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SURVIVAL TIPS FOR SMALL BUSINESSES

During Global Entrepreneurship Week (in November 2017), the spotlight is on the small business owners who power the world economy. Many South Africans embrace entrepreneurship to create a better life for themselves, their families and their communities. Yet between 70% and 80% of SA businesses fail within the first five years. And the first year of a new business’s life is especially critical to its future success. The process of writing a strategy and planning document can help you sharpen your vision and identify potential pitfalls for your new company. It needn’t be long – you just need a few pages detailing issues such as:

The problem you are trying to solve in your market.

The customers you are targeting.

Milestones such as launch dates, customer targets and revenue and profit forecasts. Funding plans. Costs. Competitors. There are some great templates available online and some encourage you to get your high-level plan to fit onto a single page. It’s important to keep your cost base as low as possible while you wait for revenues to start flowing.

Use contractors and freelancers rather than hiring full-time employees; work from your garage or study; use low-cost digital channels (such as Facebook) for marketing and hire smart, inexperienced interns and train them. Professional HR, tax and financial advice is worth paying for. An accountant can help you achieve significant tax efficiencies and save money. Good HR advice can help you avoid expensive disputes with employees. Focus on a single region or product line. Start off in a territory you know well, then you can develop a revenue stream and scale out to more markets. This will save you time and help to avoid human errors.