By Hannah Whittenly
If you are a small business owner, you likely know the importance of those first few years. In fact, you have planned for a likely loss in order to grow and establish the business that you have poured your heart and soul into. If you plan and implement an effective strategy, you can weather those difficult times and emerge victorious on the other side. Here are some tips to help you keep your small business from going bankrupt in those first few years.
Maintain a Day Job Early on
Depending on your current position in life, it might be beneficial to you to keep you day job early on while you build your business. This will preclude from having to take a salary for your new business, providing you with much needed funds to pay for business expenses in those early years. It will also provide you with a stable income yourself, which is important from a stress management point of view.
Begin the Business from Your Home
A big expense for small businesses can be physical location. You can avoid this by running the business from home for as long as possible. This has the added benefit of possible giving you a big break on your taxes, which is always an added bonus.
Make Sure the Business is Recession Proof
Some businesses are cyclical. Try to begin one that is not. You do not want to be prone to the whims of the economy, as if a recession were to hit during those early years you might find yourself in bankruptcy in order to fend off the creditors.
Beware of Hidden Expenses
Make sure that you allocate funds for every possible expense. This ranges from the expense on your credit cards to utility bills. Some of these expenses can take a chunk out of your monthly budget, so it is important to know about them up front so that you can plan for them. This will help you weather those early years because your have a solid plan behind you.
These four strategies are aimed at helping small business owners weather the tough times that inevitably come about in those early years. Remember to plan and strategize from the outset. You cannot account for everything that might happen to you, but you can at least be ready for any adversity as it strikes. This will help your business be successful and keep you out of bankruptcy.
Hannah Whittenly is a freelance writer and mother of two from Sacramento, CA. She enjoys kayaking and reading books by the lake.
