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Starting A Business in A Challenging Economic Climate, Part 2 (Limiting Risk)

Starting A Business in A Challenging Economic Climate, Part 2 (Limiting Risk)

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    In Part 1 of this series, I talked about why now is a good time to start a business. But without Part 2, Limiting Your Risk, you may be setting yourself up for problems. Now is a great time to start a business, but part of starting a business in this kind of economy is playing it smart.

    How You Can Limit Your Risk:

    When you start a business in challenging economic times, you’ll want to limit your risk as much as possible. There are several ways to go about this, but here are my top recommendations:

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    Get it right at the beginning. A lot of budding business owners skip crucial steps on their way to a business launch. I can’t tell you how many clients have come to me, a year or two into their businesses, without having set up their companies with the Secretary of State, the IRS, or having met with an attorney to help them set up their operating agreements. These are things that could get you in a lot of trouble if you don’t do them the right way.

    There are other steps that won’t necessarily get you into trouble, but may cause some headaches if you don’t get them right. Branding is an excellent example of one of the most-missed (and most misunderstood) steps in entrepreneurialism. It’s also one of the things that can make or break your company.  Choose a generic business name like “ABC Consulting” or create a brand that doesn’t intrigue your target market and you’ll start your business heading down the wrong path.

    Choose an industry that’s hot or one that’s a “need.” Generally, you want to go with the industry you know best, but at the same time, you can’t ignore what most business experts define as the wave of the new future. Currently, the hottest trends are green businesses, health care, natural beauty, discount retail and luxury, credit and debt management, and technology. If you can find a way to spin what you already know into one of these hot business areas, you’ll take advantage of the coming upsurge in these industries.

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    On the other hand, I also believe in going after the “needs” of your consumers. For example, I once worked with a guy who was a chimney sweep in the winter (something people need) and a custom SUV builder in the summer (a luxury people want). His winter need-based business was one that provided enough income for the whole year, just in case his want-based business waned in the summer.

    Start with a low-risk business model. When I work with a client to design a new business, we typically use what I call a “leap-frogging” or “dovetailing” approach. This is where you start your business using a low-risk business model and build from there, using the income from the first model to fund expansion and growth into more complex business models. This approach almost always allows my clients to start their own businesses without seeking any type of funding from lending institutions, venture capitalists, or other investors.

    Plan ahead. If you lose your job, there isn’t much you can do about that. And in this economy, you’d have to work a part-time job in addition to your regular full-time job to save up enough for the six to twelve months of living expenses I generally recommend when clients want to start a business they can work full-time from the beginning. But if you can keep your job and start your business part-time, you’ll reduce your risk substantially. This allows you to maintain a steady income while you’re building your business, and eventually, you can make the transition to being self-employed, full-time.

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    Market research can save you a lot of time and heartache. Before you head into any business startup, you want to know your market inside out. More than that, you want to know your target market. There are lots of ways to do the research. You can do your own research (called “primary research”) or you can use information compiled by others (“secondary research”). Both have their pros and cons, but the questions you want to answer are:

    • Who is my target market?
    • What do they want?
    • Can I deliver it to them?
    • If I deliver what they want, will they buy it?

    Leverage free and inexpensive marketing methods to build your business. A lot of new entrepreneurs develop complicated, expensive marketing campaigns before realizing how many ways there are to get the word out about their businesses without spending a fortune. And with the power of the Internet literally at our fingertips, it’s easier now than ever to build awareness for your brand. However, that doesn’t mean you should go out and build a giant Twitter following. There are so many online options, but all of them may not be appropriate for your target market.

    Get the right help. Before you launch a company, you want to find professionals who can help you start on the right foot. There are countless people out there calling themselves “consultants” and you have to be careful who you choose. The ideal business consultant for you is someone who understands a lot of different business models, especially the low-risk ones, and who can help you figure out the model that suits you best. You want someone you find personable, someone who knows what they’re doing, and someone you can trust.

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    In addition, make sure they don’t make promises that are too good to be true. A lot of business “experts” I’ve seen lately offer what amounts to “get rich quick schemes,” while others offer such vague information that you’re compelled to keep buying more books and products to get to the “real” information….which never actually comes. Instead of wasting your time on these folks, find someone genuine, real, and honest, who may not promise you the sun, moon and stars super-fast, but who can help you build a solid, stable income with real growth potential.  Work one-on-one with them to develop a sound business model and a strong brand with a viable marketing strategy that you can easily implement. A good business consultant will know how to work with whatever budget you have and tailor solutions to your needs. Plus, they should have an army of other professionals who can also work within your budget, but still offer high quality work.

