Category: Starting Up

Article Contributed by Ved Raj

Taking your startup to the next level can be daunting and frustrating to say the least.

Constantly evolving and taking your business to the next level is very important. The right strategies for growth and evolution may not be the same for every business model, but there are some ground rules for all.

Evaluation

One has to carefully evaluate the exact stage of the business lifecycle . The planned activities must be compared with what has been achieved so far. Analyze the revenue levels achieved vis-a-vis planned targets. This must also be studied along with the level of customer satisfaction and retention that the product is getting.  Studying the business plan again, will help you understand the real issues your business is facing in the current scenario.

More Aggressive Marketing

Analyse your social media presence to understand the kind of audience you are reaching with your current level of activities. Re-work and expand the level of activities that need to be done to get more relevant conversions for your business. Do create a blog, if you don’t have one already. Creating quality content is an ongoing marketing activity for a growing startup.

Optimize Your Team

Don’t work with teams who are under-performing. A good IT outsourcing company is very useful in helping find the right sort of remote talent for your business. The technology maintenance and upgradation part for the business can be easily outsourced in a cost effective manner.

Tax Optimization

Analyse the taxes you’re paying in your business and understand all the deductions that you can get and are not availing, as of now. Also make sure that your business is not in a tax heavy location. You can change your business location if an alternate location provides more tax savings.

Customer Reviews

Once your business has reached a certain level, there are many satisfied customers and users. These can be leveraged to improve the image of the business and to get more business.

Solicit reviews and testimonials from your happy customers and promote them on your website and social platforms to build credibility.

Data Mining

Acquiring new customers and retaining the existing ones is essential to every business. Taking the right steps to acquire new database and executing the right email campaigns for your target audience will help in improving the rate of conversions.

Explore Sources Of Funds

Funds are continuous requirement for every business. Building the right expertise and reputation for your business is useful in attracting venture capitalists and partners to invest on new marketing and expansion initiatives.

Manage Your Cash Flow Better

Getting your payments on time and managing cash flow better are the most important aspects of your growing startup. No matter how much profit your business makes, if the clients are not paying up on time, its something to be really worried about. Cash must be spent judiciously to ensure a healthy business cash flow in every period. Timely payment are a must too.

Creation and Optimization Of Processes

A growing startup needs to create the right processes to be able to build a bigger enterprise. Training employees to collaborate and work in a team is an important aspect as well. A startup usually does not have too many processes. But, as it grows, defining systems and processes becomes essential for better growth and publicity.

Setting New Targets

Every startup must renew the zeal to move to the next level. This may happen every 6 months, one year or longer, depending upon the speed of business growth. Setting new targets becomes imperative, the moment there is a level of saturation.

Taking your startup to the next level requires unmatched motivation. A business leader must think innovatively and act promptly. These traits will enable him to overcome all the hurdles to growth.

About the Author

Ved Raj is a business enthusiast. He writes about startups, remote teams and outsourcing. He is working as a Marketing Manager with ValueCoders, a leading provider of remote development teams.

The aura surrounding a startup in contracting is buzzing with potential, excitement, and momentum. Finding yourself in one is like setting things into warp drive. The time it takes between idea and conception goes so fast that before you know it you’re no longer buzzing but facing very harsh realities about what the future holds and how the startup is going to handle the growing pains associated with its increased popularity.

If you’re too wrapped up with the initial excitement and get caught up in the speed of development then you could pass those moments that are crucial to the longevity of the startup. The startup falls into the perpetual cycle of hitting barriers put in place by this rapid growth.

The following are some of those common growing pains a startup may face so that you may get a better idea of what to expect and how to dodge the crud if it’s about to hit the fan.

1. Scope Creep

The early days means that every idea is technically viable for the offering because it’s still very flexible and there will be a lot of input from all those participating.

However, it’s very easy to get stuck in a perpetual cycle of scope creep, which makes the startup miss deadlines time and time again because so much is being tacked on rather than “getting it good”, releasing it to the public, and making the necessary updates after feedback.

