Journey of a Serial Entrepreneur

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How to get from where you are to where you want to be

10 Lessons from a Year of Blogging

“There are no mistakes or failures, only lessons.” Denis Waitley

I made a resolution on the 31st of Dec 2007 to blog every day for an entire year. Not quite knowing what I was getting myself into I started writing and have not looked back since. Through the course of the year I realized that the goal I had set for myself was very challenging and required a lot more time and effort than I had expected. Nonetheless, I thoroughly enjoyed writing on a daily basis and aim to continue blogging through 2009. Next year I do not plan to blog everyday but have added some new twists along the way to help differentiate my blog from others in my niche. Listed below are 10 lessons that I have learnt after a year of blogging. If I had read these lessons prior to starting my blogging journey I would have been more prepared for what was in store for me. I hope these lessons will help new blog writers on their journey.

Lesson #1 – Selecting a Niche: Before one starts to blog, clearly identify the target market that you want to serve. This will provide definition and boundaries for your blog and help you to be more focused and become an authority figure in that particular niche. To learn more and access some helpful links on selecting a niche please click here.

Lesson #2 – Passion: The niche that is selected must be something one is truly passionate about. If you just begin writing about something that seems to be the buzz these days, it is most likely that motivation levels will fall drastically over a short period of time. To learn more about passion and selection of your blog niche please click here.

Lesson #3 – Have a Goal: This helps put things in perspective as well giving you achievable targets. Some metrics to track progress by are, number of posts, number of blog hits, number of comments etc. Set specific goals that can be measured and tracked. By doing this simple goal setting exercise , you have a far greater chance of success. To learn more about goal setting for your blog please click here.

Lesson #4 – Commitment: If you are planning on starting your blog next year, I suggest you give serious time and thought  to evaluate how much time you can actually spare in your day to blog. How long does it take you on average to write a blog post ? What other factors will help your commitment when you do start? Lastly, make an open commitment to the blogsphere about your aspirations and goals for the year of 2009. To learn more about commitments and blogs please click here.

Lesson #5 – Providing Value: I use the NABC formula to develop most of my value propositions. It simply helps you identify the Need, Approach, Benefit and Competition. Based on these core principles you can come up with a proposition that will help generate considerable value for your target segment. To learn about this formula in greater detail and how to apply it to your blog please click here.

Lesson #6 – Importance of Reading: If you plan to write a new blog in 2009 then reading is something I highly recommend integrating into your daily schedule. This will not only increase your knowledge base it will also help you get a better command over how to write as well. One needs to be constantly aware about the changes taking place in one’s niche and what authority figures are talking about. To learn more about my daily reading schedule please click here.

Lesson #7 – Dealing with Writers Block: Writing on a regular basis is a challenging feat. One which is bound to frustrate and irritate you at times,  it is also one of the most satisfying and rewarding things to be able to integrate into one’s life. Dealing with writers block is a part of being a writer. Some of the things I use to deal with it are taking short walks, doing a brain dump exercise or even using mind maps. To learn more about the strategies I use along with some helpful links please click here.

Lesson #8 – Patience: Developing a readership and increasing your daily traffic takes a lot of hard work. Expecting to make 6 figures a year from part time blogging is wishful thinking. One needs to focus on developing great content and using it to drive traffic to your blog. The beauty of the internet is its ability for the rapid exponential growth of your blog. A blog that is growing at a monthly pace of 10% will see traffic increase steadily through the course of the year and eventually those numbers will begin to multiply. To learn more about patience and blogging please click here.

Lesson #9 – Networking: A lesson I learnt late in my blogging journey was networking effectively through the blogsphere. If I were to start a new blog in 2009 I would spend more time building a comprehensive blogroll, concentrating on cross linking from high traffic blogs, commenting regularly and using social media to develop strong relationships with authority figures in my niche. To learn more about these techniques please click here.

Lesson #10 – Having Fun: This is an essential factor if one is wanting to blog on a regular basis. If one does not enjoy writing or reading, blogging on a regular basis is going to be more of a chore rather than something to look forward to. Pick a niche that excites you and half the battle is won. For the other half I recommend you should just write,  slowly and over time the content of your blog will become better and eventually blogging will become a lot of fun. To learn more about having fun while blogging please click here.

I hope these lessons will be of some help to first time bloggers. If you have been blogging for some time and have learnt or experienced some other lessons please share them so that we can build a repository to help first time bloggers. I wish you all the very best of success in future blogging ventures.

