Tag: entrepreneurship tips

What factors go into small business financing?

“Where do I get the money to start or grow my business?” is perhaps the most common question entrepreneurs ask.

Of course, this question assumes that they know how much money they need to start their business in the first place. Most new and even some experienced entrepreneurs believe that if they have enough money, they can make any business model into a successful business. Sadly, there is nothing further from the truth. A bad idea is a bad idea no matter how much money you throw at it.

The reality is sufficient start-up capital is only one element of a successful new business. Research shows that the small business owner’s reputation and depth of their social network are important to securing financial help. Not all businesses need start-up capital – but for most, the need for money comes at some point in their business’ life.

How to determine how much business financing you need

Several factors influence the type, cost and suitability of financing for your business, including:

  • Stage of the venture process – Start-up? Growth? Maturity?
  • Achievements and financial performance to date
  • The state of the industry your business is in
  • The type of technology your business is based on (if any)
  • Potential growth of your venture
  • Number of years before an exit strategy is available for investors
  • Investor’s required rate of return on their money
  • Amount of money you need
  • What your company is worth
  • Your goals for your company
  • Investor’s terms and conditions

These are just a few – many other factors come into play when it comes to choosing the most appropriate sources of funding for your business.

At GoForth Institute, we believe entrepreneurs should really be asking, “What is the best kind of funding for my business?” There’s no one-size-fits-all solution when it comes to getting funding for your small business. There are many sources, varying amounts, and of course you must ensure the funding you have your eye on is actually suitable for your small business.

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How to make managerial decisions as an entrepreneur

As the owner of your small business, you’re in charge. This means you’ll have to make tough decisions from time to time. If you’re not used to doing that, don’t fret! It can be learned.

How to make good decisions as an entrepreneur

When making decisions, keep these things in mind:

  • Have a clear understanding of the decision to be made
  • Consider the vision and values of the company
  • Evaluate the consequences and outcomes of your decision
  • Brainstorm as many alternatives as possible
  • Evaluate the pros and cons of each alternative
  • Be sure the appropriate person is making the decision
  • Understand the timeline in which the decision must be made

How to tell if you’ve made the right decision as an entrepreneur

Once you’ve made your decision, re-examine it and the effect it’s had. Don’t rely on expert information too much, but ask others for their opinions when necessary. Be realistic when evaluating alternatives and try to avoid hearing only what you want to hear. Remember the importance of the decision, but don’t focus so much on it that you get too stressed to make an effective assessment.

Practice making managerial decisions with friends, family and other colleagues. Don’t forget – “my way or the highway” is not effective managerial decision-making for a small business. Learn to evaluate, solicit opinions, contemplate, make decisions and follow up.

You can do this!

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How much should you pay yourself as an entrerpreneur?

When starting a small business, many entrepreneurs wonder: How much should they pay themselves? It’s a valid question – for the first time, you may be receiving a salary that wasn’t set by someone else. It can be hard to know how much to pay yourself as an small business owner.

Thankfully, our GoForth Expert Norman Leach has the answer. He goes over the main considerations that go into setting your own salary, so we think it’s a great starting point. Check out his advice about entrepreneur salary here!

 

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Tips for delivering a great customer experience

Customer experience measurement is the practice of measuring customer experience – which includes all customer actions – at all “touchpoints” throughout the customer journey.

What is a touchpoint in customer experience?

A touchpoint is any interaction a customer has with your business: a phone call, a website visit, an email, a shipment – any time a customer “touches” your business. The only way we can get a better understanding of customers and their needs is by measuring the customer experience. Not only does measuring customer experience enable you to cater to customers’ expectations, it also lets you measure how effective your customer experience strategy is.

How to measure the customer experience (CX)

Designing a great customer experience is only the first part — you must actually deliver on that experience, and then measure your CX satisfaction to make sure you’re delivering a great CX for your customers.

Highlight all touchpoints

Study your customer’s journey from beginning to end, and sketch the whole customer experience according to the customer’s point of view. Select the touchpoints that are defining moments for the customer, and establish metrics for every touchpoint, or metrics that specifically evaluate each touchpoint’s performance.

Understand your customer

When you understand your customers, you can think like them, and can offer products and services to better engage them and provide excellent experiences. It’s important to know their greatest needs and expectations — what makes them happy and what you should continue doing to retain them. Draw a map by creating a timeline of the customer’s journey and defining what is essential at each touchpoint along the journey.

Solve the key problem areas

Once you’ve identified all the touchpoints, highlight the key areas of concern and start working on them systematically. Identify and highlight each problem, and come up with solutions that will specifically address these problems.

Select the right metrics

When you have all the important touchpoints and have found solutions to key problem areas, you’re ready to start measuring the results of your efforts. To do this effectively you need to choose the right business metrics to analyze. Here are a few common customer experience metrics you can use:

  • Net Promoter Score (NPS): The NPS is an index that ranges from -100 to 100 that indicates how willing a customer is to recommend a company’s products or services to others. It divides customers into three categories: Promoters (loyal + satisfied), Passives (satisfied + unenthusiastic), and Detractors (unsatisfied + unenthusiastic). First Contact Resolution
  • (FCR): FCR gives an indication of how well you resolve customers’ support requests the first time by tracking the number of interactions in a case. Tracking your FCRs helps you see what you can do to keep the average number of interactions low.
  • Customer Satisfaction Score (CSAT): CSAT is the average score awarded to your brand according to customer answers on a survey. Small businesses use CSAT scores to determine how satisfied customers were with specific products or services.
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