The Best Business tips & advice

Best Business tips & advice

Table of Contents

Small business advice, Business principles and management

Welcome to my blog, which is a collection of 1001 tips and pieces of business advice. These are ideal for small businesses but will be equally helpful in larger businesses and business units of large businesses. Please check back frequently, as I’m constantly adding to this blog and tweaking the advice. I’d love to hear from you, so if you have a tip I haven’t listed or have some feedback, please leave a comment below.

Business tips and advice on starting a business

I think you will find that working through this blog will give you lots of good business advice for whatever sort of business you want to start. At this stage, I would also ask you to try the “7 Why’s Test”, which starts with asking yourself why you want to start a business. You might say “to make money”, ask “Why” again, and keep going at least 7 times.

If you are starting a business because you don’t like your boss or working for someone else, then stop and seriously think this through. If you expect to get paid, you will always have a boss in the shape of customers. You may also have a boss in the shape of investors. Customers and investors will be unforgiving. When you understand this, you may also appreciate your current bosses’ point of view and find it easier to progress your career working for them.

How to get a new business or project started

Finding reasons not to get started is so easy. What are you waiting for? There will never be a perfect time; you will never have all the information, all the skills, all the right people, a perfect plan or enough money. Here are some words of wisdom that I recommend if you are procrastinating:

Start where you are, use what you’ve got, do what you can.

Arthur Ashe

The longest journey starts with a single step

Lao Tzu

You’re never too old, never too bad, never too late and never too sick to start from the scratch once again

Bikram Choudhury

The key message in these famous quotes is to take the first step if you want to do something. What’s the worst that can happen? If you fail, great. You’ve learned something, so don’t waste it; start again. This reminds me of another quote, “Fall down seven times, stand up 8”. It’s also true that many successful business leaders have had their share of difficulties and setbacks. What separates these successful businesses is that they don’t give up.

Measure what is important.

Getting started with data collection

There is an old business saying, ‘If you can’t measure it, you can’t manage it’. This is still true today. Any process, be it cars washed per day, apples harvested, number of phone calls made, or orders shipped, is being left to chance if you don’t measure it and track it.

Once you have decided what to measure, you can monitor it and manage it. For example, how many calls made today, compare this with yesterday, last week, last month, same day last year etc? Then, decide if you need to take some action.

As a manager, you can measure what’s Important. One business owner I know in the early 1990s made a note each day in his diary of the total order value each day of the top 10 customers in his diary. Year after year, he’d compare each day and get on the phone with those customers who had not placed a repeat order to ‘see how he could help’.

These days, instead of a diary, I’d recommend just keeping a simple spreadsheet of key figures, one row per date and items to measure going across the sheet. With the data in Excel, it’s much more easily graphed and automatically compared with the prior year.

Below is a simple example of how a small online store selling children’s toys might track some measurements:

DateUnits Ordered by customersTotal value of ordersPage views on website
May 5th 202050£7,50020,121
May 6th49£8,00019,789
May 7th69£12,00033,567
Simple daily Measurement Tracker

This is a simple example to make the point, but as a manager, you can fit this to your purpose. Using this example, we can see that the sales were higher than the previous days on May 7th. This prompts the question:

Why were the sales better?

What can we learn?

Is there an action we can take to apply this learning to increase future sales?

But also imagine now that you as a manager are looking at these figures again a year or two years later and comparing them with the same day.

Tip: If you attend a regular meeting, for example, a daily stand-up or a weekly sales meeting where numbers are shared, keep your own notes of what key numbers are being reported. It can be immensely useful to have some key figures at your fingertips.

A Single Version of the Truth

As a business grows the numbers being reported or discussed become more confusing. It’s not unusual to have 3 or 4 areas reporting what appear to be different figures for the same thing. This needs to be understood quickly and a common measure agreed on. Let’s take Sales Value as an example. The Sales Manager reports that his team made sales of £500,000 last month. Meanwhile, the Operations manager is reporting sales of £600,000, and the Finance Manager is reporting sales of £400,000. On investigation, they are all right, in their own way, in their own context.