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Lesson #10: Having Fun

“People rarely succeed unless they have fun in what they are doing.” Dale Carnegie

Blogging on a regular basis is hard work. I am pretty sure most of us who blog on a regular basis have days when we just do not want to even look at a blank piece of paper that we need to convert into a worthwhile post. However, after a while,  inspiration does come and one begins writing. Sometimes it really feels like magic to me when you have just get started on a single point and suddenly….. you have a post, one that you can be proud of. I don’t always think its magic! More often than not it is a mixture of passion, hard work and persistence. However the most important ingredient in all this is that we need to enjoy the process. When you have fun doing something it becomes easy to do it and you no longer need to push yourself too hard. To top it all off, a single good comment on the post makes my day and it  all worthwhile. The fact that someone out there was able to connect with what I have written is an awesome feeling.

When one starts to blog just for the sake of blogging, it saps out all the fun from the process. That is why I had mentioned passion being supremely important when selecting what one wants to blog about. In the end however it all comes to down to doing something you have fun with and enjoy doing. It’s almost a year since I first started blogging,  I don’t think I would have made it all the way here if I had not had so much fun along the way. Seeing my readership numbers steadily increase, increased number of comments and the links that I have made this year have all been an added bonus.

This lesson has a wide application through our life. We sometimes make choices and decisions that appear to be the ‘right’ one at that point of time  because society deems it to be so. It takes a lot of courage and faith in one’s own ability to go off the beaten path, specially if that is one that does not bring us the sort of excitment and joy we want. Going off the beaten track is almost always a much more challenging route to take, with a whole bunch of obstacles along the way that remind you it is not too late to turn back and get back on the accepted track. However, if you follow a path that brings you a level of excitment, joy and most importantly the satisfaction you desire, very few things should persuade you to stop doing it. I hope everyone has the strength and courage to follow their heart  and may they find great success in doing so.

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Lesson #9: Networking

“The currency of real networking is not greed but generosity.” Keith Ferrazzi

A lesson I learnt late in my blogging journey was networking effectively through the blogsphere . When I started this blog I had a tiny blog roll and did a poor job of linking it to other articles and posts. It is only recently that I have discovered how effective linking can be, not only to promote  visibility of your blog but to network with other bloggers who may be writing in the same niche as you. The fact of the matter is that the multiplier effect gets amplified definitively through the internet. A blog post can suddenly become viral, and  your blog can experience an enormous amount of traffic. Even though I have put much heavier emphasis on creating quality content for my blog since the beginning of this year, I should not have neglected the power of developing deeper relationships with authority figures in my niche to help in the expansion of this blog in year 2.

If I were to start my blogging journey again from the very beginning, I would place much greater emphasis on networking and linking . Listed below are a couple of steps I would have followed to build up my blog’s visibility through networking and linking:

1. Join twitter as soon as possible. Thanks to twitter I have built up close relationships with many bloggers since I started actively using the service a month ago. If I had put in the same amount of effort from the very beginning of this year I am pretty sure my blog’s traffic would be much higher, I would have had better relationships with  many prominent bloggers and I would hence have developed a channel through which my blog posts could become viral almost instantly.

2. The blogroll on my blog is very weak. It barely includes any of the blogs that I read on a regular basis. Developing a substantial blogroll is another factor that I would pay more attention to if I were starting this blog over again. This way I would appear on the radar of some larger blog sites and it would also help my readers to link to many relevant blogs in the same niche.

3. Commenting is a powerful strategy to bring visibility to one’s blog as well as to integrate it into conversations taking place online. Comments provide a great platform to showcase opinions and suggestions which could help attract new readers to one’s blog as well as develop closer relationships with other bloggers.

These are some straegies that I would use to build stronger networks and deeper relationships with prominent bloggers in my niche. The sooner we begin putting in that extra effort to develop these relationships the sooner we will see results of our blogging effort. If any reader has any good link to articles that discuss linking or networking through blogs I would appreciate it if you could post the links. Thanks.