Scope creep will generally be the first major barrier to growth so make sure the team understands the deadlines and have a detailed outline of what needs to be done (that nothing else can be added until the project has reached completion).

2. Expanding Too Quickly

Being in the position of a contractor means that a lot of jobs will begin pouring your way if you’re doing the right amount of networking, advertising, and marketing. Before long you realize that the only way you’ll be able to keep up with the demand is by taking on new help but because the demand is so heavy you may hire too quickly and make serious mistakes:

• You may not have screened the individuals stringently enough and turns out they do not actually have their certifications
• You hadn’t planned the increased importance of legality and such items as insurance for the new help (or even the additional equipment you’ve taken on)
• You don’t have enough time to build a quality team that is built on solid communication thus pitting individuals that may have quarrels with one another (potentially slowing down projects)

Just remember to take your time when you are expanding, even if this demand is starting to become crucial. Take the time to really get to know the individual you may be taking on to ensure they have the right skills and qualifications to do a good job. Cover the legal side of things by doing your research and working with a business that handles such things as general liability and usage of equipment. Look for online quotes. Many companies, Target Insurance Services being one, offer free quotes on general liability, workers comp, commercial auto, and bonds.

Ensure that the help you are bringing on are able to work with one another and be ready to switch up the teams if there are issues in communication.

3. Failing to Raise Capital

Even a great idea is worthless without taking action and even then you need working capital to get the ball moving because there are many cogs in the machine:

• Equipment purchases (or rentals)
• Permits & training
• Marketing & advertising
• Management & human resources
• Adequate cash flow for the early stages

The money is there for you as a contractor but it’s not going to come through if there isn’t enough initial capital to make it happen. You do have the option to take out a line of credit from a local bank or go the route of funding the startup through personal credit. Either way it needs to be there otherwise your new business is just making empty promises.

Get out there and network the best you can, talk to the financial institutions, understand the potential scams, and be persistent. Raising capital will be just as hard as the actual work involved with the business so place just as much time and effort into getting it secured.

There will be some pain but ultimately there will be gain. Take these items into consideration and keep them in check so those growing pains aren’t as rough as they could be.

While you would think lack of sales would be the number one money problem a start up may face, more often than not, the top spot goes to cash flow issues. Money is being made, but not being managed properly, and when this happens, your business will suffer greatly.

Fixing cash flow issues requires a few things. First, you have to take the time to go over your business with a fine tooth comb to see what is happening with your money. Secondly, you must be disciplined in carrying out the changes you know will improve the situation. And third, realize this isn’t a set-it-and-forget-it-type-thing. You need to regularly check in, and see if you need to make any adjustments. Here are just a few helpful hints to get you started.

1.  Don’t Spend Money When You Really Don’t Need To

This one may sound a bit obvious, but many start ups don’t heed this advice. In an attempt to build the business as quickly as possible, there is a tendency to take on expenses that just aren’t necessary.

Sure, you will need a few employees eventually, but if contractors can get the job done for now, use them as needed. Paying for full coverage contractor insurance now could save you an endless headache and considerable cash later. Don’t rent a huge office space if revamping your home office will suffice for now. Unnecessarily burning through precious capital, and increasing your debt is not a smart move when you have yet to turn a profit. Remember simply throwing as much money towards your business as possible does not ensure faster success.

2.  Hold Onto Cash as Long as Possible

Paying our bills once we get them definitely feels good; a weight has been lifted. We feel financially responsible. But, if you are trying to improve your cash flow situation, you may want to reconsider this tactic. As long as your bills are paid by the due date, vendors, credit card companies and the like are happy. If your payment isn’t due until the 30^th, why send it in on the 11^th? Unless of course, you are getting some great deal from a vendor on an early payment, pinching your cash flow may not be a good trade-off.

3.  Handle Receivables the Right Way

Poor handling of receivables is a major problem for many start ups. Payments are not tracked carefully. Maybe you fear alienating customers by going after them for late payments. You are not screening carefully enough, and are taking on clients who are not good with payments. Address these issues stat.

