If you own a business you know a little secret: starting anything is harder than keeping something going. Getting the first is a real challenge. It doesn’t matter whether it’s your first customer or getting your first employee. Once you get past zero it starts getting easier.
Build your systems from day one.
If you’re starting a new business or you’re starting a new division start with building systems from the start. You’re going to have to do it anyway. You might as well spend some time thinking about what systems you’re going to need. I know this is probably not what you want to do, but if you want to be successful and grow you’re just going to have to do it.
Too often new businesses don’t have systems in place that allow employees to figure out what to do. As you figure things out, like how you deliver service or make a sale, write it down. Documenting what you do will make it easier for you once you start hiring employees.
Documented processes will save you lots of time training new people. You’ll be able to short cut the training process and get back to doing what you need to grow your business.
Start with a perfect customer in mind.
If you’re starting from zero you don’t have any legacy customers. Most established businesses have lots of them. A legacy customer is someone you wouldn’t have if you were to start your business today.
Many times legacy customers exist because the business owner never thought about what a perfect customer was before they started their business. Older businesses have these customers and they just don’t know what to do with them. Wouldn’t it be nice if you could skip this part of growing your business?
It’s easy to avoid as long as you think about who your perfect customer is. You can do this.
Understand what getting an adequate return is.
Learn the language of business, which is finance. Learn to read a profit and loss report, and learn how a balance sheet and cash flow statement work together. Start with having goals and hurdle rates (required levels of profitability) for your company.
In the beginning your business might not get the return you want. If you don’t know what you need for financial success you’re likely to never get there. Approximately 75% of the businesses in the US don’t cover their cost of capital. You don’t want your business to be one of them.
Know that innovation is part of the game.
You will want to have a process in place for developing new products and systems. If you don’t always develop new products and services you will eventually find yourself competing on price. If you’re a small business and try to compete on price the big companies will eat you for lunch.
The only way to maintain adequate profitability in your company is to make sure that you continually innovate. If you are developing better solutions for your customers that are focused on their needs, you’ll be able to charge more. It’s that focus that will allow you to create something that will add value to your customers.
The choice is yours. The more you concentrate on doing the right things when you move from zero to one, the more success your business will see. Are you willing to take just a few extra minutes and do the right thing?
I’ve written a case study on key financial metrics. This case will help you understand why knowing what you should measure will help your company deliver the profitability that you need. To get this report, click on the button below.