The 5 things you need to be concerned for establishing profitable business
How do you build a profitable business? Do you attend more seminars to gain information? Can you guarantee your idea will work? What aspect “execution” means?
It seems easy to have own business. You can have any idea based on passion, opportunity or just starting your online store. But there are some pivotal factors that make your business sustain. Businesses have complex aspect including promotion, system, monthly report, gaining data until gaining reveneu. However,
1. Human Resources
this is probably the most contributor aspect to make your business profitable. When we have a right person to handle and contribute in their field, it could increase probability to success to 99%. our duty is finding the person who fit with our company.
Here are 5 Practical Things You Can Do to hire right person
- Skill Requirment checklist
- Create recruitment campaign and pay advertisement to obtain more engagement. The more people register, the more chance you get the right person
- Shorlist the candidate and held interview
- Find person who suit with your personality
- Pay them properly and give them a comfortable workplace
The owner mindset should focus on the business development. You have to believe and trust with your new partner in business. They may quite new in company, but they have willingnes to learn something new.
2. Reporting System
Most of business lack of reporting system especially for small medium enterprise (SME). it makes the owner have poor data, effecting worst decision making. For example, sales data should be reported in daily report, weekly report until monthly. it gives the owner perspective which product have high sales and low sales. by using simple sales data, the owner can create right campaign and repurchasing the right product.
Do we need to buy or subscribe some product? it depends. i personally use microsoft excell or google sheet to have daily report about sales, business growth, partner until bonuses.
I give you an example of my fowarding business. Everyday my team send me a link to access google sheet about sales. In january 2021, we started to obtain 205 package each day and increased to average 300 in february 2021. it can be converted into monthly graph that give you important information of sales.
My fowarding business established 3 months ago and it can be seen significantly growth from 4 package/month to 3630 package/month. By a having a proper data, we can maintain our company in real time.
While the business start to generate net income, the owner should re-invest those money back to business. In some cases, owner prefer to buy personal stuff such as car, house or clothes. they assume that by buying some expensive stuff, they could attract more customer. But, in fact, they only feed their ego to show their success.
Now, We are looking at my fowarding business. Entering February 2021, we estimate that our sales incline to 6000 from 3630 because of new acquisition. those will affect our revenue and we have more capital to enlarge business. Hal apa yang harus kita prioritaskan?
We prefer to allocate our budget to something that increase sales. Some industry may have different aspect. But, in fowarding business, vehicle and human resources have biggest operational contribution to offer more services area. So, we decide to prior our investment to buy vehucle and hire more resourses.
4. Be Patient
i know some of us have ambition to expand business as soon as possible. We usually are influenced media that show young success founder of startup or business without seeing what founder did. it may encourage every young entrepreneur to work hard and spend more time in their business. Trust me, media only shows a few example of them, not more than 1% of total entrepreneur. Most of entrepreneur take some times to raise their business. Apple was estblished in April 1, 1976 and needed 34 years before Steve job introduced his masterpiece, iphone 4. Based on apple case, most of business usually need some times to grow.
Although, my fowarding business is experiencing sales growth, it needs 6–8 month to reach break event point (BEP). Based on my mentor, Some of business such as restourant or food industry achieve their BEP until 2 years. After gaining BEP, the business start to generate their revenue.
So, how long those business takes? it depends on industry and your sales projections. Our duty is to ensure the business run based on your business plan. Moreover, it depends how you can accelerate your business.
4 tips above will become theory forever if we not execute them. i know that it seem simple for reader here. You have try in small scale or we called lean process. The first process mean the owner identify the problem. The second step, the owner start to generate to overcome the problem. Chose the best solution for that problem. Afterward, you can start to implement new idea to improve your business or solve the problems. Review those strategies until you find the right solution for your business.
this process will help the business owner continuously improve their strategies. Every business have their own problems eventhough we have smart employee, great team, great sales projection, enough revenue. Lean process will reduce cost of executions by implementing small scale of solution. While it success, Some solutions may be adopted to other aspect.
I obtained those strategies while i discussed with successful entrepreneur. it means a lot for me that encourage me to work efficiently and smart.