If you own a business or if you re considering an opportunity to buy one or start one it s probably because you have a product or service to provide to your marketplace for which you either have proven or believe that you have the requisite talents or skills needed in order to operate the business. Small businesses are the lifeblood of our economy. Without them, our country would never have become as great as it has. The greatest success stories are those of business owners who started from their garage or kitchen table, and the spirit of entrepreneurship continues to be one of the key ingredients in realizing the American Dream.
Unfortunately, the majority of small businesses fail within a few years. There are several reasons for this, but ultimately, success or failure hinges on the following key factors:
Do you have a sound business plan? It doesn t have to be complicated, but you better make sure you ve done your research and due diligence homework first. And be ready to act when changes in your plan are needed. Be careful not to underestimate the potential problems you may encounter or overestimate the potential financial rewards. Always provide for contingency plans in the event things don t go as expected, and be certain you have an exit strategy in place if and when it is needed.
Are you willing to invest a lot of uncompensated time and effort to achieve success? Even the simplest business ideas may require significantly more effort than you realize.
Do you have access to enough financial capital to sustain your business? You may not need much financing, but you better have access to it when you need it and be aware of the risks involved. If your ship starts sinking, it may serve you better to abandon ship and cut your losses rather than try to bail it out.
Have you made the most of your marketing and sales efforts? This determines your top line revenue potential. Without sufficient sales, it is obvious that no business can succeed. Find your niche and stick to it. Once you find it, chances of continued success are always better when you know your limitations and stay focused on what works best for you.
Do you have the labor and management help you need to operate the business? Sales mean nothing if you can t sustain your daily business operations.
Do you have appropriate and timely accounting and bookkeeping controls in place? This is critical to evaluating your bottom line profitability, yet it s often one of the most ignored or overlooked aspects of managing a successful business.
Is your return on investment sufficient to warrant your commitment of time, money and effort? You need to know what level of achievement constitutes your definition of success in order to measure your progress.
And last but certainly not least do you derive personal satisfaction and enjoyment from running the business?
It is imperative that you carefully consider and revisit these questions when operating any business, to prevent your American Dream from turning into a nightmare.
Author Resource:-
R. Gunnar Gelotte is a semi-retired Phi Beta Kappa honors graduate of the College of William & Mary in Virginia, with over 25 years experience as a corporate controller and personal money manager. He currently resides in Nashville, Tennessee.
For an easy and comprehensive way to help you plan for and manage your personal or business finances, visit http://www.MyMoneyManagementTools.com
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