TIPS IN RUNNING A SUCCESSFUL BUSINESS PART A

Most people come up with a business idea at some stage of their lives. Some people have the courage to act on that idea and set up their own business. Few people have the smarts to make their business a success.

Unfortunately, most people will need help and advice if they are to set up and maintain a long term, profitable business venture. This is where we come in to help.
Our top tips below will provide you with a framework to running a business that works.
Don't get carried away by one successful year

One year's profitability is no indication of future years, so don't get excited and spend all your profits on a new fleet of BMWs or buying corporate boxes at your favourite sporting events. Maintain effective cost controls.

Avoid and manage bad debts
Bad debts are a common cause of failure. Avoiding bad debts takes skill and experience. Research your customers, be swift to chase debtors, ensure invoices are sent out on time and be clear about payment times. Consider charging interest in terms and conditions.
In terms of managing bad debts do not accept flimsy excuses and if payment is promised make sure you call back to chase up. If your customer is experiencing cashflow problems suggest a payment plan. Better to get something than nothing.
* Looking to improve your cashflow? Consider invoice financing

"Don't stop moving"
The similarity between sharks and businesses is that both need to keep moving in order to stay alive. Standing still in business is not an option today. Develop a strategic plan of where you want the business to be in 3 – 5 years. If a business is not growing organically or by acquisition it will not survive for very long.
Don't be afraid to sack poor managers
It sounds harsh but poor management or 'non-participating owners of SMEs' is the most common reason for failure cited by fellow corporate recovery professionals. Not all directors follow IOD guidelines or have any qualifications to run a business so get a second opinion if you feel your business is at risk. Often managers will not face up to or be unaware that a problem exists and that it steps towards positive action are required. Remember that when businesses are trading at a loss, taking quick action is critical.
Don't attempt a turnaround without seeking professional advice
Whilst you may have the urge to re-mortgage the house or use your personal credit cards to pay off suppliers don't do it without speaking to a corporate recovery professional. Business failures are a fact of life and once losses start they can be unavoidable. Often businesses can be restarted or assets purchased from an Administrator, Administrative Receiver or Liquidator. So keep your money in your pocket until you have taken professional advice.