How to Kill Your Small Business or Startup

Here are just some of the fastest ways to kill your small business or startup:

- Building something no one wants or that you can’t sell at a profit 

- Inadequate business planning 

- Lack of clarity or focus

- Hiring poorly

- Failure to ask for help

- Ignoring social media

- Lack of appropriate financial accounting and internal control practices

- Spending too much money and/or being underfunded

Unless killing your dreams is actually your goal… you must be asking “How can I avoid these things??”… read on 

1) Are you trying to sell something people don’t need or aren’t willing to pay (enough) for?

Before you ever start a business... the first thing you have to do is extensive early market research and testing. If, in your product or service's earliest stages, you aren't seeing conclusive proof that people want what you intend to offer, and at a price point you can profit at, it's best to keep working on it before investing in a full launch.

2) How comprehensive and complete is your business plan?

Ever heard the saying... ‘a failure to plan is a plan to fail’? When it comes to a comprehensive business plan... this is absolutely true. Many new entrepreneurs fail to appreciate the need to engage in a thorough business plan process. They ‘fly by the seat of their pants’ and in a lot of cases... have no idea what they don’t know. Until... they find themselves in a bind later down the line. Planning ahead for every conceivable scenario IN ADVANCE and then continuing to use your business plan as an active tool to stay focused and on course is absolutely vital to long term success. 

3) How clear is your vision and how focused are you on your goals?

This goes back to your business plan which is vital... but it’s more than that. It’s the ‘bigger picture’. It’s ‘your why’. It’s the vision you had when you started. But did you ever take the time to really flesh out every aspect of your vision? Did you set clear and attainable goals to start? Have you updated your goals as you have achieved them? If you haven’t done this work - you will never realize your full potential and it is likely that you will fail in trying. 

4) Hiring the wrong people. 

Many new entrepreneurs have no idea who to hire or how to go about it. Many have never hired or managed others before. This is a whole area of expertise that you will have to become familiar with as a business owner. But don’t be disheartened... there’s a science to it. It starts, though, with clearly identifying the role/job description you need to fill. Then there is an important step many businesses fail to take - which is to clearly identify their company culture (or begin to build one) which is based on your core values and your vision - and then figuring out what type(s) of individuals best ‘fit’ into your culture and your vision. Before you can even begin looking for someone to join your team... you have to know exactly what you’re looking for. (Yay! More planning!)

5) Failing to ask for HELP! 

Oh this is one of my favorites! Look around you... small businesses make up the vast majority of our commerce and support our amazing American economy. Small business, while it is a daunting adventure at the beginning... is not a new thing and there are a wealth of professionals out there just waiting to assist you. ((PICK ME!)) There are also networking groups and professional development resources (free and paid) that you can take advantage of. Do not go it alone... tap into the knowledge base of people that inspire you. Stay connected to people and groups that will educate, encourage and help hold you accountable. There is absolutely no need to try to reinvent the wheel as a business owner. 

6) Social media - do I have to?!

Yes. You have to. I admit... I have been a little behind the curve myself. It’s a bit daunting but it is the way we connect in this modern age. Spend the time. Get acquainted with it. Learn about the various forums, formats, tools... and get started. If you’re truly overwhelmed or unable to wade in on your own, there are plenty of people and services out there that are educating business owners on the subject (again, free and paid). Find resources, make a plan, get busy. CONNECT. 

7) Financial accounting and internal controls. 

Unless you are an accountant or financial planner, it is likely that this topic does not excite you. That’s quite alright but it doesn’t mean it can be put on the back burner for ‘when I’m making money’. Part of your business plan will be financial goals. In order to meet those goals you will need a means by which to account and report your current status and be able to compare it - real time - and proactively to your goals. There are a number of other very important reasons why you MUST have a proper system of accounting and internal controls... such as tax planning, avoiding fraud and theft, preparing for future capital funding needs, etc. Suffice it to say, you MUST have a proper system in place to assure your success. 

8) Spending too much money or being under funded. 

This goes back to both the business plan as well as the need for proper accounting and internal controls. Without these things in place at the very beginning... you are almost certain to over spend or be under funded. Or both. When it comes to money and business, you really have to be a proactive planner and a good steward. Think of money, particularly in the beginning, as a vital resource for your success. You have to spend it in order to make it. You need to know how much you need, how much you have, where the rest it is coming from, and how you will ultimately pay back borrows funds. Then you need a budget to adhere to so that you remain solvent while your venture grows. With the right strategies in place and given proper attention to executing those strategies... your business will grow and so will your bottom line. 

