About half of the world’s babies are able to walk (if a bit wobbly) by the age of one year. If a baby isn’t walking by that point, though, doctors are quick to reassure anxious parents that this is completely normal and perhaps the baby is merely a late bloomer.
Unfortunately, your business does not share this luxury.
If a small business does not have some sort of momentum by the end of the first year, it will often lead to an early and unfortunate exit from the marketplace. Expenses for running a business are simply too high to be able to support a fledgling, profitless business for longer than twelve months. So, in order to navigate through these trying early times without petering out too soon, business owners have to take some simple but vital precautionary measures; here are a few.
Patience is a Virtue
“Location, location, location” is a phrase typically reserved for real estate, but your business doesn’t have to be in the real estate industry to benefit from its message. One of the most common reasons for a small business’ early failure is that the entrepreneur is so eager to open up shop that they are willing to do so without securing a location that’s viable for prolonged success. To make use of an even more clichéd truism, patience is a virtue. Cliché or not, the message rings true; if you are too impatient to wait for a location that will allow you to quickly and efficiently find a stable customer base, your chances of surviving the first year in business will take a severe hit.
In order to avoid running into this dilemma, think long and hard about your overall entrepreneurial goals. While delaying your groundbreaking ceremony can be frustrating, it will be but a minor blip in your memory once your business is thriving, years down the road, in a community that suits your product/service and situates you directly amongst the most strategic area of consumers.
Don’t Forget to Live Your Life
Running a business is more than a full-time job: it’s a life-altering endeavor that requires more undivided attention than you’re likely used to giving to anything or anyone. As stress (and expense) mounts, so will the sleepless nights and frustrating days. While these things are inevitable to some degree, you need to do anything you can as a business owner to keep your sanity and your composure during your first year in business.
Develop routines that allow you to be flexible, but consistent. If a particularly challenging day leaves you feeling spent and uninspired on your way home, be sure to treat yourself to whatever foods and activities you find to be the best stress relievers. There will be times when you’ll have to take your work home with you in some capacity, but it’s important to make sure it isn’t every night. Otherwise, you’ll be too drained to work to your full potential the following day.
Be a Part of the Community
When your business first opens its doors, it immediately becomes a part of the community surrounding your location. Whether you like it or not, this reality brings certain responsibilities. The people inhabiting the area immediately surrounding your business will form the bedrock of your customer base, especially if you rely on foot traffic. For this reason, it’s vital to take part in as many community events (fundraisers, competitions, etc.) so that your brand begins to fold into the fabric of the community. The more comfortable people feel about your presence – physical and cultural – in their area, the more willing they will be to engage with you financially.
Plan for Delayed Profits
The time it takes for a small business to become profitable is completely dependent on how much start-up capital is required to get the doors opened. This makes it hard for entrepreneurs (especially first-timers) to get a grasp on whether or not their profit margins are where they should be, or behind the curve. Regardless of start-up costs, though, it shouldn’t be interpreted as a black-and-white determiner of success or failure.
Small businesses of all types have struggles to achieve profitability during their first year. Many new entrepreneurs are forced to spend all or most of their first year reinvesting what they make back into the business itself. These early months are invigorating, but also extremely trying financially. If your personal expenses (rent, utilities, etc.) are going to get neglected as a result of slow profitability during your business’ early months, it may best to hold off on starting the business until you have other ways of covering them.
Owning a small business is a remarkably rewarding experience. The spirit of entrepreneurship is folded into our country’s historical fabric, and the endeavor still holds its respectful place amongst our communities today. With it, though, come intense challenges – many of them consolidated into those first few months of operation. It’s the time when you’re developing your place within the community as well as your personal entrepreneurial identity. To make it through that first year with your business intact, focus on preparedness, maintaining your personal life as a haven away from the stress, and setting realistic expectations.