Number 1 – Cash is King
Positive cash flow is the lifeblood of a business. Without constant cash flow, the company is unable to handle surprises or reinvest for future growth. I have learned there are many ways to work within constraints instead of spending cash that may be needed later. Keep in mind, especially if you are a new business owner, your company is not a bank nor does it provide a cash float to customers.
Be mindful when you and your team start making excuses for purchasing items for the business or a new client project. When you hear the excuses, place the purchase on hold and then examine the justifications before proceeding.
Number 2 – Always Pitch New Business
Always pitch new projects or talk with potential customers or clients. One month your business is at capacity and then the next month it’s slow. Keeping irons in the fire ensures a full pipeline of potential new business. Growing a company is a marathon, not a sprint.
Number 3 – Cultivating Your Network
Growing and maintaining a strong business and personal network is essential. For the network to thrive, supporting others in your network by sending quality referrals is equally as important. Networking is building quality professional relationships with individuals and companies who genuinely support your products and services.
Number 4 – Keep Expense and Overhead in Check
My son, who is in high school has a lawn maintenance business which grew by 246% year-to-date. This increase was higher than he anticipated and I caution him on spending the surplus on unnecessary items.
I’ve been a business owner for eleven years and keeping costs reasonable is one of the most important things you must do. Knowing when to spend money and when to work within your constraints is a learned skill.
Number 5 – Know the Business ROI
I run an ROI for all business purchases. We discontinue any product or service that does not have a profitable return. ROIs applies to clients. If there is no profit, evidentially there will be no business.
Number 6 Pricing
Pricing for goods and services is another area that always presents challenges for businesses.
Calculate how much margin is required for profitability. Second, make sure pricing is consistent with the market. For knowledge-based businesses, remember always price your fees based on knowledge and expertise – not your labor hour!
Number 7 – Operate in Your Areas of Strength
Outsource business functions and tasks outside of your areas of strength to individuals or service providers.
Number 8 – Focus
Peter Drucker talked about focusing your efforts instead of multitasking. I used to multitask. Now, I write in a spiral notebook, two or three tasks that need to be completed.
For complex projects and when I am working on a book, I turn off email notifications and reframe from checking social media. Carlson Tate’s book – Work Simply is an excellent resource for discovering your productivity style and how to manage your time effectively.
Number 9 – Keep Family Advice at Arm’s Length
Family members may mean well. Keep in mind their advice may be coming from their fears or a dated version of how they remember you when in high school or college. Also, adding toxic family personalities into the mix creates additional stress. Determine if you need advice from family members, if not, keep the conversations to non-work-related topics.
Number 10 –Protect Your Most Valuable Resource
Your time. How we spend each minute of the day is our choice. Instead of allowing others to high jack our time, we can maintain our boundaries and say no when needed. One of my favorite quotes, “Your lack of planning does not constitute an emergency on my side.”
When we allow team members to be unprepared or talk too long about non-essential matters, everyone loses our most valuable resource – time.
What would you add to the list?