Building a company from the ground up is a scary business. While some would think it all starts with the name, there is a lot more to do to establish a successful first venture. It takes courage, willpower and the ability to know that failure is part of the process. As an entrepreneur, one of the most important things is to manage finances effectively. For those of you reading this, here are a few tips on how you could get your finances in order for the long run.
1. Track your spending
When you first start your business, there is a lot going on with the startup. From the employees to the different amenities in the office, everything needs to be paid and looked after. The first cheque you write is always exciting. However, unless you keep track of your spending, there is no looking at where the money is going. Like the wind, money comes and goes, without a filter. So do not forget to track your spending. There are plenty of accounting softwares available out there or you could opt for Google Docs as well to keep an eye on all your finances!
2. Don’t rely your business on credit card debt
For every story of a successful entrepreneur, there are a handful of unsuccessful attempts that don’t make for interesting stories. Credit cards are not the only way to finance a new company, they’re a very short term liability. They should be used as a tool to manage cash flow, not create cash flow. So, it is better not to rely your business entirely on credit card debt.
3. Set goals
Setting goals are very important and following them is even more important. This will allow you to keep an objective view of your business. Where you stand and what changes you may have to make along the way. So, be clear with your goals and follow them religiously. What to buy, why to buy and how to buy. Keep this in mind!
4. Seek out professional advice
As an individual, you can seek out mentors that can help you with personal finances. As an entrepreneur, you can continue to work with these people or seek out more established financial consultants that provide you with the guidance you need to run your business. Do not shy away from seeking out an advice from a professional.
5. Stick to a budget
For those who are in the early stages of their company, you need to know your personal financial needs to map out how much money you will need to survive and how long your current savings will last. This needs to be prioritized accordingly! Plan a budget and categorize the finances depending on your cash flow process.
The bottom line is entrepreneurship is not an easy task and getting your finances right plays a key role in any business! So, as a beginner, you need to spend your money wisely on anything and everything!
The Importance Of SWOT Analysis For A Business
Startups and their incredible stories, do not just happen overnight. It requires extensive research and dedicated hard work to make things happen. As a beginner who is launching a business, one must be aware of the do’s and don’ts of their business operations. Whether it is financial tasks or resources or manpower, a startup should keep a track of what and how and where to invest. Every business must conduct a SWOT analysis timely in order to find out its strengths, weaknesses, opportunities and threats. A perfect way to find out where your business stands is to conduct a SWOT analysis. From large firms to small firms, every business can follow this analysis to find out its whereabouts in the market and implement the same when required.
The four elements of a SWOT analysis are as below!
Strengths – This element shows the characteristics of a business that give you an advantage over others. In simple terms, your strength could be your Unique Selling Point (USP.) Alongside, anything that adds weight to your business plan such as financial support, effective strategies, first mover advantage or any other internal factor that is your strength comes under this category, Recognize your strengths and use them to climb up the ladder to success!
Example – Nestle Maggie Noodles is the leader in the noodle market and its strength lies in its first mover advantage.
Weaknesses – Weaknesses refers to the areas your competitors have an upper hand when compared to you in the market. It is extremely important to recognize your weakness and work on it before it is too late. Low performance of your team or lagging behind with respect to technology upgradation could be considered as one the weaknesses of a business.
Example – One of the major factors why Nokia disappeared from the mobile phone market lies in its incapability to switch to the manufacturing of smartphones at an early stage.
Opportunities – This domain helps you achieve your objectives with ease. Find out the factors which could help you do more with your existing customers or clients. With the additional information you have, go for an extensive market research. As a startup you can go for expanding your business via social media platforms. Use it as an opportunity to expand your business. Examine your business with questions like, are there any new technological advances we could use to expand our business and reach new consumers? How can we adapt our business to changing consumer tastes and preferences?
Example – IKEA is traditionally famous for its diversification strategies. The company is launching its first ever store in India with its debut in T Hub which happens to be India’s largest incubator for startups, located in Hyderabad, Telangana.
