How to get through your rocky first year in business
8 min read
09 January 2014
Every new business venture will present multiple challenges for the founder/s throughout its journey to success. Unfortunately, they will crop up when you least expect them to, and no matter how much risk preparation you have primed, there will always be surprises – so expect the unexpected!
Each entrepreneurial journey is different and although there is plenty of advice available for starting your own business and getting it up and running, there is little to follow this and support the owner through the toughest period a business will ever see – its first year.
Although it may seem as though you are through the worst once you have carried out thorough market analysis, created a SWOT (strengths, weaknesses, opportunities, threats) evaluation and prepared your business plan, there are plenty more trials and tribulations to come.
Having made it through the rocky first year in business myself before building a successful and steadily growing company, here are my top tips for ensuring you survive the first hurdles you’ll face in your newly launched business:
Get your staffing right
I firmly believe that the most important element of a successful and profitable business is the people. The people make a brand, the people are the ones delivering excellent customer service, and it’s the people making sure that customers get exactly what they’ve paid for.
Sourcing the best staff is crucial and it’s important that you set out exactly what you need in order to further the business, by choosing a team of people with the right skills and attitude. It is worth assessing whether it would be more cost effective to outsource some processes such as recruitment, since a specialist can help you find the perfect fit in terms of skills, attitude and culture.
When recruiting, figure out what key tasks they will be undertaking in their day-to-day processes, and set them a realistic task in a timed and controlled environment, so you can see how they are likely to perform. However, when giving tasks such as these, bear in mind that the candidate is under unusual stress so they should be given some leeway on this.
Prepare for the unexpected
During your first year, you will no doubt encounter challenges you will not foresee coming your way. You can prepare for the unexpected using thorough risk assessments and ensuring that you are expecting something to come your way. It’s not a case of knowing what’s going to hit you – no one has a crystal ball – but instead a case of making sure your business processes are robust enough to cope, should they take a hit.
For example, if your utilities fail for a day or if you encounter IT disruption, you need to have contingencies in place to cope with such circumstances. You can also prepare for the unexpected through expert advice, which is not only required to help set up a business, but you will find yourself needing support from time to time throughout your entire entrepreneurial journey, even if it is 10 years in.
Raise your profile
During the first year of business, it is critical that you build and raise a profile in order to gain and maintain customers. For the first year, you should totally engross yourself in industry events and be totally dedicated to networking. Attending every conference, awards ceremony, exhibition relevant to your industry may be time consuming and costly but the networking opportunities are rife and the people you meet will be invaluable contacts. These events will return investments.
Not only will this help you to build the name among the relevant audiences, but it will also enable you to create a strong and positive image of the company through being passionate.
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You should set SMART (specific, measurable, achievable, realistic, timed) goals for both your business and yourself, and re-visit these goals on a regular basis to ensure that you are on track. These should be short, medium and long term focused, and you shouldn’t be afraid to ‘dream big’ as long as what you’re aiming for is realistic. The problem many organisations face is that they set themselves unrealistic goals, which the business depends on in order to survive, and this just isn’t an optimal way to run a business.
You must set out how you will grow the business and never get lazy with the goals either – if you are over-achieving, re-evaluate your goals and make them even bigger.
Budgeting is essential, and you need to calculate how your finances will be distributed within your business. Renting office space can be one of the most expensive overheads so you should research the most affordable option for you. You need to ensure that you budget for absolutely everything, including the installation of IT systems, and speaking from experience, a back-up source of revenue is strongly advised.
Cost control is vital as it can be the differentiating factor between a business which booms and a business which dies. Late payments can be a real issue for example, having a knock on affect on cash flow. You must ensure that you stand strong against organisations and don’t feel bullied through the need for their business. You should also set up purchasing policies – you will be surprise how much money organisations are spending on the likes of office sundries, for example.
Take one task at a time
Time management is of the upmost importance – not just for yourself, but for your staff too. You need to have thorough plans for days, weeks and months and ensure that you take one task at a time. This will help you work efficiently and even though you may have 10 things to do at once, tackling them individually will be much quicker than attempting to tackle them all at once. Similarly, keeping a clean, tidy and cluttered free environment in which to work in will help with efficiency too.
You will no doubt come across challenges that will make you want to pull your hair out, but it’s important to realise that every new business goes through these moments. By taking the first step in starting a business and producing a stringent business plan to stick to, you’re already halfway to understanding that you will get through that rocky first year. Good luck!
Beatrice Bartlay is the MD and founder of 2B Interface