The Sales Manager took orders worth £500,000 from customers. Think of this as new sales.

The Operations Manager Invoiced out sales of £600,000. This is £500K from this week and £100K of backorders from the prior week.

The Finance Manager is showing £400,000 of sales in the management accounts because they had to issue credits to customers for faulty goods and anyway the numbers in the accounts are nett rather than gross.

So, all three of them are correct, but from a manager’s perspective, this can be confusing and worse still, it’s confusing when trying to communicate this to more junior staff. The solution is to agree on clear and concise terms for each. For example

Sales Manager: £500,000 of “New Orders Inclusive of VAT”. This is a useful figure as it shows how hard the sales team have worked to bring in new business.

Operations Manager: £600,000 of “Invoiced sales”, or better still £100K of invoiced backorders and £500K of new business invoiced. This is important as it shows how much work the Operations team have had to do. It also gives content to labour costs in this area, packaging and carriage costs.

Finance Manager: £400,000 “nett invoiced sales”, but better still to break this down and report it as £500K net invoiced sales, £100K net credits, making weekly nett sales £400K.

Agree on which figures you use for various purposes, and don’t mix them up.

Moving to a data-driven business / data-driven decision making

How a business makes decisions is a measure of its maturity and agility. The best businesses now try to measure almost everything. With IoT (Internet of Things), measuring everything that matters is much more reasonable and cost-effective. Even details like the weather are important to capture as they affect performance. Data collection, capture and storage need to be automatic. This is a big topic, and I mentioned it here so that you are aware of it. The value you can get from all this data is immense, but it all starts with data collection, capture and storage. Cloud platforms such as AWS (Amazon Web Services) and Microsoft Azure have IoT (Internet of Things) gateways and pay-as-you-go databases to store the results. Data collection can be as simple as deploying Raspberry Pi’s or similar with sensors or input devices for staff, which communicate the measurements back over wifi to be stored.

But don’t let data drive your business.

For a long time, the idea of a Data-Driven business was seen as an ideal or goal to aspire to. As we discussed above, data is essential to any successful business, but rather than let data drive your business, let it inform your business. The difference between “Data-Driven” and “Data-Informed” is subtle but a world of difference. In Data-driven businesses, decisions become binary and often limited by the available data. Contrast this with a Data-Informed business where space is left for human skill, judgment and intuition. While data will take you a long way, intuition and good judgment are essential skills. If you doubt this, consider two businesses with exactly the same data but run by managers from quite different backgrounds. Would you expect both companies to perform equally? No, taste, judgment and intuition can help one business leapfrog others.

For this reason, try and develop good judgment and good taste and learn how to tune into your intuition. Practices such as learning to appreciate classical music, religion, art, yoga, breathing, gardening, and meditation help to tune the brain’s powers of intuition.

The 80/20 Principle

Perfection is the enemy of progress.

Winston Churchill

Minimise inventory – Stock doesn’t generally get more valuable the longer you keep it.

Avoid, wherever possible, tying up resources in stock. Keep stock as low as you can without impacting the operation of your business and service to customers. This isn’t easy, and while there is a science to it, there is also an element of art involved in some businesses.

When considering a new business venture, I always ask if it involves buying and holding stock. If it does, how is this going to be funded and managed?

Rule: One – Don’t hold stock if you can engineer it out of your process

You may have heard about Just In Time (JIT) Supply Chains. The concept is simple: you take an order and promise, for example, 14, 14-day delivery. The moment the order is taken, you schedule production and place orders with component suppliers to cover the parts required, which are then booked to arrive a few hours before they are due to be assembled. This happens, and production builds the product, despatches it, and invoices it before the parts are even due for payment from your suppliers. This needs tight supply chain management (SCM) and watertight SLAs (Service Level Agreements) with suppliers.

