There are of course many other areas that can be considered as being basic, but rather than examining each and every one as a separate topic it is perhaps more beneficial to consider them briefly in one final article in this series.
- Systems and procedures – every business of any size will operate much more efficiently and effectively if it has good systems and procedures in place. Whilst these do of course take both time and financial resources to put into place, nevertheless, the earlier they are implemented the easier it will be, even allowing for the fact that these will need to be updated as the business grows. Many early-stage businesses leave putting in systems and procedures much later than is optimal and this reduces efficiency until they are in place and increases complexity and cost when implemented.
- Cybersecurity – It is not only large business that can be hacked and suffer substantial financial and reputational damage as a result; or even be put out of business. So many start-ups do not even take basic precautions. Tesco has just concluded an exercise that suggests a major cyber attack could cost it £2.4bn and they do of course have sophisticated cybersecurity in place. Any start-up needs to ensure that it takes cybersecurity precautions from day one, and that the level of sophistication grows with the business.
- Karma – Treat all staff, clients, business partners, and everybody else that you deal with in your business with respect and humility. Do the right thing for the right reason. Good reputations take a long time to build but can be easily lost. Doing the right, or the wrong, thing will almost certainly come back to you one way or another.
- VAT – Consider registering for VAT even before you reach the threshold, as for many businesses selling B2B this can be beneficial as it means being able to reclaim VAT on your costs sooner, and your VAT registered buyers can reclaim any VAT you charge on your goods or services. If, however, your sales are to retail and other buyers that are not VAT registered then it is often best to wait as it will increase your prices and / or decrease your margins as well as potentially reducing sales.
- Look around you – never forget that you must always be aware of what the competition is doing and seeking ways to improve your own offering; either to keep up with the competition or, preferably, to stay ahead of it. Constant research, not only of the competition, but also of changing trends in the market, will help you to ensure your business does not lose its way. Always look to adapt and even pivot.
- Work ‘on’ the business and not just ‘in’ it – that is, as a founder, it can be all too easy to get caught up in all that is necessary on a day-to-day level to just make the business survive and to grow. When working in an early-stage business it can be difficult to take that step back and to look at the overall strategy and to work on the bigger issues that will drive the business forward. This is often an area where it pays to bring in an outside advisor to help to guide you through the process and develop your thinking and then to start to implement this.
Wherever you are in your entrepreneurial journey, whether you are just at the concept stage, established but going back to basics, or scaling rapidly, there is a lot of help available. One such source of help is my ‘Start-up to Scale-up’ book. But whatever steps you choose to take, if you get the basics right then the rest is certainly easier.
17th May 2022