This is a guest post by Greg Pare. Greg is a financial coach and workplace trainer in Lubbock, Texas.
What is it about small business that attracts potential owners? Is it the promise of working for yourself and making your own hours? Is it the thought of capitalizing on a great idea? Or is it the vision of making tons of money?
I have had the privilege of starting and owning two small businesses. Like anything you do in life, you learn by doing, learn by making good choices and learn by making poor choices. While I still own both businesses, I am really enjoying managing and growing the second business that I started 18 years after starting the first business.
So, in a sense I have become a student of myself. While I have done some things similar in the two businesses, I have also chosen not to repeat decisions and would like to share some do’s and don’ts for small business owners, particularly those in the idea stage or infancy.
As a financial coach which happens to be the second small business that I currently own, I feel obligated to start my list of suggestions from a money perspective.
6 Steps Toward Financial Wellness For Small Business
1. Avoid debt – I started both businesses by saving for my start-up costs. The last thing that a new business owner needs is the pressure of having to make loan payments. What happens if the business gets off to a slow start? There simply isn’t room for error when you have the stress of facing loans payments. When you do, you may not make the smartest decisions that will benefit the business in the long run. Instead, snap judgments are made in order to meet the demands of looming payments.
2. Buy Used – Stretch your start-up budget by purchasing used. You don’t have to have the top of the line furniture, copier, phone system or computers to get started. Grow into newer updated equipment as you can afford to. Save from the profits of the business and pay cash for those nicer items as you can afford to.
Other non-financial suggestions are important, but may not put the business at risk if you make poor choices. You can usually overcome a bad decision if recognized and corrected.
3. Hire Good People – The least expensive help is not always the best, nor is the most expensive. I have found that in small business, you must make your employees aware of company goals and individual goals. Allow employees to set their own goals within reason. Offer incentives to them when they reach goals. Remember, that if they are reaching their goals, they are helping you reach your goals, and you should reward them for that. In addition, it is your job as the leader and owner to give them the proper tools to help them reach their goals.
4. Be Prepared to Work – I don’t know many small business owners that don’t work hard, especially during start-up. Being able to set one’s own hours is one thing, but ultimately it is your business that suffers when you don’t work. No one will take care of your business like you will. After time, can you expect to be able to take time off when you desire. Of course, but that is after much hard work to put yourself and your business in position so that you may.
5. Continue to Grow – Successful people are eager to learn. You can learn by reading, participating in professional growth opportunities, and collaborating with like-minded business owners. If you are reading this blog, you are at least looking for ideas and wanting to learn. You must make time in your business to allow for growth opportunities. Otherwise, you and your business become stagnant.
6. Pray – This should be at the top of the list. Remember that we have been blessed with the ability to make choices. We have been blessed with talent of some kind. The choices we make and how we use our talent are a direct reflection on our faith and trust in God. He has given us the responsibility of using our gifts and making decisions. As far as resources, whether it be money or other worldly possessions, they are His anyway. We should be taking care of them in a manner that is pleasing to Him. So small business owners should be called small business stewards. We are simply taking care of what God has given us to take care of.
Even though these few suggestions seem fairly simple in nature, they are sometimes hard to follow because we get caught up in the frenzy of running a business. Take your time, grow slowly without debt. Hire good people and work hard. If you are passionate about what you do, others will be too. If you are simply chasing dollars and not your passion, your small business will own you, instead of you owning your small business.
What small business advice do you have?
Greg Pare’s passion is helping others succeed financially. He is Dave Ramsey’s Referral Coach for West Texas. Greg lives in Lubbock, Texas. In addition to coaching, he owns an electronics installation company. Follow his blog at www.gregpare.wordpress.com and visit his website at www.gregpare.com. You may also follow his posts on Twitter @gregpare.
Photo Credit Jeff