Threats – Threats can be elements in the environment that could be dangerous for a business. Emerging competitors or changing customer attitudes could be major threats. Consider the factors that could affect the flow of your business and its operations. Try to opt for a solution and overcome them. Threats are external factors that you have no control over.
Example- PepsiCo must consider the consumer shifting toward health drinks as a threat and focus more toward flourishing the market with health drinks!
As easy as it may sound, SWOT requires a lot of considerations with regards to your business, your competitors, your work environment in the best possible way. So, when you are starting a business do not forget to conduct the SWOT analysis! Swot away your obstacles with a successful analysis!
Life Lessons From Jack Ma
Jack Ma, a Chinese entrepreneur, who launched several successful startups in the face of severe criticism, was recently named “Person of The Year” by Financial Times. How, you ask? By focusing more on the bottom line than any other person around him. While people around him are always astounded by his stupendous success, these rules of life helped him get to his current position. If you wondered how he got there at all, then these inspiring life lessons might be just what you need!
1. Help others if you want to change the world
Help others. A principle Jack Ma always follows is to make even the smallest man work hard. According to him, small people will always grow big and become successful in life over the years.
2. It doesn’t matter where you start. Where you finish counts
Like Jack Ma did, do not focus on where you started your life. Your level of upbringing, your method of education and your lifestyle all do not matter as long as you do something with it towards the end. Dig your heels in and give every opportunity a shot!
3. Giving up is the biggest failure
According to Ma, “giving up is the greatest failure.” If you go out, try your best and fail to achieve your goal but see it through to the end, you are still a success. Like all great leaders, Ma recognizes a person is able to learn the most from obstacles and hardships. The key to success is persevering and learning from your mistakes. Give up and everything comes crumbling down.
4. Act swiftly
If Jack Ma had not jumped at the opportunity which was Alibaba, the world would have lost a truly great e commerce platform. Acting swiftly helps put you in the front and through acting on your feet, life can show you different things!
There were several times during Alibaba’s early history where the company seemed doomed. If Jack Ma had not fought against all odds to become great, he would not have made it anywhere near the top three. Hard times come and go but what you do in the face of these hard times is what makes you great in life.
With only $ 20,000 in hand and a dream to achieve, Jack Ma became the first Chinese entrepreneur in the world and is now the 118th richest man in the world. With a net worth of $ 29.7 billion, Jack Ma stands tall as a revolutionary inspiration!
How To Talk To People You Cannot Avoid
There is always that one person with whom you do not know how to break the ice. Even the most out going person could find it difficult to speak to strangers. However, every workplace has different people and sometimes, it just comes to a point where you have no choice but to initiate conversation; also known as small talk!
1. Begin with an anchor
An anchor is essentially the starting point of every random conversation. It helps to set the tone and gives you an idea of what the other person is thinking. I usually start off with something like, “Oh, the weather is so nice today, I do not feel like working!” The best part about these openers is both you and the person to whom you are talking to know the statement is for the purpose of small talk and the awkward ice can be finally broken!
2. Reveal something about you
The best way to fill the gap in those minutes where the conversation becomes awkward is to say something like, “this job is quite exciting. I have not done such a challenging role before!” When your colleague knows the struggle is real, the conversation flows easily and quickly.
Listen, because it is important. When you say some of those superficial line fillers, you never know what kind of a conversation it may trigger. For instance, I had a bad day at work and a colleague happened to ask me how I was. In all fairness, the question was just a simple opener. I took it to be a real opener and offloaded onto a stranger. What makes listening work is you can always learn something about the other person! On a side note, this person and I are really close friends now!
4. Know when not to talk
Okay so there are times when you are engaging in random conversations, you hear things you do not entirely agree with. If these conversations are with people you do not know, then it is best to really keep quiet and not say things you regret later.
Small talk is quite a task and usually, in an informal setting, the ice can be broken over shared interests. At work, that is a little harder, even for an extrovert like me! I have used these tips in the past so I truly hope they help you too!
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