Running a business
How to run a successful business
No-one ever said that running a business is easy, but being your own boss and doing something you love each day can be extremely rewarding.
So what are the key things to remember when running your own business?
Have a plan
Remarkably, some people start a business without a well thought out plan - perhaps inevitably, they don’t get very far. Effective planning is a vital, on-going process for all businesses. Careful planning will keep your business on track by giving you a roadmap and timetable towards achieving your goals. It will tell you what you need to do and when - on marketing, product development and finance. Don’t start without one, and once you have it, don’t put it away in a drawer. Time invested in planning is never wasted.
Surround yourself with great people
In the early days you may not want to or be able to employ staff, but trying to do everything yourself can prove too much. Make sure you have suppliers, manufacturers and contractors you can rely on. And when you do need to recruit, concentrate on putting together a balanced team. Take on people who have the skills you lack and make sure you communicate clearly with them. It’s easy to forget that you live and breathe your business and probably know exactly what's needed to make it successful - but it’s up to you to communicate your vision clearly to your team.
Know who your customers are and where to find them.
Marketing is about creating a reputation for your business. How do you want your business to be perceived? What messages are you trying to get across? What is the value and benefit to your customers? Do you know who you are going to market to? Decide how you’re going to tailor your message to make people listen. Where are you going to find your customers? Make sure you know how to reach them so that you focus your marketing effort where it really matters.
Don’t forget to plan advertising and PR
Don’t be afraid of being creative to get your message across. Listen to feedback from your customers, act on it and always respond to their needs. Ultimately, your success at winning and keeping customers determines if your business succeeds or fails.
One way of establishing credibility with your customers is to position yourself as an expert in your field - start a blog, write a book, give presentations. You may find that you quickly become the ‘go to’ person in your field. Be passionate about what you do – your customers will pick up on this and be drawn to you and your business.
Keep your customers happy
Make sure your service or product offers consistent value. Don’t forget – it’s far easier and much more cost effective to keep the customers you already have than acquire new ones. And satisfied customers tell others – make sure your customers are advocates for your business. Focus your efforts on your most profitable customers and look after those who regularly place large orders, pay on time and who are low maintenance.
Be continually on the lookout for new markets and distribution channels. Do you know other business owners who might be interested in forming joint ventures to help you both reach new customers?
Tell everyone what you are doing
Although it's important to tell your existing and prospective customers what’s happening in your business – don’t forget your family and friends. Your business can’t succeed if no-one knows what you’re doing. Social media is an easy and effective way to spread the word – why not start with those closest to you?
Learn how to sell
OK, so you have a great product or service, you have a plan and a marketing strategy. Now you have to persuade people to buy. Some business owners are natural sales people, but many find the idea of selling uncomfortable, to say the least. If this is you, get help or training to overcome this stumbling block. Your business cannot succeed if you don’t manage to sell your product or service.
Once your sales strategy is working well, consider how you can maximise the profit on your sales. Can you offer a premium product or service? Can you add features that give your customers more value at little cost to you?
Network as much as you can
Like selling, the prospect of networking can make some people feel uncomfortable. But networking events can be an invaluable way to spread the word about your business. Prepare well before you attend an event. Practise saying what you offer in a couple of sentences and make sure you have a stock of business cards. But avoid the hard sell at all costs. Remember – you are making contacts which may lead to business in the future. Email people you connect with within a couple of days to say how much you enjoyed meeting them and perhaps send them some information that can help their business - you now have an established contact.
Keep a close eye on your competitors
Know who they are and what they are up to so that you can stay one step ahead. Compare your price and quality with those of your competitors. Consider offering better value for money by adding extras such as after-sales service, free installation or bundled extras.
Keep a very close eye on your finances
In the early days you'll probably want to keep the amount of money going out of your business to a minimum. Borrow if you must, but make sure that you don’t over-commit yourself. If you're selling products, make sure you manage your stock carefully. Start small to avoid overstretching yourself and make sure you continually monitor your stock so that you know what’s selling and what isn’t. Be continually on the lookout for opportunities to reduce costs to make sure you stay competitive in the long term. Don’t forget to invest in equipment, systems and training which will improve efficiency and help you make the most of the resources you have.
Focus on profit
All too often business owners focus too much on building market share and increasing turnover. At the end of the day, the only thing that will prove that your business is succeeding is if you have more money coming in than going out – ie, you are making a profit.
Concentrate on your most profitable income streams
This may sound obvious, but many businesses either don’t know or aren’t interested enough in where they are making the most money or from whom. Try to set up passive income streams so that you have a steady flow of income that requires little or no effort from you - allowing you time to grow the rest of your business.
Focus on your short, medium and long term goals and ensure your day to day activities take you closer to achieving them. Organise your time, staff and finances carefully and regularly review what you are doing. It’s all too easy to get bogged down in daily minutiae and lose sight of the bigger picture – make sure this doesn’t happen to you.
Comply with legislation
Employment, health & safety, tax and data protection laws must be adhered to. If you’re not confident you know the laws relating to running a business inside out, make sure you use professional advisors to help you.
Don’t give up!
There will be times when you feel despondent, frustrated and exhausted. If this happens to you, remember why you went into business in the first place and focus on strategies to move you to a better place. If you're struggling, get help from the wealth of local and online organisations that exist to support people in business and use them to help you get back on track.
Don't forget to celebrate your successes!
Guides to running a business - Santander Bank, Clydesdale Bank
Running a limited company
Running a small business
UK Government guide to running a business from home, sale of goods and services and data protection
Acas guide to employing people