In 2015, 60 percent of small businesses stopped operating within the first three years, according to the Australian Bureau of Statistics. The main reason for this is poor cash-flow. It’s an alarming statistic, especially since 97% of all Australian businesses are small. Fast forward to 2018 and sadly the numbers haven’t changed as much as we’d hoped.
There could be many factors for this:
- Bad idea and the lack of market research – all businesses start as an idea. We all have wild and unique ideas and many entrepreneurs succeed because they believe in the idea, studied and worked hard enough to produce it.
Therefore, thorough market research is important before you bring to fruition the idea that you want to take into business. Ask yourself these questions:
- Do I have time to do it?
- Am I passionate and driven enough to do it?
- Do I have the funds?
- Do I see this long term?
2. Lack of capital – this is self-explanatory. As mentioned above, thorough market research is required before you dive into business. You should think long-term and not just for a year. If you only have sufficient funds to last a year, then you’re not ready for it yet. You also need to have a back-up plan … and one thing you should absolutely avoid is using your entire life savings as your back-up plan.
3. Lack of proper training – when starting a business, you have to have the right reasons why you’re doing it. It always starts with you and is then down to the people you hire. You must also be able to learn from your mistakes. Mistakes are inevitable and necessary for you to learn, but you mustn’t dwell on them. In the words of the great Winston Churchill, “Defeat is never fatal. Victory is never final. It’s courage that counts.”
4. Don’t have the right team – it’s important when you’re hiring that you have the right team working with you. They must have at least a year’s experience, the right attitude and you as the employer need to keep them happy and create a great working environment.
Don’t expect an employee who always get a late paycheck to come in to work on time or have the right attitude to face your customers! First you need to take care of your employees and your employees will take care of your customers. Happy customers equals good business.
5. And last but not the least, you are doing everything yourself! – multi-tasking is actually doing yourself more harm than good, especially to your brain.
According to an article in Entrepreneur, “That’s heresy in a time-urgent world with the attention span of a macaque on crack. Meyer admits that multitasking is not only getting more prevalent, but it’s also “very often highly inefficient and can be dangerous to your health.” Even the most adept multitasker will “crash and burn” trying to resolve simultaneous conflicting demands, Meyer says. That means you could wind up sending the wrong e-mail; blow an account; have a “brownout,” in which too much access to the cerebral grid shuts down critical thinking; or worse, find yourself in a truly hazardous situation, such as driving while using a cell phone.”
Learn to delegate tasks to your VA and focus on more important things in your business.
So how do we keep small businesses competitive and profitable?
Paul Magiatis, a successful property developer and a business owner who runs 5 micro businesses with offices in Australia, Hong Kong and Cebu in the Philippines, shares his tips on how to keep small businesses competitive and profitable:
- Keep a very close eye on your cash-flow and cost-base. It’s going to be tough, but those businesses who survive will be bulletproof by developing strong process efficiencies.
I believe activity levels will stay dormant in the next 12 months due to market confidence. So reduce your cost-base to become efficient and stay in the black.
2. One of the smartest things I ever did was employ an offshore marketing team to lower my cost-base while increasing my output and productivity.
I hired a virtual staff member to do the back-office admin tasks for me while I focused on building my businesses, networking and spending time with my family.
Sometimes we rely so much on ourselves and we think we don’t need help, but we do. So focus on more important ‘business building’ tasks and let your virtual assistant/staff do the admin, client follow-ups and appointment setting for you. They can do anything that doesn’t need to be physically ‘touched’ in the office … there’s almost no limit to the tasks they can do.
1. Communicate daily with the people who work for you and invest in proper training.
2. Address issues immediately. Procrastination is the real enemy.
I’m sure you’ve read many tips and words of advice about how to keep your small business growing and flourishing. One things for sure, don’t be afraid or too proud to ask for advice. Also, learn to relax and give yourself time to think … meditate. Exercise and eat healthy.
If you have questions on how virtual staffing can help you and your business, take it from an expert, contact Paul.