There is no shortage of articles, seminars, and textbooks that claim to tell you how to run a successful small business, but few of them define exactly what it means to succeed. Yet it’s important as a small business owner to know what you’re striving for every day so that you can stay focused on your goals.
What are you hoping to achieve with the long hours, the risks, and the sacrifices that come alongside running your own business?
For each SME owner, the answer will be different, given that some simply want to provide a good living for their families, others want to inspire their customers, and many hope to change the world with a new way of doing things.
That said, most successful businesses have a few things in common.
Here are a few ways that you’ll know that your company has grown from a shaky fledgling into a successful and sustainable business.
1. Your cash flow is healthy and you’re starting to see consistent profits
When you start a business, you can usually expect to lose money for at least a few months. Your start-up expenses, such as stock, equipment, marketing, business services, rent and overheads will initially be higher than your revenues. When you start to see a healthy stream of revenue into your business, so that you’re able to cover most of your expenses from cash flow each month, you’ll know that you’re on the right track.
And after a consistent few months where you are making a profit rather than a loss, you’ll be sure that you have a sustainable cost base and that there is a demand in the market for your products or services. Each month and each year that you’re able to sustain and grow profits vastly increases the odds that your business will survive and thrive into the long term future.
2. Your customers are saying good things about your company
Listen to what your customers are really saying about your business – use an informal survey (tools such as Survey Monkey can help), social media monitoring, and face-to-face interaction to find out what they think about your service or product. If they’re satisfied with your offering, then you are resonating with your market and have a strong base for the growth of your business. Repeat business from the same customers speaks even louder than social media praise – if they keep coming back for more, you’re definitely doing something right.
3. Your employees are happy and your staff turnover is low
Another sign that your business has established itself is if you’ve managed to build a strong core team that has stayed with the company for a couple of years. If your people are happy, then your business is probably growing. And the longer they stick around, the better they will get at what they do.
4. You’re happy that you’ve done the right thing with your life and your career
Many business owners are motivated by money or the flexibility and independence that comes from being their own boss; others love the prestige of entrepreneur awards or the buzz that comes from making a difference in the community. These are all valid metrics for success.
If you feel that you are doing the right thing with your life when you look at yourself in the mirror each morning, you’re doing well. There are moments of self-doubt and difficult periods in any entrepreneur’s life, but if you wouldn’t easily trade what you’re doing for anything else in the world, your business is on the road to success.
By Steven Cohen, Head of Sage One AAMEA (Africa, Australia, Middle East and Asia)