14 Steps to Running a Thriving Business as an Entrepreneur
Everyone wants to know how to run a business and succeed, outrageously. Whatever radical success means to you, this comprehensive guide gives you proven tips for how to run a small business that is designed especially for entrepreneurs (like a lot of Ninety’s users).
How do entrepreneurs run their businesses?
“Entrepreneurship” is defined as the ability to start and run a company using big ideas and limited resources. Entrepreneur means “adventurer,” from the French word, entreprendre.
The entrepreneur is responsible for all of the risks associated with bringing a new product to market or introducing a novel idea that often defies any existing enterprise model. The entrepreneur also reaps the rewards if their company is a success. Think Henry Ford, Steve Jobs, and Oprah Winfrey.
People credit the French scholar Jean-Baptiste Say with coining the word, entrepreneur. Say was also an economist who believed entrepreneurs like himself, “seek out inefficient uses of resources and capital” to “create new markets and opportunities” for trade.
“By constantly disrupting the balance of competition, entrepreneurs prevent monopolies from forming and create a wide diversity of products that keep consumers consuming and producers producing,” according to Investopedia.
Because entrepreneurs focus on the wisdom of uncertainty, they value the kind of dramatic growth and high returns that can greatly affect economies and influence other elements of a thriving enterprise environment, like creating more value, more demand, and more jobs.
Entrepreneurs find new strategies for how to run a business, and continuously lead:
- With singular passion
- With enough confidence to assume great risk
- With unique ideas that can be transformed into marketable ventures
- By planning for unknown risks
- By nurturing their sense of potential in a new concept
- By capitalizing on an idea, product, or service to enable fast growth
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“It’s really exciting to realize I can achieve anything that I want to, with the help of Ninety. It’s a pathway for great achievement.”
-Chris Breen, DeckMasters
Looking to find out how to run a successful small business?
Here are a few quick tips:
- Realize there’s no such thing as instant success.
- Making your company successful takes continuous hard work.
- You have to research your industry, study the market and learn about your ideal customer. Then know all three, inside and out.
To know how to run a small business, it’s often helpful to look at why companies close. It can give insight into what to focus on and what not to do for better results. Here are a few common reasons why companies fail.
The product or service is unnecessary or nonessential.
If you’re not meeting a demand in the market with your product or service, no one will buy it. This is where market research, industry know-how, and customer knowledge will help you discover how your goods fit into the bigger consumer picture.
The market is saturated.
If you’re facing too much competition from established companies, the job of differentiating yourself from the crowd is that much harder. You’d have to offer something out-of-this-world unusual.
Marketing is nonexistent.
A comprehensive marketing strategy is essential for generating leads. Your plan should dovetail with your sales efforts and utilize different promotion, advertising, and inbound marketing tactics that get the word out about your company and what you’re selling.
Bad customer service.
Once your company gets a reputation for treating customers poorly, you’ll always be playing catch-up in the marketplace. Just look at this recent list of the most hated companies in America.
Leadership is a cooperative action. It involves collaboration among company owners and everyone else working in the company. Build a strong team by recruiting and hiring smart people.
No plan for growth.
You can’t grow if you can’t scale up. If your company ever gets any unexpected free publicity – like a mention from a social media influencer or other news that goes viral – you’ll want to take advantage of the opportunity. You can’t do that if you haven’t planned for the added attention with the appropriate amount of staff.
You don’t know what you don’t know.
You haven’t networked with fellow owners who will share advice from their own experience, such as:
- Consider partnerships carefully. Consider how your skills and approach to work mesh, and how suited you are to run the company together day-to-day.
- Keep the endgame in mind, because the road is long. There will be days when the initial reason you started your own company will keep you going, whether it is being your own boss, quality of life, controlling your own time, making a difference, or something else. The inevitable sacrifices are only temporary.
- Hire people to help. Trying to do everything on your own will only burn you out. Most successful owners will tell you, “Don't let your task list undermine your big goals.”