    Build your team. Speaking of other professionals, you will need your own little army. In addition to a business consultant, you’ll also want an accountant, an attorney, a graphic designer and a web designer, and you may also want a virtual assistant and some other consultants, most of whom your business consultant probably has access to.

    Starting a business in an uncertain economy can feel risky, and it certainly has stopped a lot of people from moving forward with great ideas. But if you look at history and remember that some of the most solid businesses today were started in just such an economy, mitigate your risk factors and hire the right professionals from the start, you’ll give yourself a fantastic leg up on your competition, and set yourself up for success.

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    Last Updated on December 10, 2019

    7 Strategies to Keep Employee Motivation High

    7 Strategies to Keep Employee Motivation High

    Highly motivated employees are essential to the success of any business. Most people spend a third of their lives at work.[1] That’s a significant amount of time away from home, apart from the people who make us happy and the things we love to do. So keeping employee motivation high is essential for creating an office environment that gets the best out of our people.

    But do you know what motivates your people?

    It’s simple:

    • Is their work stimulating?
    • Does it challenge them?
    • Is there room to grow, a promotion perhaps?
    • Do you encourage creativity?
    • Can they speak openly and honestly with you?
    • Do you praise them?
    • Do you trust your staff to take ownership of their work?
    • Do they feel safe in their work environment?
    • And more importantly, do you pay them properly?

    Every one of these factors contributes to the general happiness of your employees. It’s what motivates them to come into the office each day and work hard, hit goals, and get results.

    In contrast, an unmotivated employee is typically unhappy. They take more sick days, they’re not invested in seeing your business succeed, and they’re always on the lookout for something better.

    Stats show that 81 percent of employees would consider leaving their jobs today if the right opportunity presented itself.[2] So it’s up to you to set aside time and energy to create a work environment that benefits every one of your employees.

    These seven strategies will help you motivate your people to consistently deliver quality work and, more importantly, to stick around for the long term.

    1. Be Someone They Can Rely On

    You rely on your people to turn up to work each day, to come to you when they have a problem they can’t solve, to be honest, and to always engage professionally with customers.

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    But this is not a one-way street. You, too, need to be someone your team can rely on. They trust you to have their backs when a client is unreasonable, to know that the decisions they make are in your best interest, and to make good on your promises.

    If you say you’ll attend an important meeting, be there. If your company makes a profit and you’ve said you’ll pay a bonus, pay it. The goodwill of your people is something you never want to test, let alone lose.

    Be reliable; it’s astounding how much this motivates your people.

    2. Create an Awesome Company Culture

    There’s no denying that company culture trickles down from the top. Your leadership and attitude massively influences the attitudes, work ethic, and happiness of your staff. If you’re always stressed-out, overly demanding, and unreasonable, it’ll create tension in your office which will adversely affect your employees’ motivation levels.

    In fact, the HAYS “US What People Want Survey” found that 47 percent of staff who are actively looking for a new job, pinpoint company culture as the driving force behind their reason to leave.

    So if you have high staff turnover, you need to determine whether your company culture might be the motivating factor behind your churn rate.

    Here are four ways to build a culture that keeps your employees highly motivated.

    • Be conscious of the image you present. Your body language and attitude can positively or negatively impact your employees. So come to work energized. Be optimistic, friendly, and engaging—this enthusiasm will spill over to your people and motivate them to be more productive and efficient.
    • Appreciate your people and be reasonable. Celebrate your team’s achievements. If they’re doing a good job, tell them. Encourage them to challenge themselves and try new things. And reward when deserved. If they’re struggling, help them. Work together to find solutions and be a sounding board for their ideas.
    • Be flexible. Give your people opportunities to work remotely—this is highly motivating to staff, particularly millennials. They don’t want to be battling traffic each day on their way to work. They don’t want to miss their kids’ baseball games or ballet rehearsals. Stats show that companies that offer flextime and the ability to work from home or a coffee shop have happier and more productive employees.
    • Create employee-friendly work environments. These are spaces that inspire and ignite the imagination. Have you ever been to Google’s offices? No headquarter is the same. From indoor slides and food trucks, to hammocks, and funky work pods on the wall, gaming rooms, and tranquil interior gardens, there’s something for everyone. It’s a space where people want to be, catering to their need for creativity, quiet, or team building; you name it.

