Small businesses are a critical part of the Canadian economy, accounting for 97.9% of all firms in the country and creating 87.7% of all the new jobs. But it’s volatile and risky to start a small business. During the height of the financial crisis, 86% of small businesses failed, and in 2013, more small and medium-sized businesses (SMBs) went out of business than started.
But these odds don’t stop thousands of Canadians from realizing their dreams of being their own boss. So how can you set yourself up for success to beat the odds and create a small business that lasts?
“Failing to Plan is Planning to Fail”
There is definitely a fine line between planning to succeed and planning so much, you don’t ever get started. The Lean Startup recommends pushing out a minimal viable product (MVP) as soon as possible, to start momentum, deliver immediate results and learnings and get you into the habit of operating your new small business.
But that doesn’t mean you don’t need to take the time to develop a good marketing and business plan to test out during your MVP phase and refine as you learn from your experiences. Even established small businesses should be refining their processes, experiences and strategies or be left to the forces of nature.
“Cash Is King”
You can have the best product in the world, with a great staff and a flawless plan. Without cash-on-hand, you will not survive. Period. Your revenues should cover your fixed costs within the first year and you should have enough cash on hand, and/or a line of credit to cover slow periods that every company faces. The exact amount of cash, or liquid assets, your small business needs will depend on several key variables. Layout your business needs and take a stab at a cash target. You can always adjust this as things change.
“Behind Every Good Business Is A Good…”
… lawyer, accountant and website developer. These are the mechanics of today’s business and require divergent skills that no one person can adequately master. Nor should you – you’re running your business. So make sure you have a good lawyer, attorney and developer to help you stay in businesses and capitalize on opportunities.
“Treat Your Employees Exactly As You Want Them To Treat Your Best Customers”
An ideal employee is often defined as one who is happy, motivated and engaged. Happy employees are 12% more productive, and in a small business a percentage can be the difference between shutting down and staying open. Motivated employees go the extra mile with little input from you. Engaged employees actively find ways to improve your small business. There are loads of experts who explain how to get this ideal employee so do a little research and get started today.
To learn more about what it takes to create a small business that lasts, register for our free webinar, 7 Secrets to Building A Successful Small Business or access it in our library.