Discover insights and lessons around running a successful business.
If you ask small business owners what they’d do differently when starting out, you’d probably hear “a lot.”
Running a small business inevitably teaches owners many lessons about growth and effective business operations. Thankfully, you can learn from their experience and insights as you’re starting out.
Here are 12 tips from experienced small business owners that can help you in your endeavors to grow and run a successful business.
1. Don’t quit your day job just yet
It’s a common trap to fall into when someone is excited about turning your idea into a business — they rush to quit their day job only to have the money run out and business fail.
According to Forbes, Spanx founder Sara Blakely didn’t resign from her day job as an office equipment salesperson for Danka until she was absolutely sure her small business idea would work. It took 2 years, but learning to work with minimal sleep is what led her to turning her form-fitting shapewear idea into a well-known brand.
“There were days that I’d be at Danka all day and the semi-trucks would drop boxes of Spanx outside my apartment … I resigned on October 14, 2000. I quit Danka and two and a half weeks later I was on the Oprah Winfrey Show,” Blakely says.
2. Do what it takes to avoid distractions
When everything is going smoothly for your startup, you may get the urge to shift focus on bringing your next big idea to market. That’s what founder and CEO Jayson DeMers told Brian Honigman when his Seattle-based content marketing company AudienceBloom took off. It didn’t take long for him to regret the decision.
“Running a company ‘just fine’ is not what an entrepreneur’s job is,” DeMers says. “Successful entrepreneurs don’t do the minimum for their company; they constantly work to grow it, evolve it, and prepare it for the future. Because I was splitting my team between the two startups, growth stalled at my first company, and I didn’t have enough time to dedicate to the new startup to make it successful.”
Although his second venture didn’t make it, AudienceBloom did continue to blossom, and DeMers has since focused his full attention on it.
“I learned that a successful venture requires 100 percent attention, focus, and effort. Secondary ventures need a full-time manager or else they’ll just distract you and derail your existing efforts if you aren’t careful.”
3. Protect your business legally
Starting out as sole proprietorships makes it easier for small businesses to start selling goods and servicing clients quicker. But being a sole proprietor comes with a lot of risk. It just takes one person to make a legal claim against your business for you to experience a significant loss of personal assets.
A limited liability company (LLC) is also another popular business structure. Establishing an LLC helps protect your personal assets from business liability and lawsuits, because your business assets are the only thing at stake if you were to get sued.
Another way to protect your business assets is to have business insurance in place. Check out liability insurance and worker’s compensation options from Zenefits partner The Hartford.
4. Have separate business and personal expenses
Fun fact: Some business credits cards don’t report out to consumer credit bureaus, which means they don’t impact your personal credit. And it pays to separate business from personal when it comes to most financial accounts, including savings, checking, retirement and more.
Why? It comes down to taxes. Keeping things separate makes it easier to pay your taxes and organize your expenses if you get audited. Not to mention, it’s more professional to use a business account for things like paying vendors or employees and even reaching to investors for funding.
5. Document, document, document
If you’re lucky, your business will grow, which means onboarding new employees, new responsibilities for existing employees, and evolving roles within the company. This growth happens a lot more efficiently if you have processes documented.
Software tools like Creately can be helpful in mapping out business processes and documenting them for your employees to access.
6. Put your business plan in writing
Would you invest in a business without plan? Neither would your investors. That’s why this is the most necessary tip for starting a small business. Your business plan is essentially your roadmap of where you’re taking your business, and how you’re using your available resources to get you there. Include things like:
- A description of your company
- Your organizational structure
- The products or services you offer
- Your sales and marketing strategy
- Profit and loss estimates
Even if you’re not going to be working with investors, a solid plan can do your business a lot of good in the long run. For example, a mission statement can impact how potential candidates perceive your company.
Your business plan is essentially your roadmap of where you’re taking your business, and how you’re using your available resources to get you there.
7. Don’t go overboard on designs
Although a business plan is necessary, it’s important to avoid a “grand design” that is broken down into smaller steps.
It’s a common misconception that you need every part of your business plan executed in order to start your business. What you need is the smallest part of the plan that needs to be implemented to start making money as soon as possible.
For example, a grand design would be to take a pizza franchise to all college campuses in the U.S. It’s a very ambitious goal, but it has to start with one location first and make that a success.
8. Rely on the experts
As a business owner, it’s hard to take a hands-off approach, which means it’s very easy to overextend yourself. If you’re a CPA running an accounting business, you’re probably not going to be successful running your own marketing efforts. A good takeaway tip to remember is once your business making money, stick to what you know and hire a professional for everything else.
9. Lead with customer service
When your Amazon package is running late, you’re notified of the delay. When Chick-fi-la gets your order wrong, you’re likely getting a coupon for free nuggets. You need to set the bar just as high, if not higher, when it comes to the customer service side of your business.
Think of the best customer service you have received. It’s one of the few things you can easily replicate without a huge budget. It just takes effort.
10. Don’t bet the farm
Starting a small business is risky, and there’s a good chance the business fails. There will be times when you make decisions, like an expansion for instance, that doesn’t pan out.
That why’s it’s important to never bet the farm. In other words, choose to take calculated risk. This way, financial fallout from failure doesn’t leave you with nothing. As Jeff Bezos says, “I don’t believe in bet-the-company bets. That’s when you’re desperate.”
11. Take care of yourself
As a small business owner, you’re likely too busy to eat or sleep, much less exercise or simply relax. But if you did hit pause to get a full 8 hours of sleep or take the time to eat healthier, you’d likely feel more focused and be more productive.
The small business tip to take care of yourself is also a personal tip.
Keep a daily task list of things to do for yourself alongside your to-do list for the business. It’s a helpful reminder to go to bed by a certain time, stay hydrated, and choose the side salad over the fries.
12. Celebrate your wins
It’s easy to get wrapped up in the next big project as a small business owner, and it’s not uncommon for milestones to pass by without a champagne toast.
A good small business tip is to take the time to celebrate. Whether it’s a nice dinner or happy hour at the office, it’s important to reflect on the work that’s been done and how far your business has come.
And don’t forget to include the people in your life that are happy for you when you succeed and those that helped get you where are. If you have employees, your milestones are their milestones too. Be sure to celebrate them with a reward to show your appreciation and let me know they’re part of that success.
Bonus tip: Remembering what to do — and what not do — as a small business owner can feel overwhelming. Focus on one tip a month and work to make it a habit. Next thing you know you’ll be a complete new business owner.