This tends to be the model run by most large, successful factories and supermarkets these days. Few of these businesses carry more than a few day’s stock.

For many online businesses, you may not need to hold stock at all. Retailers can often take orders and then arrange fulfilment directly by the manufacturer to the consumer. For example, many websites sell things like t-shirts with custom designs. When you order from these sites, their custom designs (see IPR) are sent through to the t-shirt printer along with the customer’s details. The printer then does the work and sends the product directly to the customer and invoices for the retailer for the t-shirt and carriage.

Rule Two – If you have to buy and hold stock, you need to understand cash flow.

I will discuss cash flow in more detail shortly, but for now, you need to understand that stock has to be paid for, and you need to know that you will have the cash to pay for it. I’ve seen many businesses with 30-day terms with their suppliers and customers who pay on 90-day terms. So, for example, you may be paying your supplier for stock in January, but assuming you sell it through, you may not get cash from your customer until April. Lack of cash kills successful businesses. There are many solutions, the simplest being you retain enough operating cash in the business to cover these costs until you are paid.

Understand the Pareto principle; it can be applied to most problems

Keep things looking fresh

Communicate like your life depends on it.

Own your digital landscape.

Don’t force your customers to use Facebook, Instagram or WhatsApp.

Many people don’t want to use products and services associated with Facebook for many reasons, such as their algorithms. If you run a business, don’t force your customers or followers to have a Facebook account so that they can follow you and interact with you on Facebook. Many small business owners have found that customers have set up Facebook accounts to interact with their business. That’s not nice, friends, don’t make friends join Facebook!.

Platforms like Mighty Network are a simple alternative to Facebook. For a low fee, they allow you to set up a website and a community which you can monetise. Importantly, if you don’t like what Mighty Networks does in the future, you can download your membership list, including the email addresses and take it to another platform. Do read the small print; however, as with platforms like WiX, there is an element of lock-in with the website, and it gets ever harder to move to another platform the bigger your community and business get.

If you choose a commercial platform like Mighty Networks, remember businesses get bought and sold all the time, and a new owner could take them in a different direction, which you may not like. They may have a policy change in the future and decide they don’t want to host businesses like yours.

Build an email list.

This is a super smart business strategy once you get some customers or traffic to your website. It allows you to keep in touch and remind people you exist. The best also has value as an asset in your business. Email newsletters can contain sponsored adverts or affiliate links. If you are promoting your products and services, in my experience every email campaign generates new orders within 24..72 hours. It can be a useful tool to generate extra revenue at month’s end or quarter’s end!

Embrace Open Source Platforms

In my view, by far, the best option is to use an Open Source platform like WordPress. With this, you download the software (WordPress) and install it on a web hosting account somewhere on the Internet. Thousands of companies offer web hosting online, and if you don’t like the service you get, you can move your WordPress website from one host to another.

You can buy your own hosting package and install WordPress, and many do, but I recommend finding a local web designer who can do this setup for you and manage it for you for a fixed monthly fee. Ensure you have a contract with them and are not locked into them. If you fall out for some reason, you need to be able to get another web company to take over the management of your site.

You don’t need to do social media, and you don’t need a million followers.

Using platforms like WordPress or Mighty Networks, getting just a thousand true followers/people signed up as members or to your mailing list is better. Regarding followers, less is more, and it’s all about quality over quantity. Many businesses can run very successfully and profitably with a thousand or less people on their mailing list – these are your Super Users, make sure you know them and stay in contact with the,. This allows you to know your followers/customers and what they want. You can then make sure you are serving them well with content and new services. In publishing, for example, there are niches where the author and the publisher can name many of the people or institutions that will buy a new book, and they will have them in mind when creating it.

Tip: Less is more; aim to create a mailing list of just one thousand true followers.

Tip: Find your Super Users

You don’t need to be unique to be successful

The person who fails the most wins

Don’t be afraid of making mistakes

Minimise labour: keep the number of people on your payroll as low as possible

This isn’t to say you should not have people helping you with your business. The secret is to outsource and buy services where it makes sense.

