Business in Science and General Truth

Before starting a business there will be certain considerations to take into account, below you will find ten of these considerations.

1 The type of business you will be starting!

What type of business would you be starting up? Is it a start from scratch or is it a franchise? Or will you be taking over and already established business? The type of business you will be starting will lead to a lot of the other things that you need to consider.

2 Are you qualified to run this type of business?

Is it a type of business you need to have training and experiences first like a plumber or a hairdresser? Or if it’s a franchise will you need to do any further training through the franchise provider? What other training could you do that would help you run your business successfully? Have you managed a small business before? Or have you got a certificate in small business? Is there any other training that will be beneficial to your business, or business in general?

3 Do you have the finances or can you get the finance that is needed to start your business?

It is very important that before you start your business that you have enough money to be able to run your business for the first three months (at a minimum)as well as to cover the start up costs and any other costs that a related to this stage of your business, it is also a good idea to give your self an extra ten percent of what you think you may need to cover the unexpected. It is amazing at the number of businesses that start up without the amount of cashflow that is actually required. This amount varies from person to person, business to business.

4 Do you have the support that you need from family and friends?

Running a business is hard work, but the journey to success can be made easier with the support of loved ones, friends and family, even if it is just to give you encouragement when times are tough. It would be fantastic that if your friends who are already in business could offer you some advice and guidance in the some ways as a mentor. Or even just there to bounce ideas off.

5 The relationship that you have with your bank manager

This is very important especially if you are going to need help with number three financing and cashflow, but also because they are a good source of business information especially related to your everyday banking requirements.

6 Have a good accountant

An accountant that is good for someone else may not be so good for you, after all you have to take into consideration personalities, experience with your type of business and so on. You want your accountant to understand the industry you are in, or going to enter. You also want to be able to get sound business advice from your accountant. It is also very important that they know there job, and know what they are doing. They should be able to guide you into making the right decision as to the form you business will operate as, such as a sole trader, a company and so on.

7 Have a good lawyer

Same as with your accountant and your bank manager, you need to have a good relationship with your lawyer, after all your lawyer is the one that takes care of the legal side of your business. Some lawyers even do start up packages for small businesses. Your lawyer will also help to set up the business in the correct formate.

8 The form that your business will take!

Will your business be a sole trader, limited or public company, partnership, not for profit or something else? Getting advice from your accountant and lawyer is very important for this decision, after all they are trained and have experience and they should be able to tell you which is the most appropriate for your business.

9 Location

Where will your business be located? Why did you choose that particular location, is it central to they type of clients you will be wanting to attract? Do you have a back up location if the first one doesn’t work out? Will you work from a commercial premises or out of your home?

10 Business Plan!

Do you have a business plan? This is an invaluable resource to any business. It gives you an outline for your business, as well as giving your business direction. It also helps to focus you business so that you don’t try to do too much at one time.

I hope these things have given you food for thought, and you will take them into consideration when you are starting up a new business, franchise or taking over and existing business.

Growth is what it is all about. Companies that do not grow do not make money. There is a direct correlation between growth and making money.

Historically growth has most often been expensive and somewhat illusory hence the willingness to accept as much growth as fast as possible.

Anyone that has ever tried to grow a stagnating business knows how hard getting any growth can be so few can resist the lure of fast growth.

But there negatives associated with fast growth. Some businesses would be better off to avoid the temptation of fast growth and instead look at steady incremental growth: incremental versus exponential.

At this point the hope would be the owner would grow incrementally with the company.

A quick self assessment of where you are and where you want to go needs to be made. From this assessment you can determine your capability for growth as well as indications for the best strategy to take.

One characteristic of fast growth companies is that they have to make decisions at an accelerated pace. Often these decisions need to be made on the spot with little information. Mistakes are not allowed.

The key indicators here are what do you have in place right now and what will you need to put in place to complete your business plan.

The critical call on decision making is what will be the reliability of the company’s day to day decision making as it grows and expands.

During fast growth the status quo or “business as usual” is set aside and everything becomes stressed and strained. It is vital to your company that you have good decision making strategies and staff to carry them out.

Sooner hopefully than later you will have carefully reviewed your markets. If you markets show little opportunity there may be little chance for growth unless you diversify.

Look at your markets carefully and see if and where there are potential growth opportunities.

Growth industries are best but some declining industries offer growth opportunities as well. If your market potential is there, then proceed to customer value.

Look to what customer value you give and how that works in your competitive environment. Run that out on a timeline and attempt to anticipate your customer’s future needs.

Can you create enough value to generate a profit? Again, focus on the market opportunities for growth.

As with any business venture there is risk and fast growth comes with risks. The key is to identify these risks and determine if they are acceptable.

The biggest risk for fast growers is cash flow…do your growth strategy projections keep you solvent as you grow?

On some bank loan financial projections one is required to include available cash on hand column to guarantee liquidity. This is because sales don’t always mean growth and the temptation to grow quickly through financing is a trap that has caught many an unsuspecting entrepreneur off guard.

It is important to make these projections to insure the company will remain solvent and have enough cash on hand to meet daily and weekly obligations. Part of this juggling act is volume versus capacity.

Volume versus capacity is one of the trickiest juggling acts in fast growing businesses. Once you get the increased volume, can you handle it or will the quality of your product or service deteriorate making your business less competitive?

Can you meet the anticipated demand? If your sales slow, will your fixed costs be too high? Do you have to make changes in your business infrastructure and if so, what will that cost?

Employees and staffing are probably the fast growers biggest headaches. Fast growing businesses require employees that are focused and productive.

Fast growing businesses are a good deal more stressful, but also more challenging, rewarding and fun to some employees but too much work for others.

If you decide to grow quickly, assess your employees and see where each fits. You most likely will face the problem that not all employees are suited for fast growth.

Getting and keeping good employees is much more important in a fast grower…make sure your pay and benefits provide good incentives.

Growers grab for any advantage they can and technology offers a world of advantages. The idea is how to leverage technology to make your business more effective and efficient.

What are the technology costs and can your people do with technology?

The whole business attitude is different in fast-growers. There’s an excitement, thrill and upbeat buzz of activity, but not for all. Do your people see growth as stress or excitement?

Even though more fast growth opportunities exist than ever before, only a relatively small percentage of businesses are in a fast growth mode.

Run multiple scenarios so you will begin to understand the peculiar dynamics of fast growth so you can see if growth is friend or foe. Fast growth may in fact be for you, but look before you leap!