Business Profitability: Are You Prepared To Achieve It? Part 1
Linda P. Morton
Every new business owner wants good business profitability. Face it! If there's no profit, there isn't a business for long. So before starting your own business, ask yourself if you have the skills needed to attain business profitability.
Six skills are needed to build business profitability:
Financial Skills Needed To Build Business Profitability
Idea Generation Skills Needed To Build Business Profitability
Planning Skills You'll Need To Attain Business Profitability
Management Skills Needed To Build Business Profitability
Marketing Skills Needed To Build Business Profitability
Customer Relations Skills You'll Need To Attain Business Profitability
This article covers the first three of these skills. Part 2 will cover the last three.
Financial Skills You'll Need To Attain Business Profitability
Even if you pay employees or professionals to do your accounting and bookkeeping, you still have to stay on top of your business finances. If you are to build business profitability, you must know at all times how your business is faring financially.
As a business owner, you have to understand financial statements and know what financial terms mean to your business. You also have to use business credit with caution.
You'll most likely need a small business loan within your first few years of business, but you have to understand your finances well enough to be certain that your business cash flow can make the payments.
Have you thought about business insurance? You have valuable small business resources that could have to be replaced. Can you afford to replace them without insurance? Have you thought about how you will motivate your employees? How about profit sharing?
Idea Generation Skills Required To Reach Business Profitability
It's your business, and you are responsible for selecting the best idea from the many business opportunities available. You must choose one that has the best potential business profitability.
Plus it's your ideas that will that will determine the effectiveness of your planning, marketing and customer relationships.
You may have lots of ideas, but you have to carry through and implement those ideas to build business profitability.
Planning Skills To Build Business Profitability
Implementation first requires business planning. Then it requires working your plan.
You have to plan for business growth. It doesn't happen if you don't plan for it. Do you need help with your planning? You can get it free from SCORE. Sponsored by the Small Business Administration, successful business owners offer free assistance through SCORE. If you need help, get it either through free sources like SCORE or through paid coaches.
Do you think that the only reason to write a business plan is to get a loan? If so, think again.
Your business plan is your map to business growth. The financial part of your plan can guide business growth and lead you step-by-step to business profitability. The marketing part of your plan outlines how you will get customers, and your planned policies can assure that you keep them. Your business plan should also outline your business procedures and processes to guide your and your employees' day-to-day activities.
Without a business plan, you will be ill prepared to manage your business so that it will earn a profit sooner rather than later.
Synthesis
Financial, idea generation, and planning skills will get your business moving toward business profitability. Management, marketing and customer relations skills keep it moving toward you business profitability goal. Read how in part two of this article series.
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