I am very optimistic about the future of small business. The stock market is at a new high, unemployment at a new low and the recent tax cuts have large and some small businesses giving bonuses to their employees.
Technology appears to be on a growth spurt with new innovation coming at us from all directions. Construction is booming in many parts of our country and real estate values are almost back to the pre “recession” levels.
However, there is a certain amount of risk and as a small business owner you need to be aware of a few don’ts:
- Don’t increase your debt level by any more than you can comfortably handle with your current income. Growth, in most cases, requires a certain degree of risk, but not so much that it can put you out of business if a forecast does not turn out as predicted.
- Don’t neglect to set up a contingency reserve account to keep your business going. I recommend a minimum of a three month reserve, but prefer a six month reserve. This is a contingency reserve not an opportunity reserve.
- Don’t neglect to setup a personal retirement account.
- Don’t neglect to set up an action plan to achieve your goal for this year. This should be reviewed at least once a month and adjusted as needed.
- Don’t forget that change is the only constant in your business. Always be on the lookout on how to improve your products and services.
- Don’t slow down your business building efforts; in a good economy you have to work even harder to take advantage of the many opportunities.
Fast, uncontrolled growth also poses a risk; many small business owners have gone out of business by growing too fast without the necessary “growth structure” in place. This saying, “It’s good to be in business for yourself but not by yourself” is equally applicable in good times as in bad. Always consider having a mentor at your side to help you achieve your full potential.