Five Steps to Establishing Your Business

1) ESTABLISHMENT

Your business is being created.  Everything seems fun and new at this stage but in most cases money is tight. This is a time to be creative in getting known and a time to find your feet in what you do. Usually this stage is when the owner does everything all the time. Sadly, many businesses close when the start up money runs out, so the key is to keep overheads and expenses to a minimum. Spending money on sales campaigns and business listings is unwise as they seldom produce the desired results. 

Establishment Problems: 

Cash flow, marketing and gaining new clients.

Establishment Tips:

• Only use free business directories
• Use all free online listing options
• Pitch either with a cheaper version or premium version
• Network with other businesses 
• Create strong relationships with existing clients 
• Start with a free website, blog and hosting 
• Open a separate bank account for your business 
• Reconcile your bank statement 
• Prepare monthly financial reports 
• Don’t use debt 
• Use technology and social networking sites
• Provide excellent customer service at all times 
• Find creative ways to get into your local newspaper
• Be honest 
• Create a contact database.

2) ENDURANCE

Your business is trying to survive. Few businesses make it past this stage but those that do realise that this is the time to have specific direction, possibly finding a niche. At this stage you need to work smarter not harder.  You only have twenty four hours in your day like everyone else so see how you can maximise your time through time management and by developing systems.  It is essential at this stage to start working on the business and not in it or else you will never leave the endurance stage.

Endurance Problems:

Tiredness, overworking and being discouraged.

Endurance Tips: 

• Prepare and use cash flow forecasts 
• Get to know your competition 
• Run regular stock takes 
• Manage your time 
• Stick to working hours, don’t overwork 
• Accept card payments 
• Set up a referral system 
• Invest in personal hobbies 
• Remember clients’ birthdays and personal details.

3) EXPANSION

  Your business is growing. This is when you are able to take on staff members and offload some of the workload that you are not particularly suited to. It is essential to choose staff carefully and not rush into it. Having the right people on board will be hugely beneficially to your company. 

It is worth investing some of your time in learning about people or hiring someone who specialises in people before appointing your staff. The right people come motivated and are passionate about the business. As Jim Collins in his book Good to Great says, “Great vision without great people is irrelevant.” A great team will not only help you get the work done but they will also help you figure out how to get the work done. Synergy is essential. This stage is critical as it could cripple the business if handled poorly. 

Expansion Problems: 

People, people and people.

Expansion Tips: 

• Get the right people on your team
• Create a strong business culture
• Talk and listen to employees 
• Check employee references 
• Invest your time in learning about people 
• Invest in your people 
• Document your processes and streamline your systems 
• Employ people with skills you don’t have 
• Delegate, delegate, delegate.

4) EXISTENCE

Your business is succeeding and to get to the next level you need to ensure that you are managing your business with precision and excellence. Your staff are settled and your client base is consistent. The big question at this stage is whether or not to expand or to keep the business running in this comfortable and profitable place. Franchising your business could be a possibility as well as acquiring smaller businesses in the same field so as to buy out the competition. The possibilities are endless and so are the risks.

This may also be a stage where you need to confront the brutal facts. People, products or processes might be holding your business back. What changes do you need to make to get your business to the next level? Flip Flippen of the Flippen Group says, “No organization can rise above the constraints of its leadership. It is therefore imperative that leadership at all levels be constantly growing beyond their constraints.” Existence Problems:  Poor leadership, strained systems and denial.

Existence Tips:

• Work on your constraints 
• Asses the business and confront the brutal facts 
• Lead with questions not answers 
• Beware of de-motivating your team 
• Pay people to do the things you are not good at 
• Merge with or acquire another business 
• Expand globally 
• Diversify or simplify 
• Get efficient through technology 
• Utilize intellectual property 
• Competing in markets dominated by big brands.

5) ESTABLISHED

Your business is recognized and accepted. You can finally put your feet up on your desk as your have achieved a successful business. The business is growing and it is mature. Although all businesses require constant effort, you most certainly have something to celebrate at this stage.  Clear communication of the vision and a good relationship with your team are crucial at the stage.  As the saying goes, it only takes one rotten apple to spoil the whole barrel.  

To stay ahead you need to be innovative and not get too comfortable in your success.  In the beginning of your journey your business was built on your skills and talents but now it’s time to use other people’s skills and talents to get your business to keep moving forward.  Established Problems:  Complacency, competition and lack of change. Established Tips: 

• Stay focused 
• Stay disciplined 
• Keep your team disciplined 
• Don’t look at past success, create new challenges

September 25th, 2012 - Posted & Written by Angela De Souza

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