Automate low-value work and anything that could sensibly be automated.

Fixed versus variable costs

Generally, it is best to minimise your fixed costs in a business. You will have to pay these costs, even if you don’t make a single sale. For example, rent, insurance, depreciation on fixed assets, and wages for full-time staff. This contrasts with variable costs, which only increase in line with the amount of business you do. For example, a baker will use more flour if she sells more cakes. With variable costs, you should have money from the sales to cover these and generate profit. With Fixed Costs, you have to fund them from the profit made on sales or cash injected (invested) into the business by the owners.

Another example was a business that bought in bulk and sold products through Amazon and eBay. They could have bought or rented their own warehouse and then filled it with staff to receive, store and despatch the products. Instead, they found 3PL (third-party logistic providers) who could do this on their behalf. Once they had done this, they could replicate the model in the UK, USA, Netherlands, etc.

Knowing when to convert a variable cost to a fixed cost

You must monitor this and spot when to convert a cost from variable to fixed. For example, a catering company hires plates, cups and glasses each time they cater for an event. They looked at their costs and identified that they could buy their own coffee cups with what they were spending on hiring them each year. Once bought, these coffee cups could be expected to last for two or three years. Although they had to replace some of the cups over time, most lasted for well over five years. This is an example of converting a variable cost to a fixed cost and then sweating an asset (cups, in this case) to generate more profit.

Create IPR (Intellectual Property Rights)

This is fundamental in many businesses. It was recently summed up by Jeff Bezos when he said, “Create more than you consume”. For example, although Amazon started life as a simple online bookstore, along the way, they needed an IT platform to host their bookstore and growing eCommerce business. They could have outsourced this to any number of IT providers, but instead, they built their own hosting platform, Amazon Web Services (AWS). They used this for Amazon’s own business and then started selling the technology to everyone else.

Another business person built up much knowledge about investing in stocks and shares. He wrote this up and sold his own Guide to Investing. This creates a modest income that continues to this day and has fuelled other business ventures.

What can you create? What can you sell to others?

Focus: Don’t spread yourself or your business too thinly.

There is an old expression, “If you want to dig for water, dig one deep hole, not lots of little shallow holes”. Often, people have a recurring pattern of giving up when things don’t work fast enough for them. They move on and try something else. It is a fact that the difference between success and failure in many businesses is that they don’t give up. When things got difficult, they gave it another day, and that was the day which changed everything for them. Do balance this with knowing when to walk away. It can be sad to see people stuck, sinking ever more resources into something which will never work.

Try using the ICE principle when you need to prioritise a list of developments/projects/changes in your business.

ICE stands for Impact, Confidence and Ease, the three metrics on which projects are scored. This simple tool helps you identify those high-return projects that are highly likely to be successful and can be easily carried out.

Understand Cashflow

You know more than you think

Expect to fail

Doubt is good, but learn to turn down the volume

Use your disadvantages to your advantage

Life and business are like the waves on the ocean

For every down, there is an up. When you are down, be glad that good times are ahead. Don’t take good times for granted, as they will inevitably peak and eventually crash.

There is much to learn from this simple observation of nature.

Root cause analysis and the five whys

Listen to understand rather than to reply. Stop resisting what is happening.

Focus on what you can control

Nail daily habits

Use routines

Stay connected

Know your core values, adapt to everything else

Respond not react

Show up, get through, and make meaning on the other side

Mistakes are all in the past.

By their very nature, mistakes are all in the past. You can’t change the past. Think about how to best respond to a mistake rather than react. What response will have the best outcome for everyone?

All great products start with a necessity

At the end of the day, Business is only about solving a problem for someone else. When you are stuck for ideas or ways to innovate, look at the daily problems in your life, your co-workers and friends, and think through how a business might be able to solve each of those problems and what people might be prepared to pay for a solution.

Don’t blindly copy the next big management idea or fad or try to transplant things that work in one company directly into another.