Contact us today to discuss sBs Growth Coaching™ and Consulting options for help in developing a strategy to avoid the common pitfalls of startups and small businesses. We can help you chart a course for success that will be sustainable and will grow as your business grows. Don’t go it alone.

https://www.s-b-services.com/get-started

#ineedhelp #sbsgrowthcoaching #businesscoaching #businessconsulting #startups #smallbusiness

Common Accounting Mistakes in Small to Mid Sized Businesses

(These principles often apply to fledgling nonprofits as well…)

Accounting doesn’t just involve keeping the books for tax purposes... it’s also a very important mechanism for saving money and identifying waste, fraud and theft. That's why it's so important for business owners to hire professional accountants instead of trying to do the books themselves or delegating the work to inexperienced staff members. Even successful companies can quickly and easily go broke because of accounting mistakes that result in unpaid taxes, fraud, theft or embezzlement.

Accounting mistakes can include basic math errors, entering data incorrectly and failing to document expenses and income. Here is a list of the 5 most common accounting mistakes that we see. 

Organization (or Lack Thereof)

Organization is critical in accounting and record keeping practices. Having a system that works is key. This means using a business credit or debit card for expenses, keeping receipts, ensuring the books are up-to-date, keeping track of petty cash expenses accurately on the day they’re incurred and absolutely not mixing personal and business finances.

As a busy business owner, it is probably common for you to pick up supplies while doing your personal shopping and errands. This can be efficient, however, it’s essential to get separate receipts for business related purchases. Although expenses under $75 generally don’t require a receipt, I always recommend that you get one. In an audit situation, when you can show receipts for all your expenses, auditors are less likely to challenge them. One of our accounting clients recently had an IRS audit and not only were they found to be 100% correct in their bookkeeping but they were also complemented on their super clean record keeping... a simple system that was designed by our firm and that they have consistently practiced for years.

Getting Behind on Paperwork

Business owners often wear many hats and are frequently guilty of putting off doing the books until the end of the month-quarter-or longer... not realizing the vital importance of a timely bookkeeping function. This is a risky strategy because it's easy to get behind on financial statements, reports that need to be filed, such as sales tax or payroll tax filings and payments, vendor bill payments and even billing customers for money that they owe you.

Delayed customer billing can result in mistakes on invoices and lower collection rates in general which will directly affect your bottom line. You could be liable for penalties and interest for filing important reports and payments late... and even lose out on big financial opportunities all because the books aren’t current. If you have to struggle or rush to catch up on your books, it's significantly easier to make costly mistakes. 

As a personal example, I really dropped the ball on the simple yet sometimes overwhelming task of processing the mail for my most recently sold enterprise. I intended to find a professional to handle the closing out tasks but failed to do it in a timely manner. But let’s face it - that business was gone and it wasn’t fun thinking about it any more. I was off to bigger and more exciting things! Before I knew it the piles were HUGE! It’s been costly in both time and penalties now for my lack of timely response to a necessary business function. Take it from me - timeliness, especially with the un-fun things, is absolutely critical. Delegate if you have to but get it done.

Hiring the Wrong Person for the Job

If the person in charge of doing your books doesn't know what they are doing, you are the one who ultimately pays for the errors. No employee, relative or friend is going to worry about your books as much as you or a professional accounting company will. The other risk of hiring someone who is not a professional is that the person could easily embezzle funds or steal from you. I’ve seen it time and time again. You think it won’t happen in your organization but trust me... it can and it will.

Being Unwilling to Delegate

Business owners are often unwilling to delegate their bookkeeping to experienced accounting professionals.... whether it’s because of price-point concerns, a misguided feeling that outsourcing is not a secure solution, or just simply not realizing the inherent risk of not having it done properly and in a timely fashion... yet business growth depends on the critical leadership ability to let other professionals handle anything outside of your business core competencies.

Simply put, you have to be willing to let other people do their jobs while you do yours. You need expert advice and an experienced accountant to maximize your income and minimize taxes and other expenses in order to be as financially successful as you can be. 

Poor Systems of Communication

Poor communication between you and your bookkeeper can result in serious mistakes or omissions in your records, report filings, and can result in everything from impossible to reconcile statements to inaccurate financial data. It's easy to forget that you paid someone a bonus in cash or gave a cash discount unless you have a system with which to document it and convey it to your bookkeeper. 

If you want to keep the most profits from your sales and expenses, you need to utilize an experienced accountant or bookkeeping service to handle your books the right way and help you avoid errors, find savings, and uncover business opportunities based on your financial picture.

In Summary -

An organized system of record and bookkeeping, communication, and internal controls will help save you from the pitfalls of costly accounting mistakes. 

We can help you design and implement a system that works for your unique business or organization. 

Contact us today to discuss sBs Growth Coaching™ options for help with creating a road map to success and using task management to break down that map into actionable items that will lead you to your goal.

https://www.s-b-services.com/get-started

#motivation #businesscoaching #ineedhelp #sbsgrowthcoaching