If the last two years have taught us anything, it's that society is pretty adaptable when necessary. As the world reeled from a pandemic, consumer trends shifted and businesses have had to keep up. One side effect of lockdowns and social distancing has been a steady increase in online businesses. While this trend was already going up, it's been supercharged since 2020. So, if you're an entrepreneur, now's the best time to capitalize on your passion and create a new enterprise.
That said, starting a new business ain't easy, no matter your experience level or expertise. There are so many variables that can affect the outcome, so you might find yourself overwhelmed by it all. Thankfully, you don't have to start a business by yourself - we're here to help. We've compiled a list of the top tips to ensure your new venture runs as smoothly as possible. Once you understand the challenges you'll face and how to overcome them, success is likely within reach.
So, with that in mind, let's look at the top tips and tricks for overcoming the hardest challenges when starting a new business.
Step One: Find a Mentor
While there's something to be said for blazing your own trail and discovering the best path toward success, this option is complicated and hard to navigate. After all, if you haven't started a business before, how do you know what to expect? Or, how can you overcome various challenges when you don't know the proper steps?
One way to overcome this inexperience is to find a mentor. Mentors can guide you through the toughest obstacles you'll face because they've been in a similar situation before. In this way, you can learn from their mistakes and benefit from their knowledge and insight.
But, how can you find a mentor? The first option is to use a mentoring service, which can pair you with a mentor who's aligned with your business needs. This option is convenient, but it can often cost extra because of the overhead involved. The other method is to reach out to people you know, such as other business owners, and ask if they would be open to mentoring you.
Mentoring is not a rigid process, and you don't have to schedule ongoing sessions with a mentor. In some cases, perhaps you just meet with the person one or two times to discuss specific problems you're facing. In other instances, you might schedule meetings to chat and build an ongoing relationship. The key is to be open and honest about what you're looking for and ask potential mentors what they'd like to get from the experience. As long as you're both on the same page, it's easy to reap the benefits.
Step Two: Be Honest About Your Capabilities
As a business owner, you have to wear many hats. You have to worry about customer service, operations, marketing, and many other duties. Even if you have employees for various positions, it's tempting to roll up your sleeves and do it all yourself.
Unfortunately, there are only so many hours in a day, and you can only work so much. Business owners will often put in the most hours, but they won't necessarily see results. It's almost always better to be strategic about your time and energy than to simply rack up hours. For example, you can accomplish more in 30 hours of strategic work than 60 hours of mindless labor.
So, when being honest about your abilities, you have to consider both your skills and the amount of time you can (and should) devote to your business. Here are some tactics you can use to dial everything in:
Start With the Essentials - During the beginning stage of your business, you need to focus on keeping the lights on before you worry about other options like marketing. Focus on the items that keep your company afloat, then add in extras as you go.
Plan Each Day - Ranked to-do lists can help you stay focused on the most important tasks while keeping everything in mind. Overall, you should be proactive, not reactive.
Use Productivity Software - Many apps and programs can help you organize your schedule and prioritize tasks. Test out several options to determine which ones work best.
Step Three: Set Up Your Finances With a CPA
The financial side of your business is crucial for building a solid foundation. If you don't know elements like your cash flow, profitability, and tax burdens, you're setting yourself up for big problems down the line. It's imperative to figure out your finances from the beginning so that you don't have to go back and fix mistakes later on.
While you could try to do it all yourself, it's much better to consult with a professional CPA. A CPA can walk you through the basics and ensure you get your accounting in order. Your accountant can also help you determine your tax payments, especially if you have employees. Ideally, you'll only need to use a CPA a few times per year to start. Then, once your business grows and becomes profitable, you can use an accountant to handle your business finances all the time.
Step Four: Consult an Attorney About Legal Needs
Regardless of your business model and structure, you'll have to worry about various legal situations. To start, you'll have to make sure to file your company paperwork with your state. If you're not compliant, you could wind up with massive fines and potentially lose your business registration.
Other legal concerns might include:
Intellectual Property - If you're selling proprietary products, you have to make sure no one else can sell knock-offs. You can also ask about copyrighting or trademarking your marketing materials.
Employee or Customer Lawsuits - You can't afford to wait for a suit to occur before you pay attention to your liabilities and responsibilities. Chatting with a lawyer can help you determine if any potentially hazardous situations might derail your business.
Step Five: Stay Organized From the Start
In many cases, business owners are very reactive, putting out fires and responding to various needs as they pop up. Unfortunately, this tactic leads to disorder, which can derail your business quickly.
So, it's much better to organize yourself from the beginning, even before you start selling anything. Write a list of everything you need to consider, then build organizational tools around each piece. Some examples include:
Tracking Income and Expenses - While meeting with a CPA can help you organize your finances, you also need a system for tracking your cash flow. For example, if you have to buy supplies on a company credit card, where are you keeping your receipts? How are you marking each transaction so you can figure out where your money is going? If you just label everything as "supplies," it's hard to know where you can adjust your spending.
Timekeeping - Even if you're the only person working at your company, you should still keep track of your time. While you don't need this for payroll purposes, it helps you visualize how much time you're investing in your business. If possible, break down your time into different tasks, such as "customer service," "bookkeeping," and "shopping."
Paperwork and Account Management - You'll likely have to work with various vendors and suppliers, so how are you keeping track of those interactions? Where do you put outstanding invoices, and where do they go once a client pays? What's the process for collecting an outstanding balance? Make sure to utilize a filing system, so nothing falls through the cracks. If you're dealing with physical paperwork, can you scan those documents and store them electronically?
Step Six: Find a Work/Life Balance
As we mentioned, many business owners log so many hours without seeing tangible benefits (at least right away). If you're working 60 or 80 hours a week, it's hard to stay motivated because you have so little else beyond your company.
Here is where organization and preparation can come in handy. If you're strategic with your workload, you can have more free time for yourself. If you're constantly responding to issues, it's virtually impossible to separate work and personal life.
If necessary, determine how much free time you want each week, then work that into your schedule. Over time, you'll get better about prioritizing yourself without hurting your bottom line.
Overall, challenges are a natural side effect of starting a business. It's how you respond and overcome those challenges that can make all the difference. With these tips in mind, it's much easier to build a solid foundation from which to thrive.