    So take a look at your company culture and ask yourself, Is my business an attractive workplace for talented professionals? Does it inspire commitment and motivate my people? What could I do to improve my company culture?

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    3. Touch Base with Your Team Weekly

    Make time for your people, whether you run a remote business or work in an office, set aside time each week to talk to your people one-on-one. It’s non-negotiable.

    When there’s an open line of communication between staff members, work gets done. Don’t believe me? A study by Gallup found that 26 percent of employees said feedback from their leaders helps them to do a better job.[3]

    Your people want to feel trusted. They want to take ownership of their work, but they also need to know that when they have a question, they can reach out and get answers. If you’re unwilling to make yourself available, your team will quickly become unmotivated, work will stagnate, and your business will stop growing.

    So block off time on your calendar each week to touch base with your people, even if only to let them know that what they’re working on matters.

    4. Give Them the Tools They Need to Do Their Jobs Well

    Imagine trying to run your business without electricity. How would you contact your clients? What would happen when your phone or computer battery died?

    Technology is super critical to the success of your businesses. It allows you to work more efficiently, to be more productive, and to handle matters on-the-go. That’s why you need to give your people tools that will make their jobs easier.

    Make sure their equipment is in good working condition. There’s nothing more frustrating than a laptop that takes ages to boot up. It’s got to go. Replace outdated software with new software. Don’t make your designer work in Coreldraw; give them access to the most up-to-date version of Adobe Creative Suite. Take it a step further and buy them a subscription to Shutterstock or Getty Images.

    Make working for you a pleasure, not a pain; and watch your employees’ motivation levels rise.

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    5. Provide Opportunities to Learn and Upskill

    Would you believe me if I told you that 33 percent of people cite boredom and a need for new challenges as the top reason for leaving their job?[4] If you want to retain your talent, you need to upskill.

    Thanks to technology, we live in a rapidly evolving world that demands we change with it. A copywriter is no longer just a writer; they now need to be experts in SEO, Google Adwords, CRMs, and so much more.

    A pastry chef needs to be a food stylist, photographer, and social media manager. An entrepreneur needs to be a marketer—or at least take ownership of the marketing message for their business—if they hope to scale.

    Technology makes all of this possible. No matter your location, your people can continuously expand their knowledge and gain new skill sets—something that’s highly motivating to employees. They want to know that there are opportunities to grow and develop themselves.

    If you won’t invest in your people, then your business becomes just another job to tide them over until they find where they truly belong. So be the company that sees value in developing its people.

    6. Monitor Their Workload

    Overworked employees tend to be unproductive and unhappy. Your people cannot be at full capacity every day, month to month. Something’s got to give. They’ll become deflated and their work will eventually suffer, which will negatively impact your business.

    What I like to do is implement a traffic light system. It helps me to keep a finger on the pulse of my business. So there’s red, yellow, and green:

    • Red means they’re fully loaded.
    • Yellow means they’re busy, but they can potentially take on more.
    • Green means they haven’t got enough to do.

    I use this traffic light system because I don’t want my team members to be stressed out of their brains all the time. If they are, they won’t make good decisions and they won’t do good work.

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    If my people are regularly overloaded, I have things to think about. Perhaps I need to hire a new person to help ease the load or take a closer look at what projects are good to go, and which can take a back seat.

    And this is why #3 is essential. If I’m regularly engaging with my people, I’ll know that while they’re coping with their workload, it is impacting their performance and health, and I’ll take action.

    7. Don’t Mess Around with Your Employees’ Pay

    Never mess around with your people’s salary. As a business owner or high-level manager, it’s easy to forget that most people live from paycheck to paycheck. Delayed compensation can mean a missed bill payment, which could result in costly penalties they can’t afford or hits to their credit score.

    So it’s your job to ensure that you pay your people on time.

    The Bottom Line

    A motivated team is an asset to any business. These people never give up. They get excited about coming to work each day and can’t wait to test a new theory or tackle a particularly tricky challenge. They’re proud of the work they do. And more importantly, they have no reason to leave.

    Wouldn’t you rather be part of their success story than the business that drove them away?

    More to Motivate Your Team

    Featured photo credit: Emma Dau via unsplash.com

    Reference

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