According to a recent study, more Americans are self-employed than ever before, with nearly 16.8 million people identifying as self-employed last year. It’s not hard to see why this career path is an attractive one. Perhaps the biggest draw of entrepreneurship is that it offers flexibility, allowing people to create their own work schedules and have greater control over their income and work-life balance. It also provides people with the opportunity to pursue their passions.
Whether it’s launching a creative freelance business or starting an online store, self-employment allows you to turn your unique skills into a viable career, and with the digital age making it easier than ever to connect with clients and customers, the possibilities are essentially limitless. But that’s not to say the process is an easy one.
On the contrary, if you’re looking to begin a self-employed business career, you need to be aware of the challenges that come with it. In another study undertaken earlier this year, it was discovered that 20% of new businesses fail within the first two years, while 45% of new startups don’t survive the fifth year. To avoid falling into this category, we’ve listed out X tips that can help you navigate the arena and put all the necessary safeguards in place to ensure your business is a strong one.
First Off, Get Insurance
The first thing you need to do is insure your company. While there could be many reasons 20% of businesses fail in just two years, a crucial factor that insurance helps address is unexpected risks. No matter how much planning you put into your SME, the truth is, you don’t know what’s around the corner.
While you might have a smooth incline, there’s every possibility something might happen that threatens to drain your finances and derail your business, but with the right business insurance in place, you can work to protect your assets and grow your business without the fear of it all being undone.
Understand Your Finances
Insurance is crucial, but it’s not the only area you should be allocating your budget. In the beginning, you’ll be making numerous investments that help to build your business steadily and get you into a position to make an impact in your chosen industry, and this can go wrong if you don’t manage things effectively.
As an SME owner, you should know at all times exactly where the money is going and how it’s going to make a difference. This involves tracking your income and expenses, setting money aside for taxes, maintaining a cash reserve for unexpected costs, and more. If you don’t understand your finances and how they are being implemented, you risk running into cash flow problems that could stall or even end your business entirely, so make sure you have a good strategy in place.
Have a Time Strategy
Speaking of strategy, one pitfall many SME owners fall into is failing to have a strategic time strategy that helps them prioritise their tasks and maintain productivity. One of the biggest killers in the business landscape is time wasting, with failing entrepreneurs mismanaging their time and getting overwhelmed by the sheer number of responsibilities that come with running a business.
A well-thought-out time strategy – coupled with the best time management tools – can be the difference here. With techniques like time blocking, setting deadlines, and using productivity tools to keep you on track, you can work to manage your time effectively and make consistent progress towards your goals, without being bogged down by the little things. That’s going to be hugely important when it comes to focusing on high-impact activities that are going to make a difference.
Conclusion
Of course, there are many more tips and tricks out there, each of which will give you a little bit of a push when it comes to building a strong business. But if you can follow these tips off the bat, you’ll be putting yourself in a very strong position very quickly.
