In their first few years of operation, small businesses are in a very precarious position. Not only do entrepreneurs need to go through the bureaucratic, strategic, and mundane work of getting their business running, they also need to satisfy startup investors and lending institutions, and attract new investment. Those who don’t often rely on personal savings and investments by friends and family members to launch their businesses, which places them under even more personal pressure.
Launching a business that has something to offer to its target market and its industry is a tough job regardless of the circumstances. Becoming profitable in a competitive economic environment before your startup funds run out is another issue entirely. The critical element is time, both in terms of timing and time management. Entrepreneurs have a very limited amount of time, and they need to determine exactly how to spend it most efficiently if they hope to make the cut.
1. Make time for growth
Startups in their initial stages can almost never turn a profit. In order to become profitable, they need to scale up their operations and become more efficient. In light of this, new business owners need to invest their time in planning and driving their business’ growth. Unfortunately, this critical goal often falls by the wayside under the weight of more immediate concerns. Business owners juggling late client payments, equipment breakdowns, interpersonal workplace drama, and managing customers often simply forget. To avoid this fate, entrepreneurs need to outsource unnecessary tasks to make time for those that require their attention.
Use financing to manage working capital
The typical Australian business owner spends 8 hours per week chasing down late payments. On top of that, business owners need to come up with funds and juggle other financial obligations in order to make ends meet to handle the resulting cash flow interruptions. Fortunately, this lost time can be recovered entirely by using the proper financing tools. Financial institutions like Fifo Capital offer invoice financing, supply chain finance, and unsecured business loans that, depending on your particular situation, can be used to quickly manage financial shortages.
In the case of late payments, invoice financing not only allows businesses to immediately get paid for their outstanding invoices, it also outsources the task of collecting payment to the financial institution. This gives entrepreneurs the time they need to strategise and pursue growth for their business without worrying as much about their bottom line.
2. Don’t wait to start marketing
One unavoidable aspect of every growth strategy is marketing. A business that no one is aware of won’t be able to grow quickly. Unfortunately, many business owners wait until after their business is up and running before they begin to worry about marketing. This is a big mistake, and often results in otherwise viable businesses going bankrupt before they even have a real chance to assert themselves.
It takes months or years to develop brand recognition, to build connections with other businesses, and to build an online presence that meaningfully generates leads. Getting the attention your business needs to not only survive, but to grow, is incredibly difficult to do with a time limit. Successful startups start marketing as soon as possible, and budget strategically to ensure that their marketing campaign can be sustained long enough to begin generating enough leads to pay for itself.
3. Start innovating early
It can be tempting to wait until your new business is established and profitable before devoting time and funds to innovation and experimentation. Unfortunately, doing so can rob a startup of an important advantage. Innovation and novelty is the lifeblood of all startups, and entrepreneurs need to lean into it if they hope to disrupt their industries. Because they’re still small, they can rapidly experiment with new ideas and adapt to new situations in unique ways that larger competitors can’t.
While larger businesses can afford research and development teams, their efforts will largely be focused on optimising existing tools and methods. Changing too significantly, or too quickly, means accepting the loss of any sunk costs, and losing any returns on those investments. New businesses, on the other hand, can make sweeping and transformative changes without suffering any such costs, or being forced to manage conservative-minded investors or board members.
Successful entrepreneurs aren’t just abstractly aware of what it takes to run a business. To establish something new, to grow, and to become competitive, they need to be masters of time management. Critical tasks don’t just need attention and resources, they need these in the right proportion at the right time in order to produce results. Poor timing can leave an otherwise viable business bankrupt, while excellent timing and time management turn even anaemic and underfunded startups into successes.