33 Must-Read Small Business Tips for New Entrepreneurs
Starting your own small business is an exercise in uncertainty, which is why it’s so important to learn from those who have been in your shoes. Get off the ground with these helpful tips from entrepreneurial experts. With the right guidance, you’ll succeed in creating a unique venture without reinventing the wheel.
Marketing, Social Media and Public Relations Tips
- Get familiar with where your target audience spends time on social media, and meet them where they are to make a connection. Although social media marketing can be overwhelming for small business owners — especially sole proprietors — you don’t have to be everywhere at once. For example, if you’re starting a running shoe business, join local Facebook groups for running enthusiasts. Engage authentically without being overly promotional.
- You probably already use social media in your personal life, but don’t make the mistake of treating your business Facebook page just like your personal Facebook page. Take the time to learn about social media marketing strategies so you can time your posts and develop your content in a way that best engages your followers.
- Become a thought leader in local and social media by creating and sharing content that provides value to your customers. Clients following you on social media are more likely to pay attention if they are receiving actionable, helpful information rather than constant advertisements.
- As an addendum to the previous tip, sharing quality content created by your competitors will encourage them to return the favor, thus increasing your reach and building your relationship with others in your industry.
- Create a basic press kit so you have it on hand when opportunities arise. This should include brief biographical sketches of you and any other executives, high-quality professional headshots, high-resolution versions of your logo, a fact-sheet about your company and other relevant information. Store it in an online folder on DropBox or another cloud storage system so you can quickly share a downloadable version with others upon request.
- Set up Google alerts for your business, your industry and your competitors, allowing you to stay informed at all times. This also assists with networking because you can easily share relevant content on your social media accounts and congratulate competitors and industry leaders for their successes, nourishing your positive relationship.
- Connect with your local newspaper and offer to write a free column on a relevant topic. Not only will this boost your status within the community but if it’s published online it will also drive business to your website and improve your search engine rankings. You can even draft and submit an opinion piece, as long as it is purely informational and not promotional. Build relationships with journalists so they come to view you as an expert source.
Customer Engagement Tips
- Even in this impersonal age, a personal touch will go a long way with your customers. Whether it’s a handwritten note to a new client or a gift basket after a big order, clients who feel appreciated will come back again and again.
- According to Forbes, grassroots marketing is one of the most valuable tools for getting to know your clients, particularly when you’re first starting your business. Take the time to meet your desired audience in the community and learn about their wants and needs. This will help you develop a product or service that fills an untapped niche in the market by solving a specific problem for your clientele.
- Everyone loves getting something for nothing. This means small businesses can attract new customers by offering special deals to try their products, buy-one-get-one-free offers, no-obligation trial periods or even monthly contests for social media followers.
- Build a referral program. Your best customers will come from word of mouth, so offer clients who tell others about your services a token of your appreciation. Whether it’s a cash bonus, a gift card to a local restaurant or credit on their next purchase, this incentive will give them a great reason to spread the word. Remember that unsatisfied customers are the most likely to tell their friends about your business, so turn the tide by encouraging people to share the good news.
- Establish a loyalty program to reward your best customers, and promote it with an incentive to join to attract an audience. Think outside the box to come up with fun, creative promotions that will build your business by giving customers a reason to return.
- Rather than treating competitors as adversaries, mentally reframe them as mentors that have valuable information to share. Introduce yourself and take time to nurture that relationship just as you would the relationship with customers. Ask for advice when you need it, and refer customers to competitors when appropriate.
- When it’s time to expand your business and add employees, you’re hiring for more than just the right skill set. Look for an individual with the creativity and personality to make a splash in your industry. If you already have a robust professional network, take advantage of your contacts to find the ideal candidate.
- As a small business owner, it can be tempting to try to handle everything on your own; after all, your business is your baby. But the most successful entrepreneurs know how to delegate. Focus on what you’re best at, then hire great people who share your vision to take care of the tasks that aren’t directly in your wheelhouse. If you aren’t sure where to start, spend a week or two writing down everything you do. Then scour that list for tasks you can delegate or outsource.
- Develop a support system. Studies conducted by the Small Firms Economic Development Initiative found that 70 percent of small businesses that receive mentorship from experienced business owners survive their first five years, compared to 35 percent of small businesses that aren’t advised by an industry mentor. You can get connected with a mentor through your local chapter of the U.S. Small Business Administration.
