Entrepreneurship 101: Financial Setbacks Are a Lesson, Not a Projection

The COVID-19 pandemic caught us unawares. Its impact on businesses, large and small, reverberated throughout societies across the globe as dedicated workers experienced layoffs, reduced hours, pay cuts, or outright job losses due to closures. Some, however, were able to pivot and adapt, delivering to customers what they needed in the present, as opposed to what was available pre-pandemic. Others found a new business niche to exploit.

Out of the many important lessons business owners learned from the pandemic is that, if you’ve experienced a financial setback, take it as a lesson rather than as a death knell. In fact, this is true, regardless of the pandemic. As Great Performers Academy points out, you have plenty of examples proving that one can bounce back from financial hardship and go on to create a successful business — you are not alone.

If you’re ready to take the leap, One Moore Production wants to help and shares the following guidance.

Entrepreneurial avenues

You should have a fair to good idea of what type of business you want to start, so you can accurately determine what your startup costs might be. A good starting point is to look at what businesses stayed strong during the pandemic, as well as which ones started and continue to flourish. A few stark examples include the importance of robust online platforms for everything from delivery services to communications, including video.

With that in mind, an e-commerce business or service that you can deliver online is a promising option. Whatever you decide, your next steps need to stem from a business plan that details the need your business will be meeting, who your target customers are, and your marketing plan. For example, do you have a deliberate social media strategy? What social media platform is the most effective at reaching the people most likely to buy your product or service? And finally, list your anticipated expenses and projected revenue to develop a three-year forecast, with particular attention to your first four fiscal quarters.

Your business structure

A detail not to be overlooked in this planning is your proposed business structure. A sole proprietorship is simple, but it leaves you and your personal assets vulnerable to liability. The last thing you want is to experience more financial woes because of business debt or a lawsuit. Always have in the back of your mind the toll of the pandemic: Coming out of that experience as an entrepreneur should help you be mindful of the number of businesses and individuals that suffered significant losses other than yourself.

With that in mind, consider a limited liability corporation, or LLC. Compared to other corporate structures, you can remain agile and make adjustments quickly if necessary — yet still provides you with tax advantages and some liability protection. If your finances are scarce, save on lawyer fees by using an online formation service — find one that operates according to the laws of your state.

Financial reality

Once you’ve assessed the scope of your current financial situation, it’s important to stop any additional “bleeding” or downward spiral that leads to continued losses. This means cutting as many expenses as you can and prioritizing others. Be sure you outline the available resources you may have access to that will allow you to pay off any high-interest debt, like credit card balances. You can also consider accounts receivable factoring as a way to get a cash infusion as you make recovery plans.

If you still find yourself scrambling each month to pay bills while you’re launching your new business, consider taking a side gig or part-time job temporarily until you catch up or even to help you set aside some savings. From writing to search engine evaluation, online gigs that allow you to set your own hours are prolific.

Stabilize your course

This type of setback is usually a wakeup call for many entrepreneurs. And often, small business owners become emboldened to avoid this type of scenario again as much as possible. With this in mind, Bplans suggests revisiting your business plan to determine whether you need to change course or make adjustments. Also, consider your ability to manage your business. Do you need a better handle on the concepts of business management? If you want to grow your knowledge of best business practices like accounting, operations and marketing, enrolling in an MBA program can provide all of the know-how you need to take your business to new heights. Online options make this an easier feat since you can adjust your studies to fit your schedule.

Smart spending

It’s true that you still have to spend money to make money, but your choices need to be deliberate and beneficial to your business now. For example, it’s absolutely essential that you have a website that looks good and is easy to navigate. While you could build this yourself, you’re better off working with an expert. With the assistance of a professional web designer, you’ll come away with a top-notch site that will help build your online presence. It’s definitely worth the investment, and will pay for itself in no time.

Getting the word out about your business is also important. Reach out to One Moore Production, whose marketing team specializes in voice work for radio, TV and social media. This will help you establish a professional presence in the community, as well as get your message and offerings out to your target market.

When it comes to other items, there are some things you can tackle yourself to avoid overspending. Look to apps that can help you along the way. Like Google Workspace for your productivity suite, or Asana or Trello for project management. These are but a few examples of free or low-cost tools available to up-and-coming business owners.

The strength of experience

Suffering a financial setback can be traumatic, but the experience and lessons learned from that — and from the pandemic — can also be great motivators for your new business success. Through careful planning and by evaluating what businesses did to stay successful, you can transform your not-so-great experience into the business you’ve always dreamed of.

Photo by Unsplash

One Moore Production offers book narration for Audible, voice work for churches, businesses and individuals in a variety of areas including on the web. Contact us for Moore info! 903-570-6303