.png)
Image via Pexels
As rewarding as entrepreneurship can be, it takes a lot of hard work to start, run, and grow a successful business. About 20 percent of new small businesses close within their first year, and only 30 percent stay in business long enough to celebrate their 10-year anniversary. Some of the more common reasons companies fail include financial hurdles such as poor cash flow and bad spending habits, business management challenges — and amidst COVID-19 — failure to pivot.
While this is certainly discouraging when you’ve put all your time, money, and energy into pursuing your entrepreneurial dreams, following several best practices can help to improve your chances of business success. Here are five keys to small business success, according to LEO Digital Marketing.
1. Choose the Right Legal Structure
Choosing the right legal structure is one of the best things you can do for your business, as certain legal entities will benefit your company better than others. The most common types of legal structures include sole proprietorships, partnerships, limited liability companies (LLCs), corporations, and S corporations.
Sole proprietorships, for instance, are the easiest type of entity to form — but they don’t offer the same tax advantages or level of liability protection as LLCs and corporations. As a sole proprietor, you (the business owner), could be held personally liable in the event that your business is sued by a customer, supplier, or employee — while operating as an LLC or corporation would protect you from personal liability in this type of situation.
Moreover, fewer financing options are available to sole proprietorships and limited liability companies. LLCs and corporations are more likely to qualify for small business loans, but corporations also have a better chance of securing funding from angel investors.
That said, your business structure isn’t set in stone and you can typically change it at any time. However, it’s a good idea to speak with an attorney about changing your legal entity to ensure you’re choosing the best option for your small business.
2. Build an Eye-Catching Website
Every successful company needs a great business website, especially in the age of COVID-19. A business website is a place to share information about your products, services, and prices; connect with your customers; and reach your target audience — and creating one increases your company’s:
Credibility.
Professionalism.
Online and offline sales.
Online visibility.
Contact LEO Digital Marketing to learn more about how creating a professional website can benefit your business throughout the pandemic and beyond. The marketing experts at LEO can also help with other essential services such as branding, social media, search engine optimization (SEO), photography, and video.
3. Manage Your Business Finances
Many companies face financial challenges at one time or another, but how you manage your business finances plays a major role in whether your company fails or succeeds in the long run. If you’re not effectively managing your finances, you may run out of money, miss important payment deadlines, forget to collect payments from your customers, and acquire more debt than you’re prepared to repay.
Fortunately, lots of tools and apps are available to simplify the process of managing your small business finances, preventing cash flow issues, and paying off debt. Accounting software like QuickBooks and Xero are two great options for tracking sales, expenses, invoices, and bills, while OnPay, Patriot, and Intuit QuickBooks take the hassle out of processing employee payroll.
Additionally, you can use Plaid’s liabilities and loan API (application programming interface) to control your business debts and conveniently retrieve important financial information. Since Plaid products connect to thousands of different banks and financial institutions, Plaid Liabilities can be used to review the terms of your current loans and securely manage your credit cards, mortgages, and other business debts. You may even enable access so that your employees and other end-users can link their own financial accounts.
4. Get (and Stay) Organized
Keeping your small business organized is another best practice to follow, as good organization boosts productivity, saves time and money, reduces stress, and simplifies tax season. A few ways to organize your small business include the following:
Digitizing as many business processes as possible to reduce paper clutter, save space, and automatically back up your important documents
Use productivity tools and apps to simplify social media management, customer relationships, team projects, and emails
Update all software at least twice a month
Scan your computer for viruses once or more each week
About once or twice a year, check to make sure your files, photos, and other documents have been backed up to an external hard drive or cloud storage service
Keep track of your business passwords with tools like LastPass, Dashlane, or LogMeOnce
5. Never Stop Learning
To stay ahead of the competition, keep up with an evolving industry, and generate new ideas that can be used to grow your business, another best practice is to prioritize lifelong learning. Continuous learning builds confidence, boosts creativity, and makes you a better business leader.
One way to further your education and develop skills in areas like accounting, marketing, strategic planning, and corporate finance is to enroll in an online degree program from the University of Phoenix. A master’s degree in business administration (MBA) is a great option for entrepreneurs, but other fields of study include education, health administration, cybersecurity, and information systems. Online degree programs are perfect for busy business owners, as they allow you to learn on your own schedule.
If you’re not interested in furthering your college education at this time, there are some other ways to expand your knowledge without earning a degree. As a few options, you could listen to podcasts and audiobooks, volunteer in the community, or complete an online course on Udemy, Skillshare, or Coursera. The key is to find the right learning style for you, depending on whether you’re an auditory, visual, or kinaesthetic (hands-on) learner.
Follow These Best Practices to Succeed in Business Ownership
To keep your company afloat for many years to come, follow these best practices and your small business will thrive. Running a business is never easy, but these best practices will help your company to save money, stay organized, attract and retain customers, and improve its business operations.
Are you ready to improve or develop your company’s online presence? LEO Digital Marketing can help with everything from web design and social media to branding and SEO. Book an introductory meeting today or contact LEO to learn more.