How to run a business so that it doesn’t fall apart, barely having time to start? This is a question that worries both novice businessmen and owners with a certain amount of experience and knowledge. Any enterprise is the result of the active work of the leader and the team.
However, in addition to this, the organization is a kind of reflection of the owner’s personality: his principles, convictions, decisiveness, energy, ability to calculate the situation in advance.
Therefore, the first thing to start with is changing the way of thinking. The owner must have an ownership approach, because it is almost impossible to achieve sustainable progress by evaluating the development process from the point of view of an employee.
How to do business: the most important
A lot of tales about the incredible complexity of entrepreneurship are circulating in the philistine environment: high competition, the state stifles taxes, regulatory authorities – checks and fines. In part, these rumors are true, but practice shows that most often startups are burned out not because of the aggressive external environment, but because of the erroneous actions of the management.
Where to begin
Non-profitability in the first months of the company’s promotion is completely normal. However, a surprisingly large number of people start a business without even trying to break even. Meanwhile, this does not require any daunting calculations: just add up all your monthly costs, and then calculate how much goods or services you need to sell in order to at least not go into negative territory.
Another common mistake is striving for a perfect start: an office in a prestigious area, high-tech equipment, a strict dress code for employees. In fact, it is much more important to make sure that your products are in demand: if there is no demand for them, then in a couple of months you will be forced to sell your first-class equipment in order to pay off the loan payment.
So how do you run a business to be successful? The answer is simple: your focus should be primarily on customers and sales.
A banal truth: there is no business without clients. However, many aspiring entrepreneurs do not think about any specific schemes for attracting a target audience, hoping that the buyer will come to them himself. This approach only works in very few business niches, and besides, sooner or later you will be replaced by more entrepreneurial competitors.
About half of your time should be devoted to working with clients. This concept includes several aspects:
- attracting new customers;
- work aimed at increasing the number of repeat purchases;
- analysis of selected tactics, analysis of mistakes.
Pay attention to sales techniques: up to half of the purchases are made under the influence of an emotional impulse, and then a state of “hangover” sets in – a person begins to reflect on whether he made the right choice, whether he was wrong. A salesperson who takes the time to instill confidence in the company can be sure that for the next similar purchase, the client will return to him, and not be tempted by a competitor’s proposal.
Useful techniques for doing business correctly in trade
- Respond to client requests as quickly as possible. If at the moment it is not possible to solve the client’s problem, indicate the approximate time frame when you will be able to contact him. A potential buyer should know that his request has been seen, held in priority, and a solution will follow.
- Make concessions. If the client asks to add some kind of work to the standard package, do it, of course, on the condition that it does not require a lot of time, labor or financial costs from you. Demonstrate loyalty.
- Fix your mistakes. There is no surer way to lose a dozen potential buyers than to deny one of them a solution to any problem after the sale, formulating the refusal in the spirit of “everything worked for us, now these are your difficulties.”
- Take the time to dialogues. The client does not own your terminology and information about production processes. Ask clarifying questions, say all the necessary points in order to achieve mutual understanding.
- Follow your obligations. Always.
Of course, the business owner should not completely close the functionality of the sales department, after all, the business owner has a slightly different range of key responsibilities. Ideally, the situation should look like this: you analyze the results of the previous period, plan a strategy for the future, determine the main directions, set the work standards. And you delegate the implementation of specific tasks aimed at fulfilling the plan to your team.
It is not enough to interest and attract a clientele, it is necessary to build an effective sales system, and do it constantly, since the conditions of the external environment are constantly changing.
The sales system implies both the management of business processes and the employees who carry out these processes. Based on this, it is possible to determine the main components of building a sales management system.
- Target audience definition. It is necessary to compose a description of your strategic segments: which segment of the population will be interested in your products; which areas are likely to be in high demand; what is the level of solvency of your target audience. Let not immediately, but it is advisable not to postpone the preparation of plans to enter new niches.
- Designation of distribution channels: determine the most profitable points of sale; collect information on channel members (intermediaries, carriers); evaluate the profitability of working conditions in these areas; correlate the costs of maintaining the channel with the size of the estimated profit.
- Organization of the sales department: define goals, objectives, functions; approve the state; prescribe instructions, regulations, standards; to consolidate the systems of motivation, assessment, control.
- Implementation of after-sales service: organize a service corresponding to the specifics of the activity; introduce accounting and processing of customer data in order to be able to generate a stream of repeat sales.
Tools such as drawing up plans and sales reports help the owner to control the situation and quickly make the necessary adjustments.
How to learn to run a business? Entrepreneurship is an area of activity that is not taught in any school of economics: in addition to theoretical knowledge, creativity and a set of personal qualities play an important role here. Therefore, the path of formation of each individual enterprise is unique.
However, there are some aspects of entrepreneurship that are quite amenable to study, and it is advisable to assess their value and master the skills of working with these tools before you register an individual entrepreneur or LLC.
Accounting and reporting
Alas, no matter how much you rely on intuition and business insight, a reporting system is essential for successful business. We mean not only the tax burden, but also the organization of the management of financial flows. In small enterprises, the functions of the head of the finance department are usually performed by the owner himself; in larger organizations, the cash flow management system is separated into an independent department.
The owner may not have accounting skills, but must navigate the main types of cash flows in order to understand what promising sources of income he has and where the profit actually goes.
- Inputs: sales of products, sale or lease of assets, repayment of receivables, advances from buyers.
- Outflows: payments on loans, payments to employees and suppliers, mandatory contributions and payments to various funds. < / li>
Any enterprise must have a goal of its activities, it is necessary to understand that profit is, as it were, a by-product of work to achieve strategic goals.
With a global goal in front of your eyes, you can plan the activities of the company, breaking the path to achieving the ideal into a series of operational tasks. For example, let’s say you strive to become the number one sales leader in your region. What needs to be done for this, what steps should be taken?
Make a clear, detailed plan for the next six months or a quarter: write what actions should be carried out, the timing and results of their implementation. At the end of the period, you will be able to analyze and evaluate the success of your actions. How to conduct an assessment? According to the system of indicators.
Probably, it will not be a great exaggeration to say that the success of a company is largely determined by the set of personal and professional qualities of the team, the collective. However, even if you can attract the most talented people to work, it will be difficult for you to succeed without a well-structured management system. How to run a business if the owner is forced to constantly personally explain, accompany, control? No: you will be overwhelmed with solving current issues, rather than developing a strategy or seeking new ideas.
Simply put, a management system is when each employee knows when, in what sequence and what work he must perform in order to get certain planned results.
The control system includes
- all specialized departments, as well as vertical and horizontal lines of communication between them;
- business processes that ensure the functioning of the departments;
- a documentary description of the functionality of positions, interaction rules , corporate ethics, the sequence of actions of a particular business process;
- personnel as an object of management;
- IT technologies.
Since a management system is an intangible value, it is quite difficult to assess it, and therefore, it is difficult to draw up a list of requirements that your management mechanism must satisfy.
When assessing the effectiveness of your corporate governance system, you can rely on the principles formulated by management theorists
- setting clear goals;
- attitude towards the team from the standpoint of respect, fairness and common sense;
- constant, accurate, competent accounting;
- standardization of instructions;
- care of working conditions;
- coordination of actions;
- fair and timely reward system.