My Small Business Management Tips

by The Smarter Wallet on January 13, 2010

yard sale

I’m new at entrepreneurship. I’m a small business owner who just recently started running her own business online. So far, I have learned quite a few interesting pointers about being a business owner. A lot of these may seem obvious but it’s still a good idea to write it down for clarity. Thought I’d share them with you:

My Small Business Management Tips

1. Know your goals for your business. Are you starting up a business to supplement existing income or is this your main source of cash flow? What milestones are you setting for yourself? For some, starting a new business is a serious matter and is a dream come true, while others consider it more of an experiment and an extension of a hobby. In my case, I started out nurturing a hobby that turned into something much more serious over time (as I realized it had potential).

2. Know the risks of running your business. You may be wondering about small business financing and how to fund your venture (perhaps an outfit like Lending Club can help). But if you’re going to put up money to get your project going, then managing it well will be key. When your money is at risk, it feels like a lot more is at stake. The good thing about online ventures is that you don’t start out with too much money on the line — but with such low barriers to entry, it becomes competitive as all heck to grow and maintain this type of business. Also, be wary of any liabilities or lawsuits that your business may potentially incur. Obtaining professional liability insurance is a good way to protect your business (as well as your assets), if anything unexpected does happen.

3. Keep an exit strategy in mind. Many people plan to keep their businesses going as long as they can keep them profitable. But if you cultivate an exit strategy, you may find yourself setting priorities with more conviction.

4. Be prepared for an erratic income. Ah, this is the toughest part about any business — the iffiness of receiving any income at all! Let’s not forget that customers can be fickle, and therefore, revenue and profit can be pretty unpredictable in many instances. By being an entrepreneur, there’s no such thing as a stable income — things can be great for a while, but unless you can reinvent yourself every so often, it’s possible that your profitable streak can end at any time.

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