7 things I wish I knew before starting a small business

Selina Bilton

21.01.23 | 5 min read

7 things I wish I knew before starting a small business

Starting a business can be one of the most exciting adventures you pursue in life. The benefits of running your own business include being your own boss, being responsible for building your own dreams and developing the flexibility to schedule work around your lifestyle. Making work, work for you. However, for that new endeavour to succeed, it’s critical that all owners set themselves up for success from the beginning.

Almost half of all new businesses stop operating within their first four years. For reasons, including a lack of market need, problems with cash flow and losing to the competition.
So, starting a new business requires careful planning and investment, consider the following tips so you can get off on the right foot:

1. Know your future

This is quite an obvious tip, as without a plan, your business has no hope for longevity.
Whatever size your business is, you need to create a business plan that will detail how you will tackle the challenge ahead.

Your plan should include your mission, your goals, the opportunities you’ve identified, established measurable goals and a clear vision for your future.
Having a strong plan in terms of what you’re going to do and how you’re going to do it, will help avoid serious problems in the future. Remember that while it's important to have a plan, it's equally vital to be flexible enough to pivot when needed.

2. Know the competition

Before you start a business, do your research. Find out about your competition, marketing platforms, industry trends, customer preferences, whatever you think may give you a competitive advantage. Remember, things in the business world change constantly, so it is important to stay up to date with your industry.

Market research is an essential part in establishing a successful business, for example:

Do you need a physical location and if so, where?
Will your location influence who your competitors are?
Will the location you choose deliver a unique set of customers with a unique set of needs?
Does your location offer an opportunity that another may not?

To be successful, you are going to have to continually research. You are going to have to actively increase and update your knowledge on changing trends in the market, new competitors entering the market and changes to customer preferences. To be successful, you are going to have to be ahead of the curve.

3. Know your customer

Knowing your customer is critical to your business’s success. Many businesses stumble because they fail to understand or identify their target market.

Will you talk to your customers daily?
How will you engage in marketing through channels such as social media and email?
Have you thought about how to make your audience feel important, valued, and desired by your business?
How will you become their first choice when they need a business like yours?

By regularly keeping the pulse of your customers and potential customers, you will be able to pivot and stay ahead of the curve as preferences and trends change.

4. Know your budget

The importance of proper financial management is essential in ensuring business survival in this highly competitive climate. A budget can help to ensure long-term success for your business, it can help you see past the next week, month, and year. It can help to make sure that you’re spending money in the right places and at the right time.

For those new to budgeting you should be taking stock of your current finances and how much you are planning to invest. From there you can move on to calculating the current costs (fixed and variable) and starting to estimate the monthly sales of your business. As most businesses tend to run at a loss in the initial phases of set-up, budgeting correctly should allow you to predict at what point your business will start to turn the almighty profit.

Remember to always ensure you have a little financial cushioning to carry you through any unexpected rainy days.

5. Know your brand

Your brand is the identity and the heart of your business. It’s essential to develop a strong brand so that both your existing customers and potential customers know what you’re selling and want to purchase it. Getting your brand right is critical because this is what your audience will think of when they think about you, so make it something worthwhile.

Building a brand is about creating trust. When you live up to your word and your customer’s expectations, you will create brand loyalty and an increasing series of loyal customers. These customers will also be more likely to recommend you to other potential customers through word-of-mouth.

The current market is inundated with businesses all attempting to steal customers away from each other, so make sure your brand stands out from the other competitors in the market.

6. Know your networks

People like doing business with people they know, so get networking.

Whether this means attending conferences, joining industry associations, or signing up to online forums, meet as many like-minded people as you can. The more people you connect with, the more exposure you’ll get for your business.

Until you’re an established business, you will need to act as your own brand ambassador, promoting the benefits of your business and demonstrating how you can make a real difference in the industry. The connections you make today could one day lead to your next customer, ambassador, mentor, or business partner.

7. Know your balance

Starting a successful business requires a huge amount of time and energy. It's important to find a balance that supports the growth of your business and the growth of you as a person.
To protect your work-life balance, be sure to set boundaries, avoid the need to constantly be doing stuff and be present with others when you are not working. Your business can’t run without you. So, it’s crucial to take care of your own health and well-being.

Find ways to maintain perspective and preserve healthy relationships outside of work. Good diary management will allow you to grow a successful business, as well as preserve time to be active, and catch-up time with friends and family. These relationships will help to recharge your batteries and inspire you to persevere as you dream grows.

Bonus Tip - Know who you can go to for help

Just because you're starting a business, doesn't mean you have to be an expert on everything. If you're not an accountant or bookkeeper, hire one (or both). The time and money you waste trying to do things yourself could be better spent on the areas you excel in.