Important questions to ask yourself After you have started your venture.
Your plan is ready to be in action. A part of your venture is already established. Throughout this journey, you had to make the decision whether you wanted to start a venture or not. But now when your venture has started, you will be faced with various decisions which will actually affect the profitability of your business. They can go on from the stationary you use in your office to the financing for your venture. The small decisions take up a lot of space in your mind and even trouble you if not taken care of properly. Here are a few decisions that are extremely essential to make while running a business:
Structure of the business: now that you have started your business, make sure you know what is the structure of your organisation. Is it a sole proprietorship, general partnership or limited liability corporation. All these business structures have your own implications in terms of liability, profit and cost-sharing. They also have a huge impact on taxation. Sometimes certain businesses move from sole proprietorship to partnership, this move takes various changes and one must be familiar with that. The gist of this point is to know how your organisation will work and who is the boss of your organisation.
Financial decision: you need to know from where you are raising the funds. Are you using your own savings or are you borrowing money from someone? For startups, decisions about how to fund the business are the most important decisions of all time. Cash flow is equally important for a business. Acquiring assets and making sure that the liabilities are in check is also very important. These decisions are so important that at times startup hire accountants and auditors that can help them with this matter. Always remember that even if you are funded by someone else, you need to multiply that money and return it back. You need to make the most of your funding. And if you are using your own savings, make sure that at the end of the day you are not at a big zero.
Manpower requirement: human resources are the most essential components of any venture. You do not have to invest heavily in human resource right now. You need to work for yourself and make the ends meet. Till the time of solid revenue model is not attained practically, you cannot hire people and pay them lakhs. Hire interns, hire contractual employees who work more and give standard results. Remember that you need to work as if you do not have any cash. Use cash as wisely as possible.
Business strategy: these are other plans that are created for long-term impact. They are made to achieve a profitable position. These are the decisions about developing a new product or a new service line, about your branding, about packaging etc. You might want to get into joint ventures, merge with other organisations, start a new business, all these come under the business strategy. Know your strategies before time and keep on improving them according to the changing environment. The key to a successful business is to know what is going on in the market at the right time.
Investing decision: this decision is one of the most important decisions of an organisation. A company’s assets are very important and they must be put to the right use. A form should pick wisely wherever they want to put their part and from where the highest returns will come. Profitable investments lead to growth and generation of revenue. This is what the business needs right now. Excessive calculations are required for interest rates, cash flows and the rate of returns.
Dividend decision: in case you have shareholders in your company, know when you want to give them the dividend and when you want to retain it. There are times when the company does not have enough funding available for its next big step and they need to retain the profits of the shareholders for better prospects of the future. Know when you want to take this decision and communicate it properly to the investors and the shareholders.
These are some of the major decisions people have to take after they have established a new business. Business owners have to take all these decisions so that they can run their business in a profitable manner. These decisions are related to the operations, investment, finances etc. The owner of the business is the sole manager of the entity and he is always faced with a thousand decisions to make and it is important to divide these decisions wisely into categories: important ones and the small decisions.