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Lesson #8: Patience

“Genius is nothing but a great aptitude for patience.” George-Louis de Buffon

Instant results and gratification seem to be the mantra of my generation. It is undoubtedly and definitely nice to get things whenever one wants them. However there is usually a fair amount of work/effort that needs to be put in before you see any tangible results. Blogging works in the same way. Expecting to make 6 figures from your blogging efforts right off the bat is wishful thinking. One can use all the SEO (Search Engine Optimization) tricks out there, but the truth of the matter is, if we want to see sustainable long term results it is only going to be through pure hardwork. It sounds cliche’d as I write this, everyone knows that it takes a lot of effort to do anything of substantial value. What we tend to lose sight of along the way is the patience to hang on to what we are doing. I personally know many individuals who started blogging only to leave the habit a couple of weeks or months later. They may not have got the level of traffic they wanted or made the sort of money they were looking for.

Its quite disheartening to check your stats and see that only 3 other people on the web have read your post. All the hardwork that has been put in still does not us the results we ‘think’ we are due. Here lies the problem, our expectations  from our blog need to be tempered right from the start. If you are really serious about making money or reaching a certain traffic level for your blog then one needs to put in an adequate amount of work. If there is something I have learned over the course of the last year, it has been that making a living solely by blogging is very hard work. It is not impossible, however it requires the same level of persistence, determination and effort that any other startup venture may require.

The beauty of the internet is its ability for the rapid exponential growth of your blog. A blog that is growing at a monthly pace of 10% will see traffic increase steadily through the course of the year and eventually those numbers will begin to multiply. Therefore, focus on your content before anything else, build a group of readers that follow you on a regular basis and continue to grow your base on a steady basis. With good content, regular updating and being relatively proactive through online social mediums you will reach your goal. Just don’t lose hope half way through… success usually comes to those who have the ability to continue hanging on when everyone else has given up.

Related Posts:

5 Steps to Patience

 

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Financial Metric #4: SG and A Growth

“There is one rule for industrialists and that is: Make the best quality of goods possible at the lowest cost possible, paying the highest wages possible” Henry Ford

Sales, General & Administrative (SG&A) expenses include, all salaries, indirect production, marketing, and general corporate expenses. This constitutes the bulk of expenses that a business incurs and should be constantly reviewed. The entire concept of running a lean enterprise extends from the fact that we use an optimal mix of resources to achieve our target goals. However, this is usually not the case in the real world and businesses tend to inflate costs drastically whenever they have some success. This creates an unhealthy dependence on extra resources and also leads to complacency within the team. When cuts need to be made during recessionary periods,  there is a detrimental impact on the team’s overall performance in such organizations. From the onset we have to continuously monitor our SG&A growth in relation to revenue growth as well as industry averages. This helps keep an eye on the ball and puts emphasis on efficiency. When evaluating this metric there are a couple of factors to keep in mind.

1. SG&A Break Up & Alignment: How are costs distributed through the business? We need to identify which costs contribute significantly to overall costs. This helps us map out IT, marketing, sales, payroll and other components which usually make up the bulk of expenses. Once we have this breakdown, we can analyze each component further and see how it contributes to the overall strategic vision of the company. If your company has a short term goal of increasing market share in its industry through mergers and acquisitions, there needs to be focus on getting the right people on the team instead of bulking up marketing expenses. We see hence how breaking up the SG&A and aligning it in accordance to the business vision is important.

2. ROI: Each major component such as IT or marketing, needs to be measured. When assessing your business it is important to delve into each component to gauge which technologies and campaigns are delivering an acceptable ROI and which are not. This exercise highlights non performing costs which are being incurred without adequate return. It is through this exercise that one can eliminate these costs and make the entire business more efficient.

3. Growth %: One also needs to pay attention to how fast the SG&A figures grow when the business begins to scale. This percentage needs to be kept in check and must be reviewed regularly to ensure that costs are not being overly inflated with growth. This usually happens when we begin to hire too many people, launch unnecessary marketing campaigns or have technology infrastructures implemented when not needed. This leads to erosion of operating margins and can have a detrimental impact on growth. If possible benchmark your SG&A against industry averages as well to ensure that growth is specifically aligned with the overall strategic direction the business wants to take.

SG&A needs to be kept in control and be constantly reviewed. However, I do not like pegging its growth to some budgeted figure. SG&A growth needs to be aligned with the business vision. Restricting it from growing over a certain percentage may have a short term benefit to the business, it may however prevent it from reaching its long term goals.

