The U.S. Small Business Administration (SBA) estimates there are as many as three million small businesses in New York. They make up 99.8 percent of all the businesses in the state and employ about half of the people working there.
Starting a small business is a dream come true for some but also a considerable challenge. There is a right and a wrong way to go about it. Business experts like John Savignano can offer critical advice for those just getting started. Consider some tips from this industry expert for starting your business in 2022 and beyond.
Set Up a Forward-Looking Business Plan
Many potential business owners understand the concept of a business plan. However, Savignano suggests that they take it a few steps further. Create a plan that goes beyond just general revenue and action and focuses more on getting started.
Develop a plan that moves your business into the future while being adaptable enough to respond to current realities quickly. After outlining the company’s framework with an eye toward expansion, entrepreneurs should vet the business plan through market research, product testing, and other methods of generating helpful feedback.
Keep in mind the potential setbacks as part of developing the plan. For instance, what compliance issues might the business deal with and how taxes factor into the start-up.
Narrow the Focus
“In your 30s, you should start focusing on what you like to do and getting better at it, and do not contemplate making any serious money until you’re in your late 30s or 40s,” Savignano says. “I find that that formula usually works, and if you build up your skills and learn from making mistakes … and if you repeat it enough, you’ll get good at it, but you have to focus.”
Big companies have the revenue stream to push their brand in many directions. Small businesses do better narrowing their focus. For example, someone considering opening a boutique might focus on dresses or accessories instead of selling many items. The goal is to perfect one piece of the business at a time before expanding.
Make Buying Easier for Consumers
The easier the process is for potential buyers, the more likely they will become customers. For small business owners with brick-and-mortar companies, that means making the checkout process as simple as possible.
For e-commerce companies, it could mean avoiding the endless online forms and unnecessary checkout steps. Online businesses need to keep their websites eye-catching and easy to navigate.
Make Networking a Priority
“I always like to interact with people, whether it be socially or creating business opportunities or different ideas, but I’ve been doing this since I graduated college.” John Savignano points out the importance of networking even before opening a new business.
Business owners must build a large network of contacts and partnerships to build effective teams, generate sales leads, and establish productive industry relationships. It is critical to start this process well before the initial business launch.
Create an Email List for Consumers
It might seem like email lists are a bit old-school, but they offer an effective and inexpensive marketing tool. Emails are a personal touch for small businesses looking to build customer relationships.
They also serve a useful purpose. By asking consumers to sign up for an email list, a business owner knows they want access to deals and new products or services. They also provide the company with a more private way to touch base with their audience and target them for key specials. Social media is about making a public connection that helps to promote the business. Emails are a more direct line to the consumer.
Take Advantage of Automation
Opening a small business is challenging and time-consuming. However, brands that automate certain functions open up time for other things. That is why companies must leverage the latest in digital technology and automation.
This technology automates repetitive business activities and processes across market sectors and industries. Allowing computers to handle the mind-numbing, repetitive tasks small businesses do daily gives the owners and employees time to focus on the things that make the company work, like customer service and marketing. Today’s digital automation tools can generate and send AI marketing emails and track billing, profits, and expenses.
Do Away With Distractions
Distractions abound in the modern business environment, whether it is remote home services or in a professional office space. Rather than allowing a constant stream of text alerts, family intrusions, and other factors to disrupt workflow, develop guidelines and methods to reduce, if not eliminate, them.
After all, the financial consequences of constant distractions can devastate a new business still finding its feet. However, this does not preclude starting a business in spare time while working a full-time job, according to John Savignano.
“I would basically tell them to create what you refer to as a side hustle — I like that terminology… Because if you’re locked in a day job, if that’s what you like, it pretty much limits you in terms of what you can do,” says John Savignano. “But if you can step out of the box and take control of your life, it makes it No. 1, a bit more interesting, and gives you more opportunities.”
The first step of running any small business is to know what is involved. For example, what does the labor market look like, and what taxes are due? Also, entrepreneurs need to consider whether to work as a sole proprietor or incorporate and fully understand what each means.
Once a new business owner maps out the basics, it is time to get to work. Starting a business is a complex and costly venture. Taking steps to do it right even before the doors open will improve the company’s chances of success, especially in great cities such as New York.
As an experienced financial services executive in New York, John Savignano has worked for some of the world’s top firms and teaches at Fordham University School of Business.