A startup is often clubbed with small business but there is a fine dividing line between the two. The difference is in the outlook and goals of the two in regard to growth. Small businesses generally cater to a specific market or industry while start-ups have to explore various options that ensure quick growth and profitability.
As a startup, the first challenge that you’ll face is funding.
In all probability you’ll have to start off with own funds, or even institutional lending if you can provide adequate collateral. Once you are successful and show early signs of growth, angel investors along with venture capitalists will step in to en-cash on your winning start.
When your startup stabilizes at higher performance levels, the logical step will be an IPO (Initial Public Offering), but this may lead to the erosion of your original investment and equity. However, these are just the first steps generally taken and you can explore alternate avenues too.
To get to the next level, you will have to follow specific strategies to reach your targets even though in the prevailing business scenarios. You will laso have to be flexible,and be preapred to modify goals to suit current market needs.
Here are some of the basic steps that you should consider when looking at ways to enable your startup to grow quickly and boost profitability.
- Have a Business Plan in Place – At the start, you should have a well defined and structured business plan in place. However, a business plan is a very complex document and the task of creating it should best be left to small business consultants. There are several components that are critical to a business plan such as future marketing approaches, cash flow projections, finalising sub goals to achieve overall objectives and optimising allocation of resources. All this helps to meet financial targets of turnover and profitability. It is a broad and all inclusive document that can be used to get partners on board or have credit limits sanctioned from banks and financial institutions.
- Devise Digital Marketing Campaigns – For a startup this is extremely important for quick growth and spreading brand awareness. In the modern business environment, ads in print and electronic platforms like radio and TV are considered passé, the shift now is to creative effective digital marketing campaigns.
The main reason for this is that more and more people now search first online for products and services before coming to a purchase decision. To stay competitive you have to increase sales and conversions, these are necessary so that your website has a strong online presence and ranks high on results pages of major search engines. Entrust your marketing campaigns to specialized digital marketing companies that use advanced techniques such as SEO and Social Media Marketing.
- Outsource Liberally – As a start-up, you should liberally outsource key operating functions since it is not possible for you to handle or monitor all aspects of your startup. If you hire highly trained manpower at exorbitant salaries, it will create a dent in your already stretched finances. The best option is to outsource certain key functions to Business Advisory Services in your area of operations at a minimal cost while ensuring top quality output and productivity.
The primary function that you should outsource is bookkeeping. This task can be tedious and repetitive and does not require any real managerial discretionary powers. Critical elements of accounting like accounts payable and receivable and bank and credit card reconciliation will be processed promptly by outsourced agencies and updated reports routinely submitted to you. You will thus have strict control over your finances and can make suitable diversification and growth plans.
Another area that should be outsourced is data entry and document management. This is an area which requires the installation of advanced hardware and software at substantial investments and by outsourcing, the savings can otherwise be utilised for business development and growth.
- Choose the Right Business Opportunities – Before diversifying into new fields or tapping into various business opportunities, it is necessary that you move with caution and restraint. Moving into unknown territory can destroy you financially if you are not successful and affect the primary business that you have built over the years.
Assess what you have offered to your customers over the years, keeping this as a benchmark, evaluate whether the new lines of business that you seek to open up align with existing priorities. If you are not sure wait – there will be many opportunities in the future as your startup prospers.
- Carry Out Periodical Business Health Checks – It is important that you always have thorough control over your startup and periodically check its operational efficiencies.
This is known as a business health check and it is best entrusted to a financial consultant who can give you a fresh and unbiased perspective of the state of your business as well as advice on corrective action that should be taken if necessary. A second opinion from a professional not directly connected with the business ensures an overall objective view.
There are many other variables that will ensure that your startup gets off the ground quickly and maintains the tempo of fast growth. Following the basic ones given here will initially help you move in that direction.
Author Bio
Ashley Gilbert is an experienced and highly qualified Business Consultant who has helped numerous start-ups and small business grow quickly and effectively.
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