How to manage your own business effectively

Photo: Opportunity Group

Any business, be it small-scale, micro business, large-scale or an online business cannot be run without proper management of time, human resources, finance /money, updated technology, new and creative ideas, and co-operation among everything mentioned. The ideas, planning, directing, controlling, etc. might be perfect and give you a picture of achieving great results by optimum utilization of resources involved, however, if the employees are unhappy and not satisfied inside the organization, the implementation of those planned ideas can go in the opposite direction as well.

Become a powerful leader with our management tips—people management, time management, money management.

How Do You Manage a Business?

Take care of your mental health

It might seem like a strange place to start when talking about how to manage a business effectively, but it’s the foundation of starting a small business. Starting and managing a business can take a toll on business owners’ mental health. It’s important that entrepreneurs take care of themselves through the process. Reserve time to decompress. Whether it’s meditation or yoga or simply going for a walk and listening to a podcast, taking “time off” is an incredibly important part of managing your own business effectively.

The other key is to try to adopt some level of flexibility. Your business may not turn out exactly the way you envisioned. Give your business room to pivot and adapt to whatever trends you’re seeing in the market.

Find the right setup

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While there’s a lot that comes with managing a business, it’s important to start with the basics. A clear vision or business purpose will help you get started and define a clear path for your entrepreneurial journey. Do some market research. Make sure your small business can meet a need in the market and that there is significant demand for your product or service. Once you’ve established the need, you can incorporate or set up a separate business LLC. The key here is to make sure that your business is a separate taxable entity — even if you’re the only employee.

Separating your business from your personal assets is more of a safety net than anything. This way, your personal assets will be protected should your business run into financial or legal issues.

How to Manage Accounting

Separate Your Personal & Business Finances

Don’t accept payment in your personal business account or put business expenses on your personal credit card.

Most banks will require official business paperwork to open something up in your business’s name, but at the very least, you can open separate personal accounts that are designated for only business transactions. Regardless, even if getting your LLC paperwork was a breeze, this is something you have to do.

Since you and your business are separate taxable entities, you need to have separate finances. Otherwise, things just get messy and you might as well assume you’ll have to deal with an audit—even if you’ve got nothing to hide.

Photo: startupguys.net

Hire a professional accountant

Another practice that will make your life a lot easier come tax time is working with a bookkeeper. While this isn’t always an expense that small business owners can afford, it will give entrepreneurs peace of mind that their finances are being managed correctly. A bookkeeper can help business owners manage money in a small business and manage taxes and payroll.

Technology

If you can’t swing the costs of a bookkeeper, try your hand at doing your own bookkeeping. There are many accounting apps that can help business owners manage expenses and keep finances in check. Some popular software programs to consider are Freshbooks, Quickbooks, Wave, or Square...

Pay the taxman

Another key to managing to account for a business is to always pay your taxes. Be aware of your tax payment schedule and how much you’re likely to owe. Unexpected tax payments can cause financial ruin for a small business. It’s incredibly important to always manage cash flow and know when (and how much) you’re expected to pay.

How to Manage Employees

Hire smart

Most business owners know that their employees are their strongest asset and that hiring those with differing perspectives will increase the likelihood of success. A key component to managing employees in a small business is to hire slow but fire fast. Take your time in the interview process and truly figure out who will help push your business forward. The same does not apply to letting employees go. If you think you’ve made a hiring mistake, act quickly to rectify it. An employee with a negative attitude or poor work ethic can sink a small business fast.

Train employees well

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When you do find the right hire, make sure you take the time to train them well — and then back off. Give them the skills they need to succeed in their role and the information to make wise business decisions. You can still be there to lend an ear or a helping hand. It’s also important to lead by example when training your employees. Create a culture you’re proud of and make your business a place people want to work. It’ll help you attract top talent without the deep pockets of some of the bigger players. Show new hires that their mental health is important and that you value work-life balance.

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