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“Once we started using Ninety, it made it so much easier to track metrics and the communication just got way easier. Ninety just helps tie everything together nicely.”
-Jessie Capote, J&C Tropicals
What keeps a business successful?
Most successful companies nurture a continuous focus on these three things:
- Creating a great customer experience.
- Building a distinctive reputation for industry expertise through excellent goods and services.
- Cultivating trust in company leaders, team members, and customers.
With a healthy flow of energy from these three aspects of success, companies can:
- Understand their ideal customers’ needs better.
- Provide customers with solutions they won’t find anywhere else.
- Enable undeniable customer loyalty.
Looking to find proven ways how to run a successful business? These eight tips can help.
Over-deliver on the customer experience.
Recent reports predict that the impression companies leave with their customers will continue to be an important differentiator for success. Most companies (93%) realize that the customer experience (CX) influences people during every stage of the buyer’s journey and those prospects have higher expectations for the CX than ever before. Sixty-five percent of them say it's more influential than any type of advertising.
Stay aware of brand chatter.
People will talk about your company whether or not you’re listening. Make sure you hear (most of) it. Conduct surveys, use social listening and gather data from current customers on their views. Respond more often than not but stay true to your company’s core values and key objectives.
Never lose sight of leadership skills.
Owners need excellent, adaptable skills to be able to lead their companies to long-term success. Develop things like integrity, accountability, empathy, humility, vision, drive, and an unwavering desire to elevate your skillset as a leader.
Always exceed expectations.
When a company goes beyond what’s expected, people start to trust that the company really means business when solving their problems. Prospects become customers who are part of a loyal community that will not only support the company but happily promote its products and services to others.
Create an agile communication strategy.
Keep track of how to get the right message to the right audience at the right time. This means you study where your customers are, know their communication preferences, and use this information to share the message about your brand.
Increasingly, prospects are online and they prefer to engage with companies digitally, which means companies are utilizing search, social media, email, and content marketing as well as a company website and pay-per-click (PPC) advertising to attract and connect with customers. Successful companies have an omnichannel approach to marketing that creates one cohesive experience for the customer.
Refine selling into customer relationship management.
Customer Relationship Management (CRM) is any practice, technology, or strategy that helps companies improve customer relationships. CRM often involves instituting adaptable tools for running a company’s interactions with customers and prospects to stay connected with them, streamline the process, and improve sales.
Breaking down everyday tasks into workflow steps will improve productivity. Leaders will have more time to focus on growing the company.
Make the effort to venture out – from in front of the computer screen and behind the desk, into the business world at large. Engage in face-to-face communication with team members, attend industry events, host a webinar, be a guest speaker, start a podcast, and participate in other activities that keep you and your brand front and center.
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“Implementing Ninety has helped us delve into the functionality of Issues from team to team more easily. The smooth workflows and centralized spot to see Issues and To-Dos save time, especially if I want to pop into a Scorecard before one of our departmental meetings just to see everyone’s status.”
-Jessica Lord, Heine Brothers’ Coffee
How Businesses Are Running in America: By The Numbers
- There are 32.5 million small businesses in America. These small businesses account for 99.9% of all U.S. businesses.
- Small businesses create 1.5 million jobs annually and account for 64% of new jobs created in the U.S.
- Almost 80% of new small businesses make it through the first year. About 50% survive the first five years. 70% of small businesses close after 10 years.
- Each month, about 543,000 new companies are founded.
- In 2021, 58% of small business owners started a new, independent company from scratch; 18% purchased an already-existing company.
- Whether new or established, one in every 12 American companies close each year.
- Over the last 45 years, the small business closure rate declined by 30%
- 52% of the people who responded to a recent CNBC survey say the most important problem for small businesses is the quality of the available labor force.
- Other top challenges of running a company include:
o mitigating the impact of the coronavirus (29%)
o attracting customers (13%)
o financial stability (12%)
o technological advances (5%)
o taxes (5%)
- 86% of companies invest in technology to improve productivity. More than a quarter of companies use business-planning tools to make sure productivity continues to stay robust.