- Even if you’re starting your small business as a side gig with a shoestring budget, keep careful track of your finances to start off on the right foot and make your life much easier come tax time. Save money and work on your credit if you’re preparing to start a business to make yourself more attractive to potential funders and avoid the baggage that can sink small businesses.
- Figure out how you’ll make a profit by creating a breakeven analysis. This tool lists all your business expenses, allowing you to figure out exactly how many customers you need to get before you break even. Use it as a road map to set your benchmarks for success.
- Protect yourself from personal liability by creating either a limited liability company (LLC) or a corporation. Even if you’re a sole proprietor, having a legal business entity will ensure your home, car and other assets cannot be seized to pay for business debt or the costs of a lawsuit against your company. You can also gain important tax advantages by establishing a separate business entity.
- When you have employees, make sure to follow IRS rules about how to categorize them for tax purposes to avoid large penalties. While paying an independent contractor and reporting this payment on a Form 1099 is often the best and most affordable course of action for a small business, you must consider an individual a full-time employee if he or she performs essential business tasks, does not work for any other businesses, works approximately 40 hours a week and takes instruction from you about how to perform his or her duties.
- The lower your overhead, the higher your profit margin. If you don’t need a physical location such as a storefront, consider running your business virtually. With so many online tools and systems for everything from storing your files to connecting with clients, you can stand to save money by investing in technology and forgetting those monthly rent payments.
- Research and obtain the required business registrations, licenses and permits in your state and municipality. In most states, business registration is handled by the office of the Secretary of State. Other requirements vary by where your business is located and the type of company you own; your local Small Business Development Center can provide guidance on those that apply to your venture.
- Find out whether you need an IRS EIN (employer identification number). This is required for tax purposes if you have employees or are subject to specific types of taxes depending on your industry. If you do need an EIN, you can request it free online from the IRS. It’s good practice to get one since you’ll need it to open a business account at most banks — an essential step to keep your company’s finances separate and protect your personal liability.
- Set up your business books to keep track of income and expenses, or hire a small business accountant if you’re not familiar with the process. He or she can advise you on requirements and best practices so you can ensure you’re making optimal use of your finances and staying on the right side of the law.
General Tips for Success
- Fall in love with the idea of owning your own business, not with a specific product or service. Being too enamored with your offerings can hamper your flexibility; the ability to fail quickly and bounce back by pivoting in a new direction is invaluable for entrepreneurs.
- Hire professionals when necessary. Specifically, a good accountant and attorney are worth their weight in gold.
- Always get it in writing. Verbal contracts are very hard to enforce and are only valid in certain situations. While contract laws vary by state, common provisions indicate that certain types of contracts are only legally enforceable in written form. This typically includes contracts for any sale of more than $500, those intended to last longer than a year and any transfer of real estate or intellectual property.
- Break big goals into small pieces and then even smaller pieces if necessary. The Hartford Small Business Association recommends creating five-year, one-year and quarterly strategic goals. Those quarterly goals should be further delineated into monthly goals, which will inform your day-to-day business operations and keep you on your chosen path to success.
- Keep your day job even after you launch your new venture. This will give you the security of a paycheck while you do the legwork to build a successful venture and make it easier to make the leap to independence when the time comes.
- Be aware of your energy level to enhance productivity. For example, if you’re a morning person, get your most difficult tasks out of the way first thing in the morning. If you tend to be a night owl, you have the flexibility to sleep in, start slow and burn the midnight oil. That’s one of the great things about owning your own business.
- Create and stick to a daily routine, even if you’re running your business from home. Waking up, showering and having breakfast before sitting down at your computer (even if it’s at your kitchen table) can do wonders for your motivation.
- When your product or service is in its early stages, build an advisory board of potential customers who are willing to weigh in on your ideas. Their valuable feedback will allow you to fine-tune your unique selling proposition: the benefits or original features of your offerings that will lead clients to choose you over your competitors.
- Put systems in place for the things you do every day. Look for ways to increase efficiency, which in turn improves your bottom line.
If you’re thinking of starting a small business, you probably have money on your mind. Although saving a seed fund for your venture is recommended, you can bolster it with a line of credit from an online small business lender.