One of the goals of starting a new business is to create profit out of it. It may be difficult to make it break even from day one, but with the right strategy and proper planning you can get a good head start. To make this possible, we believe that you need to take four steps in your strategy to help ensure that you are getting compensation for your hard work: setting measurable goals, defining your minimum value proposition, crafting a business plan and knowing your numbers.
1. Set milestones for your business.
Goals are defined as targets that one wishes to achieve while milestones are actions and achievements to make progress towards goals. To set your business’ goals, you must first decide what resources you need to get started. Once you’ve listed them down, split them into categories then decide on which ones to prioritize. From there, you can decide on short term and long term goals, strategies on how to achieve them and time frames as to when they should be achieved.
These written objectives are your milestones: sales goals, profits and numbers of followers on social media to name a few. Milestones act as indicators of how you are doing as a business and will let you know which strategies to change or keep. With numbers, you can easily identify if your strategy is working or not and make changes to help you grow.
2. Build something that works now.
Most would think that an MVP is a tangible product but it’s not. In fact, it’s a process that’s being used intelligently today in the form of crowdfunding platforms like Kickstarter and Indiegogo where an idea or a prototype is being sold before it is produced. This “build-measure-learn” feedback loop is a smart way to test your products’ viability and lets you learn about your customers, your market and your strategies in the fastest way possible.
To simplify, what you need to do is figure out a problem that needs to be solved, identify who will benefit from it and develop a product or a prototype as a solution to the problem. Set a price for your services and focus on the value it will bring to those who will purchase it.
3. Create a simple, manageable business plan
Creating a business plan doesn’t have to be complicated. It answers a few questions about what your business is about, who your clients will be and what solution you plan to offer that will solve a problem they have. But simple does not equate easy, because your business plan should be well thought of, well researched and well-designed.
Your business plan can be a one pager, but should answer these important questions:
When done right, your business plan can become a tool you can use for marketing, for getting new opportunities and even attracting the right people that your team needs. For an in depth discussion of what a business plan is and how to create a business model for your idea, join us on November 10 and 12 and sign up here.
4. Do the math.
Numbers don’t lie. It gives you an accurate view of how your business is doing. To do this, you must have a basic understanding of cash flow and manage your finances for you to get a clear vision of your profits and losses. Key performance indicators (KPIs) will help you determine your business’ growth over time like conversions, sign ups and sales digits. Understanding these digits will help you evaluate your strategies and increase the chances of your business’ survival.
Learn more about how you can simplify balance sheets for your business with one of our upcoming workshops, Business Planning 101: Simpifying Numbers happening on December 1 and 3. Click on the link for the details.
Herlene Somook is a creative entrepreneur based in Manila, Philippines. A graduate of AB Psychology, she was a Kumon Reading teacher for five years before jumping ship to the Business Process Outsourcing industry. She has been a digital nomad and freelance writer for a little over two years, and enjoys reading bedtime stories to her bouncing toddler.
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