Many people dream of starting their own business but launching a start-up and turning it into a long-term success are two different things. One in five new businesses fold within the first year and half fail within three years. There are major challenges that face every business owner but, with the right amount of planning, determination and just a little luck; the rewards can be great.
It’s crucial to start on the right footing. A great idea or unique niche is an advantage but you will still need to pore over the details and draw up a thorough business plan – not least to allow you to secure vital funding. Mainstream banks are one option here but many new businesses still face difficulties when trying to secure a loan from the high street banks.
Another option may be a specialist business lender operating in your area. When looking for start up business loans Harlow and other East London start-ups could try companies such as; Foundation East. Organisations like this can prove to be extremely useful because as well as providing vital funding, these organisations can also provide mentoring for new businesses.
Manage the cash
The exact challenges you may face will depend on the individual business but managing cash flow is an issue familiar to most small businesses. Research by the Federation of Small Businesses shows that 73% of small businesses have experienced late payments within the previous 12 months. This is an all too common practice but you can help minimise the effects by instituting clear contracts and a structured invoicing system.
There might also be times when you require additional extra funding once the business is up and running. An overdraft can be useful for dealing with short-term cash flow issues but a further loan might be better for longer term investment.
It’s also important to strike a balance between expectations and an often harsh trading reality. There may be times, due to prevailing conditions or circumstances beyond your control, when it’s all you can do to keep the business afloat. At the same time, you don’t want to miss a chance to expand and grow when you have the chance. Be realistic but be ready to seize the day if and when the opportunity arises.
With these hints and tips in mind, surviving your first three years in business will be easy!