Small businesses that survive from generation to generation are few and far between, but all business owners can learn from what they do well. To survive recession, adapt to changing trends and new technology, and to maintain your place in your market, takes certain key attributes. Here are some tips for building a business to last:
- Establish clear ground rules at the start. Every business needs strong foundations, so lay out clear values to work by, such as honesty, commitment and teamwork. Ensure your employees understand your goals and sign up to your values – success won’t come without them on board.
- Look after your employees. They are the face of your company, the means by which you will achieve your goals and the first point of contact for customers. If they are unhappy, your business will suffer.
- Maintain your reputation. A good reputation is critical to longevity and the longer you have been trading, the more inclined customers will be to trust your firm. It’s a virtuous circle, so make sure the public face of your company is exemplary, whether you are dealing with suppliers, in sales meetings or social networking.
- Remember, customers are key to your survival. Ensure that keeping your customers satisfied is always your top priority. Be aware that they are not merely a source of revenue, but their feedback can help you develop your offer and their word-of-mouth recommendations can promote your business for free. Make sure you keep loyal customers and use them to help you find new ones?
- Keep cashflow healthy. Don’t forget “Cash is King”. Always keep an eye on your costs, monitor your returns and chase late payments. Produce regular realistic cashflow forecasts and ensure any debt you have does not become insurmountable.
- Prepare for the unexpected. Although it is impossible to put contingency plans in place for every risk, you should have a business continuity plan. This will help you continue trading in the event of disasters – such as loss of valuable data or the cancellation of a large order.
- Know your market. It’s vital to stay on top of current market trends, while also keeping an eye on your longer-term objectives. This requires flexibility and adaptability – make the most of relevant new technology, for example, and carry out regular market research to ensure you are anticipating your customers’ needs.
- Balance your family and business obligations. Running a business can feel like more than a full–time job and put a strain on relationships with partners and children. For it to last, you need to keep an eye on your work-life balance. If you become run down or stressed, your business will suffer.
- Make succession plans. For your business to continue from generation to generation, you need to consider what will happen when you retire: whether you opt to pass control to a family member or someone else, or sell up. Form a succession plan to ensure a smooth handover. A forced or badly planned decision could mean your firm is transferred into reluctant or incapable hands.
Our acknowledgements to the IoD for this article.