Blog entry

Smooth Sailing…How to keep your start-up afloat that first year

“To reach a port we must set sail –Sail, not tie at anchor -Sail, not drift.” 
― Franklin D. Roosevelt

 

How do you improve the odds of your small business surviving the first year of start-up? Here are some tips for smooth sailing into the second year of business:

First piece of advice would be to ensure that you have a business plan. It’s often mistaken that a business plan is only required for those looking for financing with a bank, an investor, or grant opportunities. A business plan is so much more than just a tool for financing; it is a map that outlines the direction of your small business. It generates a vision and keeps focused on where you see your business over the next 2-5-10 years. A Business Plan doesn’t need to be professionally written, nor does it need to be a 200 page polished document, it can just be a standard start up plan that outlines your vision and the financial forecast for your small business.

Our second piece of advice is to try and keep your overhead costs as low as possible in that first year. Work the business yourself instead of hiring staff, and if you do have to hire someone try to do it as a work experience arrangement, volunteer opportunity, on call or contract basis. Another tip on this topic is find a location that fits your ‘needs’ not your ‘wants’, look into shared space leasing or pop up locations, once your business has generated some steam, then start looking into commercial leasing options. Try to keep your overhead as predictable and within budget as possible during the first year.

Third piece of advice make sure you have enough startup capital, you need money to get your business up and running and you need a “nest egg” to cover your business for that first year and until its starts to generate its own income.  One of the major contributors to the failure of a small business within the first year is being under financed.  

Finally during your first year try to realistically reinvest as much as you can back into the business as possible. This is pivotal during your first year of start-up, that first year will not be about fattening up your own personal bank account, but more importantly the marketing and building up your business brand or services. The more you reinvest into your business that first year, the stronger your foundation will be for the years to come and the smoother the sailing will be into your second year of business. 

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About Community Futures

For over 25 years, we’ve been fostering entrepreneurship in rural BC. We offer small business loans, business counseling and specialized programs to help you start or grow a business, and to help communities become more resilient and dynamic.

266 Oliver Street
Williams Lake, BC
V2G 1M1

Phone: (250)392-3626
Toll free: (888)879-5399
Fax: (250)392-4813