Having a great business idea and wanting to see it take shape in the form of a new company is one thing, but do you have the business know-how and an understanding of basic business principles to back it up? In other words, have you done your due diligence when it comes to gaining some insight into the financials or studying comparable business models to give your company a chance for success…Below are a few important business principles that apply to pretty much any small business owner.
Understanding cash flow. A primary reason for a business failing: not understanding how much is coming in versus what is going out, until ultimately, they have a serious lack of cash. Very often this occurs because they failed to plan accordingly. Have a handle on the expenses; know the numbers.
Think lean. You may be making a profit but that doesn't necessarily mean you have any real cash on hand. And again, this is only going to sink your business before it even gets off the ground. Try and avoid accruing expenses that aren't 100% necessary. Always be thinking lean.
Culture and mission matter. This often gets overlooked but defining what type of company culture you're going to have and its subsequent mission is essential to truly move forward in a meaningful way. When it comes to recruiting talent even, they want to know what you stand for, that they are working for a company with solid values.
Know your customers. And not just via email. Talking face to face with people is huge for a new business. This will enable you to more effectively gather feedback and thus get a real sense of how customers feel you are doing on the whole.
Know your competitors. You want to know what you are up against. Understanding their strategies and approach to marketing, for example, can only help yours. You can even set up Google alerts for competitors so you can better stay on top of their next moves.
First Union Lending would love to help you get your small business moving forward! Call today to see how our business loan programs might benefit you.