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Charlotte · Raleigh – Durham · Chapel Hill · Triad · Southern Pines · Coastal Carolina
Closing the GAAP to Scale Your Business
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919-230-4667
Scale Finance, LLC, Financing, North Myrtle Beach, SC
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7 Steps for New Business Owners

Source: BizActions

Running a new business can be a daunting and high-risk endeavor. Many things can go horribly wrong. As soon as you form a business, you’ll face many important decisions, ranging from mundane to critical. While much of what you must learn comes through trial and error, other lessons can be learned by observing what other business owners have experienced. Here are seven tips to help you hit the ground running.

  1. Break your goals into sub-goals. Generating revenue and earning profits are goals that all businesses pursue. However, it makes sense to break such important goals into sub-goals. For example, instead of focusing exclusively on earning a profit, a sub-goal could be to make five sales calls per day. The more sales calls you make, the more likely you’ll earn revenue and book a profit. Breaking it down into sub-goals can make the process more manageable and provide quicker feedback.
  2. Track cash flow religiously. Businesses must generate cash flow to survive. Yet too often, business owners spend little time monitoring how money moves through their business. In addition to an income statement and balance sheet, prepare a cash flow statement that tracks how changes in the balance sheet and income statement affect cash.
  3. Don’t spread yourself too thin. As a small business owner, there’s a never-ending list of tasks that require your attention. However, by attempting to cover every task by yourself, you’ll inevitably struggle to deliver. Learn to delegate to employees or contractors. While doing so may feel uncomfortable to begin with, it’s crucial that you don’t attempt to accomplish too much by yourself because it will lead to burnout.
  4. Resist the temptation to grow too fast. For some businesses, there’s no shortage of ways to grow. Nonetheless, if your business grows too quickly, you may run the risk of failing to deliver on lofty customer expectations. Forecast how fast you can grow your business without overstretching your operations. If you experience growth beyond that rate, look into accelerating your plans for expansion, which might include hiring more employees or executives or opening a new facility. However, only expand if your business can support the expansion without becoming financially stretched.
  5. Keep your costs low. Many businesses find themselves struggling to stay afloat due to crippling overhead costs. From the moment you establish the business, do your best to minimize your overhead costs. For example, instead of hiring full-time employees, consider engaging contractors. Instead of renting an office, run the business out of your home for a while. Keeping your overhead low also prepares your business to survive changes in economic conditions, such as a recession or the loss of a key customer.
  6. Hire slowly and carefully. When the time comes to hire your first employee, make sure you create a stringent application process and avoid taking shortcuts. Don’t be in a rush to fill vacancies. Hiring the wrong employee can have catastrophic consequences. During the interview process, make sure you provide a detailed description of the job to ensure the candidate understands the role. Present the candidate with real-world challenges to test his or her ability to problem-solve. And while it takes time to contact a candidate’s references, set aside the time to do so because it can uncover critical information.
  7. Know when to ask others for help. Running a small business can stretch even the most accomplished owners. Don’t be afraid to ask others for help in navigating the inevitable challenges you’ll face. To that end, build a team of mentors who can help provide a fresh perspective to problems that may seem insurmountable. You might also consider hiring a coach who specializes in helping small business owners. They can provide an impartial third-party perspective and share best practices from other small business owners they advise.

Survive and Thrive

As an entrepreneur, you’ll face countless challenges in running your business. Your ability to survive and thrive depends on a broad range of factors. However, the steps noted here can help position your business to compete no matter what type of market conditions you face.     

About Scale Finance

Scale Finance LLC (www.scalefinance.com) provides contract CFO services, Controller solutions, and support in raising capital, or executing M&A transactions, to entrepreneurial companies. The firm specializes in cost-effective financial reporting, budgeting & forecasting, implementing controls, complex modeling, business valuations, and other financial management, and provides strategic help for companies raising growth capital or considering M&A/recapitalization opportunities. Most of the firm’s clients are growing technology, healthcare, business services, consumer, and industrial companies at various stages of development from start-up to tens of millions in annual revenue. Scale Finance has multiple offices in the Carolinas including Charlotte, Raleigh/Durham, Greensboro, and Wilmington with a team of more than 45 professionals serving more than 130 companies throughout the region.

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Knowledge Bank

Understanding the True Cost of Employee Turnover

How to Think About Valuation When Raising Venture Capital

What it Takes to Shift to a Recurring Revenue Model in Hardware & Software

Differences Between Major SBA Loan Programs – SBA 7(a) vs. SBA 504

5 Reasons Entrepreneurs Don’t Get Funded (Which Are Not Their Fault)

Balancing Profitability Versus Growth

Bootstrapping Your SaaS Business – What’s Changing

Best Options for Small Company Loans

Loan Workouts – Understanding Various Options

How to Value a Fintech Startup

The Value of Angel Investors

Finance & Accounting 101 for New Small Company Owners

How to Handle a Bank’s Rejection of Your Loan Request

Accessing University IP – Negotiating Financial & Other Terms

Why VCs Sometimes Push Companies to Burn Cash Too Fast

7 Steps for New Business Owners

Basic Benefits of Starting a Business in North Carolina

Accounting Fraud – Common Causes and How to Stop It

Why 80% of Court Judgments Go Uncollected

7 Steps for Early Stage Fundraising from a VC

Explore the Knowledge Bank…

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Media

Scale Finance Managing Director Dave Gilroy interviewed on WSIC Radio (local Fox affiliate)

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