If possible, request at least partial payment before delivering a product or service, perhaps after the first couple of orders so customers know they can trust you. If your net 60 terms are killing you, reach out to clients about changing them to a shorter payment period. Offer discounts for early payments; while it might seem counterintuitive to reward late-paying customers with a discount, it might be worth it to get that cash in the door faster.

4.  Get a Merchant Account

Merchant accounts may cost you each time someone uses a credit card to pay you, but when it comes to getting paid as quickly as possible, using credit cards takes the cake. Don’t just sign up for the first one you come across—do a little bit of homework to ensure you find the company that best meets your needs. Encourage customers to pay this way.

5.  Research Your Financing Options

Get familiar with the different financing options available to you should you really find yourself in a cash crunch. Perhaps you could look into factoring receivables temporarily. There are many companies that offer short term loans for businesses just like yourself, and may be a faster and easier option than traditional financing through a bank to achieve ends such as purchasing equipment.

6.  Offer Stock as Compensation

If you are starting up with a team of people, consider offering stock as compensation, at least partially, until you start turning a profit. Not only will this aid in keeping cash on hand to grow your business, it will light a fire under your team to start making money as soon as possible.

So, there you have it—six powerful tips for improving cash flow, and helping you reach your business goals.

The Jayson Law Group LLC has put together a comprehensive Guide for Tech Start-ups in New Jersey.  This guide aims help those interested in starting a tech company in New Jersey navigate the twists and turns of being a new business owner, especially within the growing tech industry.

This guide is provided as a starting point into the necessary steps in forming a New Jersey start-up and the options and incentives available to technology start-ups in the state. While your tech start-up may qualify for other more broad-based programs and services, the scope of this guide is to focus on those resources and incentives that are only available to technology start-ups.While we hope that this information can guide you, it is prudent to seek the advice of an experienced business attorney and accountant prior to making any decisions or taking action. Experienced business development professionals can help you understand how these programs can help your start-up gain its footing.

Technology Start-up Company Regulatory Checklist

Forming a start-up company is a technical legal process that is often best handled by an experienced business attorney. While there are many other aspects to planning a successful start-up, this checklist will focus on the legal and regulatory requirements New Jersey businesses face. An experienced attorney can provide guidance related to the organization of the business, registration of the business, required local permits and ordinances, business licenses and certifications, employment disputes, New Jersey insurance requirements, succession planning, and many other business concerns.

The legal form of your business entity

In New Jersey a business may be organized as a sole proprietorship, a partnership, a corporation, a limited liability company (LLC), or a limited liability partnership (LLP). Businesses operated as a sole proprietorship or general partnership do not require registration at the state level, though it is advisable, unless a trade name will be used. A trade name, often expressed as doing business as (d/b/a), requires registration in the county where the business is situated. For statewide protection your company must register in each of the 21 counties of New Jersey.

Many, if not most, growing businesses soon outgrow the forgoing methods of organization because personal and business liability is commingled. If you wish to organize your business as a corporation, a limited liability company (LLC), or a limited liability partnership (LLP) you must Register a New Business Entity with the Division of Commercial Recording, New Jersey Department of Treasury.

Registration for tax purposes

The New Jersey Division of Revenue requires that all businesses register for tax and employer purposes regardless if the business will have employees or engage in business that requires the collection of state sales tax. New Jersey has streamlined its process and registration will also allow your company to arrange for taxes, New Jersey unemployment insurance (UI), and disability. Depending on the form of your business, you also may need to obtain a Federal Employer Identification Number (FEIN).

View the comprehensive Guide for Tech Start-ups in New Jersey here.

Article Contributed by Kate Critchlow

There are points in time for a number of us when we consider the possibilities of starting up our own business, and it usually comes as a result of a good idea or a desire to be self-employed. However, if all you have is a bit of an idea you’re not going to get particularly far, or at least not until you have considered some of the other things that need to be included in starting up your businesses. An important thing to remember is to take your time to put the full thought and consideration into every aspect of your business before you jump in.

