By Krzysztof 'Kris' Garlewicz, President of ProsperiFi.
Build, sell, repeat. This has seemingly become the dominant strategy recommended for entrepreneurs today. While rapidly launching a business they can sell might work for some, what about those interested in building a business they can keep? Businesses are built for more reasons than selling at first opportunity. Owning a business can be a chance to build something tangible, express yourself and create a long-term investment. Rather than take aim for the exit, build a business you can keep with these nine habits for fueling long-term company success.
Getting Financially Fit
A surprisingly high number of entrepreneurs are clueless about their own financials. Running a business involves a lot of moving parts. And perhaps chief among them is tracking income and expenses. Delegating this to a bookkeeper is fine, yet it's recommended to become at least somewhat familiar with the process yourself. A well-kept financial record creates a record of business value. It's also crucial for making intelligent projections about business growth.
From infancy to maturity, entrepreneurs often pivot their business to where they see growth over time. Is your business growing each year intentionally or are you simply treading water? Proprietary concepts, technology and techniques can create opportunities for business growth. Picture your business five years from now. Locate opportunities for growth and develop strategies for capitalizing on them. With intelligent projections on-hand you'll be able to answer when opportunity knocks. Remain focused to execute on the opportunity and pivot as needed.
Establishing Autonomous Operations
Companies able to operate independently of a single person or entity are generally better suited for the long haul. Relying too heavily on a single manager, employee, supplier, etc., is risky. If the person or business becomes unavailable, it can affect operations and revenue. Creating established processes, finessing them for efficiency and promoting them among employees can help contribute to autonomy. The right processes can also help save time dedicated to training new employees and increase workplace safety.
Adopting A Profit-First Mentality
Perhaps counter-intuitive to what most entrepreneurs have been told, placing profit first can help promote growth. Rather than following the standard formula (subtracting expenses from sales for a profit), change the math. Dedicating a set amount to profits means subtracting profits from sales for a leftover amount, which is then used for expenses. This may be new territory. Yet a growing number of entrepreneurs have reported experiencing successful growth utilizing this method.
Developing Recurring Revenue Streams
Sales are a necessary part of creating profit. Recurring sales help establish predictable and steady profits. Selling a job at a time or doing one-off projects can pay the bills yet leave the future unclear. Creating quality sources of recurring revenue such as memberships, licenses, maintenance and more can help businesses sustain for the long term. To start, check around your industry and see what's working for other business owners.
Leaving A Unique Footprint
A unique service, interesting product, proprietary technique or other special something can help set your business apart. Companies with something more to offer can generally better draw customers in and maintain viability. Find what makes your business special and use that to grow.
Measuring Satisfaction Metrics
There's more to customer satisfaction than an online review. Employee satisfaction should also be a target, as good employees can be difficult to replace. Utilizing numbered scoring methods, promote the completion of questionnaires by staff and customers. This can help judge satisfaction and highlight areas for improvement.
Implementing an Advisory Board
Pooling talent and brainpower by implementing an advisory board can give your business a leg up. An advisory board brings new thoughts into the fold and is a great way to get feedback about decisions before taking action. There may be additional tax advantages to having an advisory board as well. They can help steer the company, promote autonomy and much more.
Creating Owner Freedom
For many entrepreneurs, releasing control over part or all of the business can be challenging. And that's normal. After all, your business is something you've worked hard to build and maintain. To help give your business the best chances for success, step back far enough where the business can carry on without direct owner involvement. Dependency on the owner robs the business of its autonomy, which can hinder efficiency.
Owning a business for the long haul can be hard work and a challenging experience, but for many, the reward far outweighs anything else. Adopting these nine habits for fueling company success can help steer your company toward long-term success.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
Krzysztof 'Kris' Garlewicz is President of ProsperiFi, designing custom wealth strategies for high performing entrepreneurs and executives.