Your first year in business is one of the most exciting and stressful as a business owner. There are countless things to consider and risks to weigh as you prepare to open your doors. However, regardless of your business size or industry, there are a few key questions that you need to answer. Consider these five things as you become a small business owner.
1. How will you fund your business?
There are many ways to fund your new business. Startup companies can seek venture funding from investors who believe in their ideas or secure a loan from a local bank. You can also “bootstrap” a business, or pay to run it out of pocket.
There are many pros and cons for each other these. While investment funding and loans can give you the startup capital you need, you have to pay dividends and fees over time. Bootstrapping is harder, but the money you make is all your own. Consider your different funding options as you develop your business plan.
2. Do you have the right insurance if something happens?
Even the most prepared and knowledgeable business owners can face unprecedented challenges to their operations. A hurricane can tear through your town and destroy your business, a pandemic can hit and force you to close your doors during a lockdown. Any of these natural disasters can be a huge ht for a small business. During this time, you can turn to your insurance company for help.
Along with property and business disruption insurance, make sure you have a public liability insurance policy. Public liability insurance covers any claims made against your company because of its products or services. A good policy can save you considerably in the long run, whether you’re facing a complex event like a pandemic or any type of personal injury incurred on the premises of your small business.
3. How will you measure your success?
Most entrepreneurs have big picture goals for success, whether that means staying open for the first year or hiring staff because they have scaled their operations. However, there are also small metrics that you should track to make sure your business is growing at a healthy rate.
For example, you can use event driven architecture to track the number of customers who visit your website and fill out lead generation forms. You can strive to grow the percentage of leads that become clients from your site. By setting micro-goals through complex event tracking, you can stay on track and hit growth milestones throughout the year.
4. What are your core values?
A company is only as strong as its core values. What do you value in your customer service and employees? For example, if your core values are trust, transparency, and community support, consider how you would build trust with your customers and employees. Think about how you can give back to the community. A company with strong core values can attract top workers who want to move the organization forward as best as they can.
5. How will you maintain your work-life balance?
Running a business is a marathon, not a sprint. You need to step away from work for a few hours every day and for a few weeks each year. During this downtime, you should rest, play, and generally recharge away from the office. These breaks can increase your longevity and help you return to work sharper and eager to move your business forward.
David Finkel, author of The Freedom Formula: How to Succeed in Business Without Sacrificing Your Family, Health, Or Life, recommends taking at least four vacations a year — one per quarter — to recharge and get ready for the months ahead. These vacations should last at least a week and fully allow you to step away from the workplace.
By answering these questions, you can set your business up for success. You can prevent burnout and make sure you are secured financially to overcome any hurdles to your business operations.