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5 Tips for Better Cash Flows

“Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks.” Warren Buffet

Mismanagement of cash flows is a leading cause of failure among businesses. Business owners do not realize how critical it is to budget and plan cash flows from the beginning of the venture and most times a liquidity crisis catches them completely off guard. This often leads to irrational last minute maneuvering which amplifies the problems at hand. To ensure smooth cash flow cycles we have to ensure that we are extremely vigilant of the financial health of our business from the onset. This may appear to be over simplistic advice, however the truth of the matter is, not enough emphasis is given to this function. The excitement lies in closing those million dollar deals and creating fancy marketing campaigns. Reality of the matter is that if we do not have the financial structure in place to support these deals and campaigns we will soon find ourselves in a lot of trouble. Listed below are a couple of tips which have helped me manage cash flows better.

1. Inflows & Outflows: From the onset identify your inflows and outflows. If you have adequate historic data, map out how long on average it takes to receive cash after providing your product/service. Next carefully map out all your expenses, and dates when they need to be paid. Next we have to minimize the time between the two flows. Usually inflows are much slower than expected and this needs to be compensated by negotiating favorable agreements with suppliers, stocking less and invoicing your customers at regular intervals. To learn more about the importance of mapping out inflows and outflows please click here.

2. Cost Management: Cost cuts do not necessarily require a business to layoff staff or drastically cut marketing expenditure. I take the approach of measuring cost effectiveness in terms of every product or service that the business is providing. The goal must be to provide the product or service at a lower cost than the competition. Identify all direct costs, incremental costs of increasing volume, fixed costs and overall cost structures in comparision to the competition. This does not necessarily have to be reflected in lower price points. As we widen the cost comparison between competitors, we are able to hold a much stronger position in the overall industry. To learn about each cost in greater detail please click here.

3. Marketing: Cutting marketing expenses to conserve cash is often not the most optimal solution for solving one’s cash flow problems. Assessing marketing strategies and tactics needs to be practiced on a regular basis. It is not wise to make marketing expenses cyclical with business cycles. With optimized marketing campaigns and strategies in place, a business has greater chances of avoiding these cash gluts as business is constantly being generated at a healthy level. To learn more about marketing strategies during a liquidity crunch please click here.

4. Technology: Gone are the days of keeping track of your business expenses on excel sheets. As a business owner today we should use one of the many accounting packages available to make sure we always have a financial snapshot of the health of our business. This will provide us with the ability to quickly identify trends and potential liquidity crunches before they take place. Please click here to read five questions you need to answer before selecting which accounting package is right for you.

5. Last Resort Measures: There will be times however when a liquidity crisis will hit . It is important that when it does we remain calm and evaluate the options we have instead of making rash decisions. The options I have used during these period of times are, discounting, credit cards, loans from friends and family, invoice factoring and secured credit lines. All of these options need to be used when all other alternatives have been exhausted. Attention needs to given to ensure that all documentation has been read carefully and that one is fully aware of the pro’s and con’s of each measure. To learn more about each measure please click here.

Those who have experienced liquidity crunches realize how stressful and frustrating these cycles are. They can result in partners leaving the business, unpleasantness at the office and even eventual closure of the business. Using some of the tips provided above we can avert a number of these situations. It comes down to better financial planning and catering for unforseen events. We have to be prepared when such situations arise and must deal with them face on. There is no need to dig ourselves deeper into a hole by using temporary fixes. If the business that you are running is repeatedly running into cash flow problems, do your best to re-engineer it from the ground up, or have the discipline to change boats.

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Getting out of a Cash Crunch

“When you’re in a pit, the first thing to do is to stop digging.” James Ellman

At some point of time or other most entrepreneurs go through a cash crunch period. These are stressful and frustrating times when the world seems to be falling apart around us and we have a limited set of options to get out of the mess. I have found that by following the tips provided earlier in this series we can reduce the probability of being stuck in a liquidity crisis substantially. However, there are times when even after having planned for every conceivable outcome there is a blind spot we missed out. The important thing to do at this point is not to panic. Cutting your marketing budget, laying off staff and hawking office equipment on ebay is not usually the answer. In a situation where we have exhausted options of negotiating extensions with suppliers and run out of excuses why we have not settled the rent, there are a couple of alternatives I have used. Listed below in order of my personal preference are:

1. Discounting: If we are in a quarter with a number of payments due I include a clause in outgoing invoices stating that if payment is made within x number of days there will be an x% discount. This creates monetary incentive for clients to pay up on time. If invoices have been pending for a while I give the same discount to the client stating they should pay the discounted bill or we would be forced into calling in collection agencies. Surprisingly I have had very good results using this method in speeding up payments causing strapped up cash.