When Google started allowing 20% time for people to work on pet projects, many other businesses tried copying it with little, if any, benefit. Other trendy ideas come along, like, 360 Appraisals, unlimited holidays and dress-down days. The problem is that many of these ideas started in Silicon Valley, where the culture differs. (Note: I said Different, not necessarily better). Would you expect the culture in a Silicon Valley start-up to be the same as a start-up in Cambridge or Norfolk in the UK? No, they may have some similarities and differences, some good and some bad. Some ideas don’t travel well, whereas others need to be localised. Even within the same town or city, the culture of organisations varies greatly. I once saw someone try to take some policies and procedures from a financial institution, change a few words, names, etc., and put them into a logistics business in the same town. The staff didn’t read past the first paragraph and had to sign the policy blindly. So the manager involved got a tick in the box for having written a new policy and a slap on the back for having rolled it out so quickly, but a few months later, when there was almost zero compliance, a more experienced leader had to tear it up and start again with something right-sized for the organisation and culture.

Is the balance of power right in your organisation?

Where should the power sit in the organisation if your business is creative, makes great products and services and has happy customers? The trap is that the support services, HR, Accounts, Legal and IT stop supporting the creatives and start trying to run things rather than serve the business and the creatives. These support services all have a job to do; for example, the Accountants need to make sure there is cash to pay staff and suppliers, but do you want them constraining product & service development? IT needs to ensure systems are backed up and secure, but do you want them constraining and controlling which tools and services the product development staff use? We’ve all seen businesses where the Accountants have insisted on using cheaper materials to the detriment of the quality of the product. Likewise, we’ve all seen internal IT Teams try to force Windows laptops on staff who want to work on Macs or Linux. If you care about customer service and product integrity, support services ‘support’ the creatives rather than ‘constrain’ or ‘control’.

Master the Forever Transaction and build recurring revenue.

This is a key concept and one that can transform many small businesses. Essentially, you need to avoid chasing many customers and making one-off sales to them. Businesses that do that have to spend a lot of time on Marketing, Advertising, Sales Teams and maybe even pitching for projects. This can account for a high proportion of your operating costs. One of the oldest examples was Wilkinson Sword, who sold a cheap shaving razor that used disposable blades. Once the shaver had been purchased, the user would return to them every few weeks to buy fresh razor blades. These days, I would think twice before getting involved in a business which doesn’t have a plan for recurring revenue.

A local plumber worked hard, installing central heating systems in new houses, but was constantly being pushed by developers to quote low for work or risk losing contracts to another firm. Over the years, he had installed thousands of heating systems, but he never saw them again once they were installed. Developing an annual maintenance contract he could sell to homeowners transformed his business. Now, he charges homeowners an annual fee, including an annual inspection and service and access to a 24 x 365 telephone hotline if they have a problem and need to report a breakdown.

Understand the Membership Economy

Business Advice Mindset: Where the attention goes, energy follows

I love this simple statement, it has been found to be true by sportsmen, muscians, actors, climbers and many other people. At the heart of this is the power of your mind, thoughts, and dreams to shape reality. For example, a musician having difficulty playing a complicated piece of music may take time out to imagine playing the piece perfectly. Climbers frequently mentally complete a climb successfully before starting off, and a yogi may picture a perfect posture or balance. In all cases, people worldwide have reported breakthroughs and step changes in their performance after doing nothing but using the power of their thoughts to imagine success. This is a form of meditation and a skill you should master.

Business Advice Mindset: Avoid excitement, surprises and excesses of all kinds

You must strive to create a calm mind that can focus on ideas and problems for hours if not days on end. If you ask anyone teaching for a few years, they will tell you that students’ attention spans are getting shorter yearly. Children frequently can’t focus for more than a minute to two. When I was in school, you frequently saw double maths lessons on the timetable, and children managed to focus through a long class.