- In 2016, Millennials became the largest generation of the American workforce. By 2025, Millennials will make up 75% of the global workforce. Millennials are already running 16% of small businesses in the U.S.
- According to a survey by Bentley University, 77% of Millennials say that flexible work hours make them more productive.
- 32% of small business owners are women, a 13% increase in 2021, and 68% are men.
- 90 million small businesses use Facebook pages to promote their brands, products, or services.
- Eight years ago, 94% of small companies were already using smartphones to conduct business. Now, running a business without smart devices is inconceivable for them.
- In 2020, 51% of small business owners increased the number of online interactions they had with their customers.
- In 2022, small business owners are planning for improvements:
o 49% plan to increase staff and expand or remodel their company
o 55% plan to pivot to digital marketing and 30% plan to stay with traditional marketing
o 27% plan to upgrade their IT infrastructure
o 22% plan to invest in business operating system software and other services to help them run payroll, accounting, or inventory
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“Using Ninety has made a huge difference in our business. It's a fantastic tool that helped us change our entire company substantially.”
-Jonathan Krellwitz, K2 Financial Partners
Grow Your Small to Midsize Business Without Losing Your Mind
Here are 14 ways to succeed as an entrepreneur in our Work From Anywhere World™.
1. Figure out your “why.”
Most people want to do meaningful work, like business leader, writer, and executive-team coach Mark Abbott. He’s passionate about self-actualization through work and sustaining organizational well-being.
He says, “I believe that most organizations could do the ‘people stuff’ so much better than they do for a host of reasons, not the least of which are weak people systems and some serious misconceptions about why people really work, how to motivate, and what strong leadership is all about.”
His words help to define his “why” for founding Ninety.io.
2. Know your key performance indicators.
To clearly define how you’ll measure performance, you need to conduct comprehensive market research:
- Get up-to-date knowledge on market trends.
- Identify your competition.
- Gather data on your ideal customers.
- Calculate demand and potential growth.
- Be clear on the eight P’s, which are product, price, place, promotion, people, process, physical evidence, and performance.
From this information, you can form the specific key performance indicators (KPIs) that will help measure your company’s long-term performance.
3. Write a business strategy.
Your strategy for conducting business can include a document called a business plan where you write down the way the company will:
- Compete in the marketplace.
- Envision high-quality, imaginative products and services that benefit customers.
- Conduct goal-setting, planning, and taking the right action.
- Create value for everyone.
- Make a mark on the industry.
Make sure to revisit your business strategy annually.
4. Give your business a (good) name.
It’s not enough to choose something you like.
- Brainstorm a few names and test them with prospective partners, investors, company leaders, team members, and customers.
- Do a thorough search of registered names, trademarks, domain names, etc. before deciding on your name.
- Make sure you’ll be happy with the name as your company grows.
- Make your name internet-ready by immediately registering a domain name (or a few).
5. Structure your business.
Decide what kind of company you’re creating. The legal business structure determines how to file taxes and liability, personal or otherwise. Here are some options:
- Sole proprietorship – You own the company by yourself, with responsibility for all debts and other obligations. This is the least effective option for protecting personal liability and directly affects personal credit.
- Partnership –The company is owned by two or more people who are both liable for all debts and other obligations.
- Corporation – Here, you can separate company liability from personal liability by forming an S, C, or B Corporation. This makes the company a separate entity from the owners, responsible for all corporation debts and obligations, including owning property, paying taxes, entering contracts, or lawsuits on its own.
- Limited liability company (LLC) – LLCs have the legal protections of a corporation and the tax benefits of a partnership.
6. Register your company.
Registering your company with the government enables it to be recognized as a business entity. Corporations need an “articles of incorporation” document, some LLCs need to create an operating agreement, and others need to register a business name. If you are a sole proprietor, the business name can be your legal name or a fictitious Doing Business As (DBA) name for your company. For additional legal protection, trademark your business name.
