Tips on managing a small business

Your small business is important; it is your dream that has become a reality. 63 percent of new businesses don't survive six years - and most work at home individuals fail within six months. In order to avoid becoming one of these statistics, follow the suggestions below on how you can successfully manage your small business:

Have a clear-cut strategy.
Your strategy immediately separates you from your competition and provides your customers with a clear view of what you are about and why they should buy from you. Your strategy should be based upon the market, customer needs, competition, and your company's strengths and weaknesses. Many small businesses think they can be everything to everyone. This in essence is just the same as not having a strategy at all.Find what specifically you can do, stick to it and do it well.

Create and test your advertising.
Finding a strategy that is consist and provides good results is not an easy task. Try out several methods, test the results.Don't spend lots of money on one avenue only. Find a mix that really provides the best results for your business. You want your advertising to lead your customers to action. Sometimes the smallest "cheap tricks" can be successful.

Don't be afraid to try.
Have a good plan and follow it. Develop your business plan and revisit it at least once a year.See what has been successful and keep to it. Include in your plans your budget.Make sure that you are adhering to that so you don't end up in over your head. A plan and budget help you to have a direction. It helps provide warnings if your company is heading in the wrong direction, allowing for quick reaction to return to the proper direction.

Manage your cash flow.
You want to guard your cash as much as possible. Most companies end up losing the battle because of poor cash management.Overrunning startup costs, lower than anticipated profit margins, slow growing sales are the usual suspects when it comes to business failures. Be disciplined in controlling your cash.Budget carefully and hold on to your money as much as you can.

Watch your profit margins.
Most small businesses think sales and profits are the same thing. While sales lead to profits your profit margin is what determines the greatest part of your success. Anytime you can lower your costs without raising prices you increase profit margins. You can raise prices as well, but this can lead to lower sales. These two things work together. It's a tricky balancing act that you continually have to be on top of.
Treat people right, but don't give away the store. You need to make sure that you treat your employees and your customers with a great level of respect. At the same time, don't allow them to walk all over you and take the whole store for free. People will try to get as much for free as they possibly can. Be responsive and attentive to the needs of your employees and customers, but make sure that you have good policies in place to protect yourself from handing over your business.

Have Fun!
If you are having fun working your business your employees will as well.This helps translate into a fun environment for customers and a more successful business.If you enjoy what you do the more chances you have of remaining in business.No one wants to be in a place that is negative and gloomy.Your turnover and training needs will decrease as well.

If you follow the suggestions provided here you are more likely to have a successful small business.