Starting and running a business, whether it’s online or offline, can be the best thing or the worst thing you’ve ever done. It requires a lot of hard work, intelligence and perseverance to run a successful company that turns a profit and stays in business. It’s a job, only you’re the boss and you’re responsible for all the good things that happen, as well as all the bad things.
While there are FAR too many aspects to running a business that can be covered in this simple guide, there are some basic things to keep in mind as your business starts to grow. Be prepared for these things and some of the unforseable things might be a little easier to handle.
If you want all the nitty-gritty details or need more guidance, consider getting my book. It’s full of useful information and helpful examples.
Be Prepared for Long Hours
It’s easy to romanticize owning a business. After all, it is the American dream. But it’s not all fun and games and you’ll be working a lot of hours. Of course, if you’re like most entrepreneurs, you won’t mind the long hours.
In fact, shutting down and stopping work for the day is often a real challenge. There’s always one more thing to do and it’s easy to keep going until you can barely keep your eyes open. If you don’t love to work, you better learn to because the success of your business depends on it.
Find a Mentor or Coach
Finding someone who can remain objective and give you honest feedback is invaluable. It’s easy to succumb to group think when you’re starting a business and having an outside opinion can often save you a lot of wasted time and painful headaches. Contact your local SCORE office or SBA/SBDC for experienced mentors, or contact a startup coach (like me) for more hands-on, industry specific guidance.
Pay Your Taxes
Hopefully, you took my advice in the Starting Your Startup section and hired a professional CPA (accountant) to do your taxes so this shouldn’t be a problem. However, if you’re being stubborn and insist on doing your own taxes, most first-time business owners don’t realize they have to pay estimated taxes on their earnings each quarter. Don’t let your tax bills pile up. Pay them quarterly so you don’t have to pay fines and penalties for being behind.
Be Customer Focused
One of the first things to suffer when a company becomes successful is customer service because it’s hard to offer the same level of service to thousands of people as it is to hundreds of people, or fewer. You’re going to be competing against other, more established competitors and the best way to compete is with excellent customer service. Make that mindset part of your business philosophy and strive to make every customer happy.
Set a Reinvestment Goal
Once your business starts generating revenue, it’s going to be really hard not to take a distribution and spend it on that trip to Paris that you’ve always wanted to take. You’ve been working your ass off and you deserve it, right?
Hold on just a cotton pickin’ minute! The sign of true maturity is delayed gratification. Take your spouse or friends out for a celebratory dinner, or take a less expensive trip, and save the extravagant rewards until you can pay for it without taking a distribution for the company. Instead, reinvest that money in the business to further growth.
My book covers your reinvestment strategy in more detail, but here’s a few things that can have high rewards: hire more sales people, increase your marketing budget, add new features to you website, automate time-consuming tasks, etc. Reinvestment may seem boring right now, but it could mean a much larger reward in a shorter period of time.
Find Office Space
If you started your online business at home and it’s doing so well that you need to move out, congratulations! You’ve made it over the first hurdle!
Don’t break the bank on office space, though. Having the coolest office in town isn’t as important as having a functional office that doesn’t eat up your budget. Find a centrally located space that meets your needs today and has a little room for expansion.
Outsource the Mundane
Once your new online business is generating some excess revenue, it might be time to start outsourcing some of the mundane tasks that eat up your time. Your goal is to work ON the business; not IN the business.
Here are some responsibilities you might want to outsource: customer service, PPC campaign management, SEO management, social media management, cleaning, bookkeeping, etc. Unless it’s the core of your business, you shouldn’t be working on it once you can afford to pay someone else to do it. Learn how to delegate!
It’s a lot easier to outsource self-contained tasks like PPC and SEO management. It’s not as easy to outsource core business functions. At some point, you may need to hire in-house staff to help out.
At QuoteCatcher, we hired sales and account management staff to work in-house because we found it was much more effective to have everyone under the same roof. Some were contractors and some were employees. Conduct at least two interviews, call at least two references, and pay for a full background check. Hire slow and fire fast.
Be extremely careful when hiring contractors because there are guidelines you need to follow or you could be severely punished for misclassifying a contractor when they should be an employee. Check with your state labor department for the rules.
Being Audited (Yuck)
If your business takes off and you start earning a lot of revenue (and paying a lot of taxes), the government will take notice, especially if you have employees. When that happens, there’s a good chance you’ll get audited by one or more state and/or federal departments. They like to pick on, I mean, target web based businesses because it’s easier for us to bend the rules.
If that unfortunate day comes, hire a good business lawyer, get all your ducks in a row and try to get through the process as quickly as possible so you can get back to working on your business.
Being Sued (Yuckier)
If you think being audited is bad enough, just wait until you get sued. QuoteCatcher experienced both! I once heard a CEO say that you’re not running a successful business until you’ve been sued. Once you’re successful, people will notice and some of them will want to take what you have.
Unfortunately, our legal system is designed to not only enable this to happen, it encourages it to happen. If it happens to you, hire great lawyers and do your best to get through the process as quickly as possible. It’s not personal (usually)…it’s just business, and it’s the cost of being successful.
Define Your Exit Strategy
You may think it’s too soon to start thinking about an exit strategy, but knowing your plan for the future can affect decisions you make today. You have 3 options for your exit strategy: close up shop, sell to a bigger fish, or go public. All three of these are covered in detail in my book so check that out if you want more info.
If you read my book and you have a business partner, you should already have this planned out and documented in your partnership agreement. If not, spend a little time thinking about it so if the big fish swims by, you know what to do.
That brings us to the end of the Running Your Business Guide. The tasks on this list are ongoing and they’re only a small subset of your business ownership responsibilities. Hopefully, your business takes off and you have to worry about things like hiring decisions, office space and reinvestment. That’s the good kind of stress.
You’re probably not quite ready for the next guide yet (if you’re reading this one for the first time), but if you’d like some motivation and inspiration, head on over to Living The Good Life >>