy Accounting Software
Getting the right accounting software is crucial for your business. Get an accounting package you can load budgets and forecasts. Your accounting software will enable you to track your income and expenses accurately and you will be able to track performance against your projections, allowing you to make decisions faster.
2. Start Credit Check Potential Clients
Many small businesses still do not credit check their clients, it is too risky in working for a client that may not pay you. Most banks provide their business clients with a subscription service, invest in one as soon as possible.
3. Respect Payment Terms
Make sure you get paid for your sales as soon as possible. If you have payment terms over 30 days you should consider changing it to 30 days or less if possible. Ideally, you should get paid for your goods/services before you pay your creditors.
4. Chase Your Creditors
Chase all outstanding debts from your clients that have exceeded your payment terms. Every small business should have a procedure in place to deal with aged debts. Start off with a friendly reminder, warnings should escalate upwards to senior management. If this fails you should seek legal advice.
5. Get Feedback From Customers
Ideas and collaboration drive improvement and innovation. Every small business should try to interact with their customers. Find out what they like about your business, what you could do better. Use this information to improve your products/services and overall business.
To increase participation offer your customers an incentive to take your survey.
6. Monitor Your Competition
Competitive analysis is a continual process, not just for your business plan. You need to analyse what your direct competitors are doing and try to stay ahead of them. Scan your market, find out if there is a new entrant or is a competitor struggling.
7. Keep Track Of Your Contracts
Keep track of all of your long-term contracts, revenue and expenditure and plan for possible alternatives several months in advance. This will help put you in a position of strength in negotiations.
8. Understand Your Staffing Requirements
Is your business slowing down? Think of what your staff demands will be in the future, you may need to negotiate a reduction of hours with your employees.
Your business should not be too depended on any employee, including you. Develop a succession plan, your business should be able to survive without you or another key member.
Whichever of these options you choose to make immediate improvements to your business you need to remember that business improvement is not a one-off exercise, it has to be done continually. It is important for you to make time to time to plan a business improvement plan and assign different members of your team tasks to help you make improvements and drive change. Monitor performance monthly and adjust the plan as things change.
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