2. Credit Cards: I personally do not advocate using this type of financing but when the situation calls for it, use it as an emergency backup. These can be either business applied credit cards or personal cards. Using the cash advance option, essential payments can be made. This will help tide through the business until payments are made by clients. Using this option for any other expenses other than these critical ones results in getting buried by ridiculously high interest payments. Instead of fueling growth for your business this stunts growth. Use it with caution

3. Loans from Friends & Family: If you are in desperate need of some bridging capital and need access to it quickly, going to friends and family is a valid option. I do not like mixing friends and family with business, but at times it is unavoidable. Make sure when you take the money there is an agreement with terms and conditions spelt out in black and white. Full disclosure must be made regarding the situation at hand as well as when you are expected to repay the loan. Conflicts tend to arise when inadequate information is given, this results in confusion and unrealistic expectations.

4. Invoice Factoring: For businesses with natural and steady flows of revenue, but prone to erratic payments, applying for these schemes through banks or specialist factoring companies is an option. These basically take into account your average business activity and streams of revenue, then provide you a credit line against it. This can free up much of your working capital and can boost growth. However read the fine print carefully. Sometimes these institutions limit who you can do business with, and can also force your clients to interact with them as far as payments are concerned. This reflects negatively on the business and does not convey a good image to your customers.

5. Secured Credit Lines: If one is expecting the next couple of quarters or year to be tight, taking out a secure credit line may be a good alternative to solve the liquidity crunch. The bank provides you with a line of credit which is usually secured against a particular asset. The asset is usually real estate which you or the business may own. The business is then able to borrow money against the asset conveniently. This is an option exercised by many entrepreneurs. However it takes time to setup, therefore one must plan for it well in advance and not when you are stuck in a liquidity crisis.

No one wants to be stuck in a liquidity crisis. We must do all we can to ensure the business does not slip into one. Keep your eyes on both the sale numbers and controlling expenses. When and if the situation becomes critical these last resort measures can provide significant relief in assisting you to get out of the mess. It is important to use these options wisely and to do thorough research on them before committing to any one of them.

Related Articles:

Raising Capital from Family & Friends

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Technology and Cash Flow Management

“What amount of value creation can be assigned to the efforts of management for a particular time period? That is the essence of accounting. Otherwise, it’s simply an appraisal process.” Charles W Mulford

Gone are the days of keeping track of your business expenses on excel sheets. Earlier on in my entrepreneurial journey we relied solely on excel sheets to manage accounts. However we were then introduced to Quickbooks, and it completely changed the way we viewed our accounts. With this software we were actually able to extrapolate a lot of data and zoom into key metrics by which we could monitor the growth of our business. Many business owners wait until they have an ‘established’ business before investing in standard accounting software. This is like wearing a helmet after you have experienced a fall. Undoubtedly experience is a great teacher and one should continue to learn from mistakes. There are however some precautions which should be taken beforehand, and getting software to manage your accounts is one of them.

There are many great accounting solutions available in the market today. These key questions need to be answered when selecting an accounting package:

1. What is your budget allocation for purchasing this software? (If a budget has not been allocated there are many free accounting solutions which one can find online)

2. Do you want the software to run locally on your computer or would you want web access to your data?

3. How many users will be using the software?

4. What is the primary purpose of purchasing the software? (Do you require a simple application which helps to track all of your incomes and expenses, or do you require one through which you can manage inventory, payroll, invoices etc)

5. What level of reporting will be required? (If one requires simple profit/loss, cash flow and balance sheet statements there are a lot of great packages out there. For more complex reporting, software like Quickbooks premier can generate detailed reports on sales report per employee and profitability per product)

Once these key questions have been answered, you will have a better idea for the sort of solution required and your search would have been made easier. When you have selected a software, assign someone or a group of people to continually update it to ensure access to the latest activity. This acts as a safeguard and protects over exposing the business to unnecessary risk as well as maximizing the opportunities currently in hand. I plan on creating a widget which will compile the answers to the questions above, and help provide a list of appropriate software or services. If anyone would like to help me out in creating it please let me know at blog (at) usmansheikh.net

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Cutting your Marketing Budget?

