7 success tips for young entrepreneurs

1 Make proper plans Consult existing business contacts, read market research reports, walk the streets and bounce your ideas off people who know your industry.

Once I’d done that, I went out and tried to “buy” my proposed service offering from potential key competitors. No one could provide what I had in mind. So I worked on the financials and then factored in worst-case scenarios.

Remember: if no one provides what you are offering, there might just be a reason for it.

2 Beware professionals Accountants, lawyers and bankers all have a part to play in growing your business. But they’re not entrepreneurial gurus. You have to make your own decisions.

Double check professional fees (usually quoted per hour) and always how many hours are involved so that you can establish what it will cost your business. You can often reduce accountancy fees by using industry-recognised software packages.

3 Maintain good housekeeping How fast do you process orders (customers generally won’t reorder until they have got their current pending order)? How quickly do you invoice?

It never fails to amaze me how many businesses take literally weeks to issue an invoice for products or services long since delivered. This is just free credit for your customer.

Do you know your sales ledger backwards? If not, study it. A sale is not a sale unless the customer has paid for it, so chase up those late payers. If you run out of cash, your business will run out of steam and collapse.

4 Beware the armchair punditsThe classic “armchair pundit” is the football fan who sits watching the set on a Saturday afternoon critiquing the manger for what he has and hasn’t done.

Becoming an entrepreneur means you will be subjected to similar such armchair pundits. And they could well include your own employees.

Be confident in what you are doing. Listen to others, let them argue their case about what they are saying but don’t lose your nerve.

5 FundingMany entrepreneurs fall into the trap of using funding to build up large inventories of products they don’t need, and for which they have to pay warehousing.

Keep stock levels to the minimum viable amount. Remember that stock equals tied-up cash. Talk to your bank about overdrafts and project-specific loans, then shop around for the best deal.

Think about factoring invoices and consider remortgaging your commercial property if you own it, or securing a loan from friends or family.

6 RecruitingBefore going out to recruit, write a clearly defined job description. This will help you to conduct better interviews and portray a more professional company image to both local recruitment agencies and interviewees.

Don’t be rushed by an agency to choose a specific candidate, and keep asking to see more candidates if no one inspires you.

Don’t overpay for someone who has had excessive big-company experience. They may well be a fish out of water without the big budgets and office support that they are used to.

Successfully advertising a product with a budget of zero requires far more intelligence, skill and flair than doing so with a budget of billions.

7 Don’t underestimate the power of sleepWe have all heard the slogans such as “breakfast is for wimps”. Take no notice. Eat a healthy breakfast, do some exercise and get a decent night’s sleep. You’ll be far more productive. For more about Simon Tate, founder of Kew Health & Beauty (www.kewhb.com), click here.

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