Build a Better Business in 2021: Basic Tips and Strategies
It may not seem like it, but now could be the best time to start a business, even amidst a pandemic. A successful business now makes a huge difference. For some, it’s the key to making ends meet. For others, an opportunity to thrive. The question is, in the time of a pandemic, how do you actually build a better business?
Maybe you’re thinking about starting a business because of necessity. Maybe you’re already a business owner and thinking of ways to improve your business. Regardless, it’s good to really sit down and think about how you want to go about this.
Let’s get back to basics. Here are a few tips on building a better business in 2021. For new business owners, hopefully you can get some ideas on how to actually start building your business. For seasoned entrepreneurs, here’s a quick refresher on some things you should already know. Hopefully you find value in these simple tips, and hopefully these help you succeed!
Do What Excites You
The first step in any venture is to stop and think about why you want to make a business in the first place.
Is it really just about the money, and about making ends meet? Nothing wrong with that – that’s a big reason why people enter business in the first place. However, maybe there’s something deeper that drives you. Creating a business about something that you are passionate about makes a huge difference.
It’s easy to jump on trends, and start copying what you’re seeing as popular. This is especially true in the food industry. We saw an abundance of ube cheese pandesal and sushi bakes cropping up last year. But there’s such a thing called first mover advantage. There’s probably too much competition already on those trends, and maybe it’s time to start something new so that you’d get that advantage as well.
First tip to build a better business – think about what excites you, and think about sharing that with your potential customers. Maybe you like helping people and giving them advice – why not start a freelance consultancy? Or maybe you’re the creative type and was laid off from your day job – maybe it’s time to start earning from your art? That passion will give you that extra push to succeed. It’ll making waking up every day easier.
And hey, if you’re really passionate about sushi bakes and think you can do a better job than all those people who are currently doing that, then by all means, go. But find a new spin to it. Do what excites you, and connect it to how it can excite others.
Think Local, Find Your Niche
Businesses, first and foremost, provide value. It’s an exchange for goods and services. If people do not see value in what you are providing, then you are doomed to fail.
A good starting point is to think local – what does your immediate community need? Are there any pain points in your community that you can address, and that people could pay you for? It could be as basic as giving people new food options, and as complicated as providing a specialized service that only you can give. That’s how you build a better business: find your own unique selling proposition, and lean in.
Also, that “immediate community” is not just limited to your barangay or village – it could be a group that you are completely immersed in. Maybe you’re a car enthusiast and you’re part of some Facebook groups. Keep your eyes peeled and pay attention to what your community needs. There might be an opportunity there somewhere.
The point is to think about your target market, and find your own niche. You’ll also cut transport and shipping costs, maybe even rental in some cases. If you provide something that no one else can provide, then people would go to you, and only you – that’s a recipe for success.
RELATED: 2020 PH Economy Struggled, but is on a Path to Recovery
Remember, Revenue Isn’t Income
A pitfall that most new businesses experience is on the side of accounting. This is especially true for those who do not have any business background to begin with. People don’t track their expenses well enough, and think that all money that comes in is income, and they celebrate because they think they actually made money.
First step is to make sure that you record everything – and we do mean everything. A simple excel spreadsheet goes a long way. Even pen and paper will work. The thing is, you can’t assess what you can’t measure. You won’t be able to say that your business is doing good if you don’t have the data to show for it.
Here’s a basic equation that is the foundation of most businesses: Income = Revenue – Expenses. It’s a very important concept that some people don’t know or keep forgetting. Some people even confuse revenues with incomes, even though they’re completely different things.
Your income, or net income, equals all the money that you received for a period (i.e. your revenues, or gross sales) less all of your expenses. It’s a business school basic that is integral to success.
The point is, don’t confuse the money that’s coming in for money that you’ve already earned. In order to build a better business, you need to monitor everything. That way, you know exactly how much your expenses are, and so you know exactly how much of your revenue you should allocate in order to keep your business going. You can then move on and create budgets that would help you plan ahead, and it starts with being meticulous in recording everything. For those who want to do business on the side, think about the lost time, too. You’ll start taking up personal time with family, for hobbies, etc. There’s no quantifying that, but should always be kept in check.
Experience is the Best Teacher
Finally, the best advice we could actually give to build a better business is that there’s no harm in starting small. That way, if you do make mistakes, they’re not as punishing as when you go all-out at the start. In business, just like in life, experience is the best teacher.
Test the waters out and focus on small projects, or on just one particular product. The advantage of this is that you can both test it out and then build cash flow that would hopefully sustain you in the coming months. The point is to buy yourself some time to adjust as necessary, and get more information to improve your products and services.
At the same time, take this opportunity to learn. We have barely grazed the surface of what makes businesses succeed. There are a variety of free resources online. Or better yet, find someone you can talk to and ask about their experiences in starting and running a business. Knowledge is power in this case, and learning from other’s experiences is always a good idea.
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Hopefully these words of advice help you in your journey to build a better business in 2021. It is definitely a risk, but having a successful and thriving business is a rewarding endeavor in and of itself.