Step One: Build Your Idea

The idea is the most important part of your business, it might be a particular product you enjoy making or feel people would find useful, or it might be a service that you feel people need.  If you have an idea that appeals to you and your target audience then you’re off to a good start, even if that idea is a single product you want to make, you can certainly work with the idea to formulate a whole business, but for now forget about the business and concentrate on the product.

Is there anything else like the item or services you’re planning to offer? How much competition is there? What will make you different from the competition? Ask friends and family what they think of your idea and take any criticisms they might have into account as you continue to build on the idea – in most cases these people will be your first customers, so try to listen to their opinions and act on them as much as you can.

Make sure you know what your goals are, it can be most beneficial to know from the start whether you want to grow a business big and fast in order to sell it for a profit or whether you want to sustain a small, profitable business that gives you a steady income – they are very different outcomes for your business and are achieved by following very different routes.

Consider how your idea will perform as a business. Is it something you can do alone or something you will need help to accomplish? Can the idea be changed to make it more cost effective or time efficient? If you’re going to need help and want to bring in a business partner consider very carefully before doing so; how are you going to split the costs, profits and work load? What is your relationship with the person? How will your relationship suffer if the business goes bad and how would your business suffer if the relationship goes bad? Be completely certain before deciding on a partner, agree on what both parties will contribute and be expected to do, write it down and both sign it. This agreement will protect you both in a number of eventualities, regardless of whether that’s because the business went well or because it went bad.

Step Two: Build a Business Plan

Once you have an idea of what your product or service is going to be you can start to think about how it will function as a business. There are a number of things that you’re going to take into consider, try to start by thinking about how you’re going to describe your business, and write down a paragraph doing so. In this you should include why people would choose you, who you target your products or services to and how you deliver these products or services. This will help you to find the focus of your business, regardless of whether you’ve chosen to pride yourself on your local services and focus or you want to bring attention to the completely unique products you can offer.

There are going to be plenty of things to take into consideration; like how long the products or services are going to take you, what you’re going to charge, how much money will be yours and how much will go back into the business, where you’re going to operate. There are hundreds of questions you could ask yourself, and in some cases you already know the answer, so you don’t have to worry about those. Instead think about the questions that are bothering you, those you want to ask and don’t have an answer to, or those your friends and family ask – those are the questions you’re going to have to answer.

Step Three: Consider Marketing Strategies

You’re going to want to give some consideration to your marketing. Where are your customers going to come from? How are you going to reach them? How much money have you set aside for attracting your customers? You’re going to need to be able to implement a marketing strategy as soon as your company is ready to put out work, and of course this is important because you’re going to need customers when you start – friends and family are only going to get you so far.

Consider all of the important questions regarding who your market is; what age range are you targeting? Are you marketing your products towards other businesses or individuals? Where are you likely to find your clients? What are they likely to be interested in? What are they looking for that you can offer? Take into consideration all of these key factors and try to think in the manner you would expect your customers to think; this will help you to come up with a few marketing ideas.

Be sure to write out at least three different plans and put them together with a reasonable standard of detail in order to ensure that you are able to make use of them as effectively as possible. Don’t forget to research the costs of your advertising, and research into coverage and return too, while monitoring the results of your marketing carefully. Understanding early on what has worked well for you and being able to predict how well marketing is going to work for you will help you to keep the number of sales and customers you have within your own chosen parameters.

Look at who your competitors are and how they market their products; chances are your competitors are aiming for something very similar to you, so you may find that they offer some excellent solutions to give you an idea of what marketing plans you’re going to need. It can also be beneficial to know who your competitors are and how well they are doing in the industry, as this may help you to project roughly how well your business is going to do.

Write a plan that will outline your expected progression. Start by making a list of everything that is going to have to be done, then specify an expected timeframe that will be required to do it. End by writing a development plan that will outline the order in which things will be done, who will deal with them, what the deadlines are and the expected time of completion for each task are. You may be looking at preparing staff and space for services, or looking at organising and acquiring materials, packaging, warehousing and shipping arrangements for your products. There are a number of things you may need to worry about, and the first initial period is often the most stressful and the busiest; so prepare for this.