Obtain an employer identification number (EIN) from the United States Internal Revenue Service (IRS) if you plan to employ others. An EIN also helps separate personal and company taxes. Some states require a state tax ID. With regard to taxes, different business structures require different forms for both state and federal tax fulfillment.
7. Get the proper federal, state, and local licenses and permits.
Contact your local city hall to get the appropriate permits to operate in your region as well as the required federal, state, or local licenses. The Small Business Administration is also a great resource for better understanding how to run a small business.
8. Protect intellectual property.
Intellectual property (IP) is valuable to your company’s welfare and its future. This includes patents and non-patent intellectual property such as trade secrets, cybersecurity policies, trademarks, and copyrights. IP protections include:
- Patent – gives the inventor the right to prevent others from making, using, or selling the patented subject matter described in the patent’s claims.
- Copyright – gives the owner the exclusive right to make copies of original works of authorship like art, advertising copy, books, articles, music, movies, software, etc., and to make derivatives based on the work like revisions or sequels.
- Trademark – marks registered with the U.S. Patent and Trademark Office protect the symbolic value of a word, name, symbol, or device used to distinguish a good or service.
- Service Mark – used to identify services, similar to a trademark.
- Trade Secret – A trade secret is an asset as long as it maintains its confidential status and derives value through its secrecy. Owners can take action against anyone who breaches a confidential agreement or obtains the secret by stealing or other improper means.
- Confidentiality Agreement – Also called Non-Disclosure Agreements (NDAs), they obligate a third party to keep shared confidential information private unless allowed by the owner of the information.
9. Hire a lawyer.
Having an experienced business attorney on your team can help you:
- Legalize business structure and register the business
- Limit potential legal liabilities
- Draw up contracts and key agreements
- Set up a stock option plan for employees
- Prepare protective human resources documents
- Help negotiate terms with prospective investors
- Protect intellectual property
10. Buy insurance for your company.
Protect your company with insurance that’s based on the business risks. Here’s a list of the kind of coverage that may be appropriate for your business:
- General liability insurance
- Product liability insurance
- Professional liability insurance
- Property insurance
- Worker’s compensation insurance
- D&O (directors & officers) insurance
- Health insurance for employees
- Business interruption insurance
- Commercial auto insurance
- Data breach/cybersecurity insurance
- Keyman life insurance
11. Do a break-even analysis.
Every entrepreneur needs to access financial well-being. A break-even analysis will help you determine what you need to run the business without losing value. Here’s the formula:
Fixed Costs ÷ (Average Price - Variable Costs) = Break-Even Point
Next, entrepreneurs want to know what they need to create value. This involves calculating what you need to cover all expenses, pricing products and services properly, determining fixed rates, variable costs and total costs, and what’s left over.
12. Look into funding.
Companies can consider a variety of options for financial assistance:
- Business loans – Commercial loans and SBA small business loans are available.
- Business grants – Grants fund ideas and projects to stimulate the economy, provide public services, and benefit unique circumstances. Options include minority-owned business grants, grants for women-owned businesses, and government grants.
- Investors – People who can provide significant amounts of support up front, with the expectations of taking an equally significant role in running the company.
- Crowdfunding – Raising smaller amounts from multiple backers.
13. Build a relationship with a business bank.
Experts often recommend that smaller companies consider community banks that understand local market conditions and place an emphasis on character as well as an overall business profile. Determine what you need from a banking relationship. Meet with several banks of different sizes and ask how each works with small companies over the life of the business.
14. Learn how to read financial statements and work a budget.
Understanding financial statements will help you answer investor questions. Working with a detailed budget helps you avoid running out of cash.
To have all the necessary information at your fingertips, it’s important to maintain the appropriate records for your company. They include:
- Financial statements (P&L, balance sheet, cash flow)
- Bank accounts
- Creditor records
- Tax filings and records (federal, state, and local income, sale