So much in modern life works against this and almost trains us to expect frequent changes, such that when things don’t change, we feel bored. If you don’t believe me, watch almost any modern film or TV program. Try counting the seconds between each scene change. Once you wake up and become aware of the constant rhythm of rapid scene cuts, some films and TV programmes become almost too painful to watch.

I once visited an office where computer programmers tried to do complex work with the local radio station on loud in the background, playing pop music and adverts all day. I had this switched off and found that the quality of work improved, and the team started to communicate more with each other.

In summary, practice focused concentration and avoid things which excite the mind.

Business Advice Mindset: Don’t do anything to damage the environment

Being bad for the environment is bad for business and bad for you and your family. Some ancient peoples lived by a principle of looking at all decisions through the lens of how they would affect them and the next seven generations. This is a great principle for making decisions which we can all adopt. For example, would you build a nuclear reactor if you knew your children’s children would have to decommission it, and they and their children and their children’s children would have to deal with the highly toxic nuclear waste? Likewise, would you sell your product in plastic packaging knowing that it can’t be recycled and will release plastic particles into the sea and hormonal-changing chemicals that reduce fertility? You see, it’s all about perspective, awareness, and conscience. You need to develop your perspective so that it is wide enough and you are fully aware of the impact of your decisions on the present and future. Remember, being good is good for business, for you, and for the next seven generations.

There is also an opportunity to heal the mistakes of the past. There is an old saying, “Where there’s muck, there’s money”. If we extend the definition of “muck” to include “pollution”, that is a good pointer. If we agree that “pollution” is a problem, that’s another good point. At the end of the day, all good businesses exist to solve problems, so along with Space, Computing, and medicine, fixing yesterday’s mistakes will be big business for those who find solutions to that problem.

Business Advice Mindset: Stay off social media

Social media has its uses, but you should be cautious and selective. Particular platforms that don’t charge you a membership fee should be treated with care. Remember, if you are not paying, you are the product, algorithms are exploring you, and AI is far more reaching and clever than you could probably imagine. Whenever I have seen any of the top executives from Silicon Valley interviewed, they have all said they either don’t let their own children on their own platforms or restrict their use.

Business Advice Mindset: Develop good taste

Practices such as learning to appreciate classical music, religion, art, yoga, breathing, cooking your meals from raw ingredients, gardening and meditation help to tune the brain and body to perform at their optimum.

Should you be starting a new project?

Do you have a pattern of starting things and walking away when bored? Or do you see things through if you are passionate about them?
If you answered “yes” to the first question, think carefully about this pattern. Investing and seeing through one of your existing projects may be better before starting something new. You will grow so much through investing consistently there and will have pride as you see the results of your work. There is an old saying: to find oil, you must dig a deep well, not lots of shallow ones.

Managers Mindset: You don’t have to do people’s jobs for them

As a senior manager, your job is to set out the vision, build a team with the right talents, keep them motivated and to bring everything and everyone together to achieve the end goal. Think of yourself as a conductor of an orchestra. A conductor would not try to play everyone’s instruments or tell them how to play their instruments. Instead, they bring the orchestra together, coordinate the efforts and keep everyone on time to achieve a beautiful outcome.

If you have some more Small business tips and advice, please leave some feedback below,

The need for a Contract Database

Supplier Invoice Reconciliation

Customer Invoicing – are you invoicing for everything?

Customer Invoicing – are you invoicing your customer often enough and on time?

Standard Operating Procedures – To grow, you will need help. Make it easy for others to work for you. This simple tip allowed McDonald’s to create standard processes and scale using cheap teenage labour worldwide.

Cyber Essentials

The straw that broke the camel’s back.: Little details and little habits matter. A little neglect here and there will add up and cause failure eventually. Successful businesses are built on evolution and small things being done well rather than revolution. You’ll also have seen the advice ‘don’t sweat the small stuff’. But that doesn’t mean you don’t do the small stuff! Business wisdom is knowing the difference between ‘the straw that broke the camel’s back’ and ‘don’t sweat the small stuff.’

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