Starting a new business is an exciting time in an entrepreneur’s life. Hopefully, everything goes well and the company will begin to make money. Sadly, the reality is it will be a bumpy ride before money starts coming through the door. The “What Percentage of Businesses Fail in their First Year?” post puts the figure at 20%. So, there is an 80% chance the business will survive, but the statistics are only for the first year. Within ten years, 96% of startups close the shutters. So, the question is, how does an owner not fall at the first hurdle?
Deal With Taxes
Startups need to lower their expenses – fact. And, because it takes a while to turn a profit, reducing costs can help keep a company in the black. Out of all the charges on the table, the tax is the most significant. Usually, tax contributions for SMEs can take up over 20% of the firm’s budget. The problem lies with businesses which don’t hire professional help. An article entitled “What can Maryland do If I owe taxes?” points out the dangers of doing it yourself. Due to their skill and experience, accountants are essential to the process. Hiring one costs money yet makes money in the long-term.
Increase Customer Base
The customers who kept you in business last month won’t do the same again. The reasons range from a lack of loyalty to companies needing to maintain a healthy influx of buyers. In simple term, consumers purchase products and services and spend money in the process. Although it may not be a fortune, it is often enough to keep an SME in business. The more customers who make a purchase, the more money a small firm is likely to make. Plus, an influx of new customers is an advertisers dream. Therefore, it increases the opportunity of alternative revenue streams.
Recruit Reliable Employees
Firstly, a company’s workers are the difference between success and failure. As they are the lifeblood of the organisation, they keep the business running. Logically, then, employees have to be productive and driven. More importantly, a recruitment mistake can cost a startup a fortune. Not only do you have to pay a worker off, but you also have to stump up for a recruit. And, the cost doesn’t even factor in the process of interviewing and paying recruitment agencies. A tip: look past their resume. Often, a person’s personality will tell you whether they’re a perfect fit.
Invest In Insurance
It’s tempting to see an insurance policy as a waste of time. For the most part, it’s money which never bears fruit. So, many small businesses decide not to invest in multiple coverage options. Unfortunately, when there is an issue, these companies are vulnerable. Insurance isn’t an ROI type of investment but a contingency plan. Should there be an issue, the policy will cover the costs. Seen as small firms don’t have a lot of cash flow, it can be the difference between staying open and shutting down.
If you’re ready, on your marks, get set, and go!