Once you have done the important bits of market research you can think about moving on to the next stages – but keeping an eye on the market and your competition will be important throughout the life of your business.

Step Four: Do the official bits.

There are a few things you need these days before you can actually be considered a business – a name, logo and website make a good start. If you haven’t come up with a name for your business yet you should probably put some real thought into this, consider something short and snappy, easy to remember and bonus points if it can be associated with what your business actually does. Once you have the name set out the logo should be next; as this can be much easier to figure out once you know what your company is going to be called, as well as what it is going to do.

Consider both when coming up with concepts for the logo, and decide on features you want to be sure the logo offers. Once you have a rough idea of what you would like to be included in the logo or what you might want it to look like you may want to consider having a professional design it for you, unless you are particularly artistically inclined. In most cases a professional design will look much better and you’ll probably be happier with it, but this can be quite an investment depending on the designer you choose.

The website is another thing that is probably best left to the professionals; though of course you should map out what you want, put together the information you would like to be presented and have a good idea of how you want the website to look and work the design process and development process can be rather difficult unless you have experience and training when it comes to web design and development, neither of which are particularly simple to accomplish at a business professional standard with self-taught skills.

During the process of designing and developing your logo and website you should take into consideration who your target market are and what they want from you, as this will help you to accomplish a more suitable design that is going to be much more appreciated and more attractive to your particular customers.

Be sure that all of the financial aspects of the business are dealt with; consider how much your business will cost you to run in the first few months, as well as the initial start-up costs. You should be able to operate the business for two months after setup, even without any return on the investment, as this is the easiest way to ensure that you are financially secure in your business. Consider the VAT threshold and prepare your business as if you’re going to exceed it in the first year, if you don’t then you don’t have to worry about it and you get to keep a nice bit of cash, if you do then you’re prepared for it and you don’t have to find the money to pay your VAT at the end of the tax year. Be sure that you are fully prepared for your taxes.

Step Five: Work Hard

Owning a business is not as grand and luxurious as some of the old movies of millionaires made it look, or at least not in the beginning. There is a lot of work that goes into the business during the early stages, and that work has to come from you. Build your brand, make a good impression on your customers, produce your product or supply your services to the best possible standard and ensure that you operate to the best of your ability.

It might take years, but in time it will be worth it. Continue to grow, develop and improve and you are sure to find the rewards that come with owning a business. The more you improve and grow the more you can rely on your business to provide you with a good income, and the more you expand, hire and train the more your business will become part of the community and the less work you have to do yourself, giving you more time for some fun.

If you’re the sort of person that doesn’t finish what you start and gives up easily then starting a business is not for you; it can result in a massive amount of debt and stress. However, if you’re organised, hard-working and willing to put the time and effort into a business then you have an excellent opportunity for success.

So – The Checklist.

I completely understand if you skimmed over the information above, it was a lot to get through and you’re probably in a hurry to get this business started. But let’s not rush anything. Here’s a checklist of the things you’re going to need to have prepared before

• Organise and arrange your funding and finances – (You may be applicable for government supported funding. Check here.)
• Business name, logo and website
• Analysis of your target market (create a buyer persona for reference)
• Make arrangements with suppliers (if you need raw materials, product packaging, shipping or courier services, equipment and supplies etc. you should get quotes from a few suppliers and make arrangements with those you choose in preparation)
• Create social media pages and begin engaging with your market
• Register the business, hire a legal advisor and an accountant
• Find Employees (it might be just you in the very beginning, but a successful business is not something that can be done alone. Find a trusted business partner or a selection of capable employees to get things started.)
• Secure your space (whether it’s cleaning out a room in your house or buying a building, make sure you have the space and get it ready for operation)
• Launch! Sitting around and preparing will only work so long. It’s time to open business, good luck and work hard.

About the Author

Kate Critchlow is a freelance writer currently working with various suppliers to provide information for everything from cardboard boxes to business.