Publisher’s Notebook: Startups demand planning, frugality

Careful, would-be entrepreneurs.

Anyone considering starting a business would do well to read our Business Startup Guide, which begins on page 13A of this month˜s edition. The guide not only provides a host of tips on everything from financing to hiring, corporate structures to budgets, but also relates what people should consider before venturing out on their own.
Some of these articles were reminiscient of The Northern Colorado Business Report˜s own beginnings. And, indeed, after entering just our third year of publishing in October, we probably remain in that "startup" mode. But, like most — hopefully — business owners, we get smarter, leaner and more efficient every day.
We˜ve learned, as did Beth Barr, owner of Clear Choice Advertising in Greeley, the value of begging and bartering. Most businesses can probably find good alternatives for expensive office furniture, computers, etc. — alternatives that can keep cash in hand for as long as possible. We, for example, did a little of everything to obtain desks, chairs, bookcases light tables and other equipment for our employees; we traded for some, bought some and were donated some. In the end, our capital outlay for such equipment was negligible.
When moving our office to a better location in the garden level of our building, we did most of the work ourselves (which is why the drywall seams are so readily visible). But we saved thousands of dollars in construction costs.
Businesses of every type can find ways to trade costs away. Barr traded her expertise in developing business plans for an upgrade of her computer system.
We also ensured that we did business first with those who did business with us. While some businesses might not like that approach, it makes sense from a startup business owner˜s perspective. It˜s first and foremost a way to return the courtesy of business coming from the other end, and it ensures that the money that goes out in payables at least partially returns in receivables.
Startups must watch costs very, very closely. With the vast majority of businesses failing in the first year, hanging onto money for as long as possible is critical to a business˜ survival. We continually find more-efficient ways of doing business, kicking ourselves for not thinking of them sooner.
Any business should constantly evaluate expenditures of every type. What˜s the best long-distance telephone service? What˜s the best local service? How much are you spending for office supplies? Do you really need that new computer?
We˜re smarter about hiring, too. Startups demand a special team of people who are excited about the prospects of helping a business grow, of being in on the ground floor, of making contributions that really matter to a business˜ survival. We ask questions and demand qualifications of job prospects that we hadn˜t even conceived of in the summer of 1995. Anyone wanting to work here today will know that we˜re very serious about hiring the best people possible.
With time also comes discipline. Perhaps the greatest attribute that a business owner can possess or develop is ability to manage time effectively, to delegate when necessary. Knowing what you should be doing vs. what an employee should be doing builds profitability. High-payoff activities mean just that.
But anyone thinking of starting a business shouldn˜t be deterred by the challenges that await them; they should welcome them and be prepared for them. Proper planning, with a well-thought-out business plan, will boost your chances of success immensely.
So, be careful, yes. Smart, yes. Frugal, yes.
Then go for it.Christopher Wood can be reached at (970) 221-5400, (970) 356-1683, (800) 440-3506 or via e-mail at [email protected]. His fax number is (970) 221-5432.

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