“Marketing is not an event, but a process . . . It has a beginning, a middle, but never an end, for it is a process. You improve it, perfect it, change it, even pause it. But you never stop it completely.” Jay Conrad Levinson

The quote above encapsulates the essence of this blog post. I don’t think anyone could have said it better. I am a fan of all Mr. Levinson’s work especially his book “Guerrilla Marketing”. In the book there is constant emphasis on marketing being a process which we cannot cut whenever things get tight. As I mentioned in my last post, costs need to be contained tightly if we are to reach our goal of attaining a positive cash flow. What I have noticed is that whenever things get tight, cash flow wise, many entrepreneurs tend to pull the plug on marketing expenses in an effort to control costs. This however leads to a decrease in new business development, which ultimately results in decreased revenues.

Cutting marketing expenses to conserve cash is often not the most optimal solution to solving one’s cash flow problems. Assessing marketing strategies and tactics needs to be practiced on a regular basis. For example we could be advertising our new virtual assistant services on the front page of a popular web portal. We have continued to run the ad for the last quarter but have barely broken even on our investment.  We find however that ads running with much greater ROI on a couple of niche blogs and portals relating to the GTD methodology. As a business owner we should assess these trends on a regular basis and change out strategies likewise. If we take the approach of cutting all web advertising, it is more like amputation instead of laser point surgery.

These budgets and control measures need to be adopted from the onset of your business venture. It is not wise to make marketing expenses cyclical with business cycles. With optimized marketing campaigns and strategies in place, a business has greater chances of avoiding these cash gluts as business is constantly being generated at a healthy level. If you are currently experiencing cash flow difficulties in your business, assess your marketing budget and find ways to optimize the cash available to you in order to maximize your ROI.

Related Posts:

Marketing Budgets & Controls

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How lean is your startup?

“Excess cost can be created by indirect factors that aren’t immediately apparent. You can attack these costs only by getting to the real heart of the problem, rather than just bashing away at the cost itself. The three biggest indirect cost generators are time, complexity, and poor quality.” Andrew Wileman

These days there is a lot of talk about shaving costs and becoming more capital efficient. With the credit markets the way they are, just about every venture capitalist has sent out doomsday emails telling their portfolio companies to brace themselves for tough times. I understand that market conditions are very bad, however what I fail to understand is why such emails are not sent out on a regular basis to portfolio companies. As companies become more adept at providing products and services there should be a natural downward trend in their costs. If such a trend is not becoming apparent the business needs to re-evaluate it’s position and figure out where it is leaking cash. From a cash flow perspective this is an extremely vital exercise. If costs are allowed to inflate without sufficient increase in revenue and benefits of economies of scale, the business is headed straight for trouble.

I take the approach of measuring cost effectiveness in terms of every product or service that the business is providing. The goal must be to provide the product or service at a lower cost than the competition. This does not necessarily have to be reflected in lower price points. As we widen the cost comparison between competitors, we are able to hold a much stronger position in the overall industry. Some questions that you can ask yourself to determine how lean your startup is, are:

1. What are the direct costs associated with providing the product or service? If you are selling used mobile phones through the internet for instance, then some of these costs would include; procurement expenses, hosting of a website, marketing campaigns for the website, and delivery costs to customers.

2. What is the incremental cost of producing one more unit or providing another service? Over time economies of scale should kick in and we should see a fall in the incremental cost. In today’s world, thanks to the internet the cost of delivering the same service to many customers has very little incremental cost. For instance if you set up a web service to provide an ability to create invoices, the architecture can be used to serve 1 or a 1000 customers. What needs to be identified is, when does one need to add more servers or optimize the architecture to handle more users.

3. What costs remain unchanged irrespective of volume of products and services provided? These are your fixed costs. One needs to find a level of products and services to ensure we break even. These costs must be contained in order to reach positive cash flows and profitability faster. Services such as Amazon’s s3 cloud computing services provide new web startups the ability to scale much faster and keep fixed operating costs at a minimum. Finds ways how you can reduce your fixed operating costs.

4. How does your cost structure compare against your competitors? This is often difficult to assess but it is possible to get a rough idea after doing some research regarding the competition’s processes. Once we can assess areas of advantage and disadvantage we can build on these segments respectively.

Cost cuts do not necessarily require a business to layoff staff or drastically cut marketing expenditure. If costs are inflated to begin with, these cuts need to take place whether we are in a boom cycle or a recession cycle. The focus needs to be placed on ensuring we optimize reduction of overhead counts, at the same time not letting our growth stagnate. An equilibirum needs to be found, once we have thoroughly assessed the business we will be able to reach such a level.

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