5 Tips for Starting Your Small Business

After three plus years of living in South Africa it has become clear that there is no stopping the entrepreneurial spirit. In just the last few months I have worked with a number of friends and colleagues in setting up their small businesses catering to unfulfilled niche markets. While starting a business from scratch and getting a steady revenue stream is never easy, below are five tips and tricks that will definitely ease the operations, management, growth, and general admin of a startup SME.

Get that business plan drafted

Oddly enough there is a bit of a debate about the validity of the business plan. There are articles on sites like Forbes, and Entrepreneur that argue both for and against writing a business plan. My advice is to write it and use it as a validation of your own concepts and ideas. In its most basic form a business plan will give you a base for your business including detailing your product or service offering, who you will sell to, where you will sell, who is your ideal customer, your competition, and various long-term and short term assumptions about your strengths, weaknesses, opportunities and threats. The other advantage of a business plan is that it serves as a proof of concept for you to bounce your ideas and assumptions off your partners, advisors, and investors. Writing your business plan will also assist you in understanding how well you know your own business and where you want to go. Also, and often mistaken, a business plan is a living document and you will find yourself constantly editing and tweaking it as your business grows.

Register the business and open a bank account

Separating your personal address, expenses, and tax liability from your business is generally a good idea just for the sake of sanity. In South Africa, you have to have a separate entity for your business in order to get a bank account, various registrations, and certifications (e.g. B-BEEE). Having a valid business entity is going to be to your advantage come tax time, employee bonus time, or investor take on. Enabling the small business with a business banking account will also make automated accounting easier which I will talk about shortly, in addition to allowing the business to establish an independent credit history, and access to other business banking features like treasury management and cash investing. Having a business banking account will enable the business to save and invest, project cash flows, and keep inflows and outflows in order.  

Pick a cloud, any cloud

In 2015 being in “the cloud” is probably the most cost effective way to procure the business essentials required to manage the day-to-day and conduct business. Of the many cloud offerings available to provide you with the business basics of basic office software (documents/presentation/spreadsheets/instant messaging/etc.), Google and Microsoft have two of the most popular and easy to integrate options. Honestly you cannot go wrong with either ecosystem as they both provide access to online and offline office software, email, websites, and basic user and device management for between R60 - R170 per person per month. Integrating with the cloud also enables you to connect other services using the same authentication and security provider. Accounting, HR, payroll, CRM, and even developer environments and collaboration can all be authenticated using the same cloud account which makes integration and user/resource management a job that does not require full-time IT staff. Most cloud providers also offer various upgrades that scale in cost and functionality as your business grows.

Get the numbers down

Probably the least fun and arguably most important part of running your business is proper accounting and bookkeeping. Thankfully, because of the ubiquitous penetration of internet access and the use of cloud delivery, there are a number of accounting packages to choose from. Common in 2015 are low and no cost accounting services that will integrate with your bank(s) and credit card(s), enable e-invoicing, track receipts, track budgets, and enable an accountant to login and manage/extract data for regulatory, audit, and tax filings. Imagine being able to list your products/services, send and track invoices, track employee time, and manage payroll all from a single application that is accessible wherever you are. Add in the ability to enable your accountant to have access around tax time all for less than the cost of your cell phone per month and give your business solid accounting functionality with minimal expense.

Employee/Client/Relationship/Project Management

Every business needs a CRM… full stop. If you have clients then you cannot afford not to understand who your clients are, when you spoke to them, what they bought, what they want, collaborate internally, and give yourself an organized pool of information from which to draw valuable insights for your business. Thankfully the cloud again has solutions that are specifically catered to the small business. CRM, Project Management, and HR are offered for low/no cost and will integrate into your favorite cloud provider. Understanding why you are less successful in one product or service versus another is one of those “AH HA” moments when you realize how valuable the CRM is to your business.

There has honestly never been a better time in the last 20 years to be an entrepreneur (especially in Africa), and modern technology has enabled business services that are easier to use and lower cost than ever before. Hopefully these tips will help you in building your future enterprise.

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