It’s okay to say it - 2020 (and some of 2021) was a dumpster fire for many businesses. The uncertainty caused by the pandemic sent most small businesses into a tailspin without a clear end in sight. It’s now been more than 18 months since the pandemic was officially declared and since then, much of the U.S. along with the rest of the world has endured the rollercoaster of starts and stops while keeping up with the efforts of federal, state and local governments’ attempts to juggle public safety measures while mitigating economic harm. The early part of this year wasn’t so hot either, what with repeated surges of infections while the initial dust began settling atop this “new normal” we’re all becoming accustomed to in our daily lives.
The good news is that recovery from the pandemic might finally be around the corner (fingers crossed). We can likely attribute that to a few different realities, including continued rising vaccination rates, the recovery of infected people, time, and let’s not discredit the fact that we’re all basically just getting better at dealing with uncertainty.
So, what’s next for businesses in 2022? With about 99 percent of all U.S. businesses being small businesses, made up of just under 32 million of them as of March 2021, what does a small business owner have to do to get ready for growth in the new year? And, what kind of small businesses are currently experiencing growth?
Believe it or not, it might just be the perfect time to start a new business.
2021 is proving that certain types of services and products are perhaps in the highest demand ever.
This list is in no way meant to be exhaustive but if you’re in one of these professions or you want to be, 2022 could very well be looking up for you.
Car wash services
Business and marketing courses
Consulting and business coaching
Social media management
Bookkeeping and accounting
If these businesses are currently the most profitable businesses, then it’s not too hard to see that consumers are focusing heavily on self-improvement services and business to business services.
So, okay, you’ve been bitten by the entrepreneurial bug and are joining the ranks of business owners who’ve come before you to strike out on their own. Are there risks to going out on your own and being your own boss? Sure. But, are the rewards worth it? Well, let’s ask the nearly 32 million small businesses currently operating in the U.S. that account for 99 percent of all U.S. businesses.
If you’re just getting started, where to begin? And how do you approach this undertaking when you don’t know what you don’t know?
Choosing the Right Business Structure
It really can’t be overstated that choosing the right type of business entity is super important to your operation. Look at it like cooking a meal. Before you begin, you’ll need to figure out what you’re making and what type of cookware and ingredients will get the job done. Not every tool or instrument will give you the outcome you want. Try making a stew on a griddle and you’ll see what I mean. There are several different types of business structures that you must consider when starting a business and figuring out which one will work best for your plans is crucial. Whether it’s a Corporation, a Limited Liability Company or a Partnership, etc., it’s important to understand that each entity type has different legal requirements not only during the formation phase but also into the future as you grow or expand. If you’re like most people and are driven primarily by ambition and a little caffeine rather than a killer business plan, then you’ll at least need to figure out a few essential things, like whether you should fly solo or take the plunge with a partner or whether you need investors and how much ownership stake you want to give up in exchange for financial help. It’s also necessary to figure out how you plan to manage the business, who will have decision making power and over what, and how you will compensate yourselves and share in the profits and losses. A smart business owner also learns about setting up safeguards like insurance and enlisting other professional resources such as legal counsel for contracts, employment issues and advice, professional accounting to handle tax matters, bookkeeping and more. Often, startups fail to consider things like creating systems and processes that address how to handle disagreements, differences in management style and settling disputes, which end up harming the business, hurting the profits and destroying relationships.
How a business is legally formed from the start will influence and affect every aspect of that business.
Creating Systems To Address Bumps in the Road
A business is a lot like a marriage and regardless of whether a business owner is tied to a co-owner or operates as a sole owner, the arrangement between the owner and the operation itself also requires a certain level of commitment to doing things that strengthen the business.
Running a business involves not only complying with applicable local, state and federal laws that govern that type of business, but also having internal processes that set you up for smoother sailing and success. How customers are greeted in person, over the phone or through e-mail, what information is available when they are considering signing on or buying, what policies have been created and implemented to communicate the business’s objectives, whether employees are trained to deliver the intended customer experience or handle problems that arise, billing practices, or what information appears on a website or social media that helps to showcase and market the business’s strengths. These are all opportunities as well as potential pitfalls within the galaxy of crucial touchpoints that can make or break a business. And, these moments also make up the reputational identity of the business and its owners, which becomes how the business is ultimately known to its public and its competitors.
Whether you’re selling your services or your wares, customers and clients alike want and need an experience worthy of their time and money.
Ready, Set, Grow
If you’ve been around the block at least once already and can count among your accomplishments a business that’s already set up and running, it’s a good time to stop and take stock of where you’ve been and where you’re going. Not to wax on about the pandemic and all the ensuing challenges it brought to basically every sector known to man, but looking toward a post-pandemic era, U.S. businesses have learned how they are more vulnerable than they thought when uncertainty strikes. In the future, business owners can take steps to be ready for potential problems ranging from premises issues and employee safety to corporate responsibility and communications matters, local government compliance issues, supply chain disruptions, contracting problems, real estate issues, labor shortages, job losses, illness, rising costs -- you name it.
So, given the mountain of “new normal” problems that have become a part of our day-to-day awareness, how can an existing business owner make up for lost ground or keep up with the shifting tides long enough to see his or her way into a better 2022?
The answers may not be so groundbreaking but some tried and true practices still apply:
Value your team. If your loyal employees have stuck by you this entire time, make sure you remind them of the reasons they came onboard in the first place. As things gradually get better, a motivated team with good morale is the most valuable asset to an organization’s recovery. In the long run, everyone will remember that the unit survived the hardest of times because they worked together toward a common goal. Remember that relationship building always pays dividends.
Get help where you need it. With our reliance on technology, maybe the world has become a lot smaller because information is so much more readily available. But, know that not all information is good information. Don’t just rely on your social media friends or general forms found online to tell you what your business contracts should say or by which rules you should abide. Do yourself a huge favor and get business counsel who’s properly familiar with that subject matter and can help you stay out of legal trouble. And, when it comes to tax matters, be sure to loop in a financial professional to help you manage all things money. They don’t call it professional services for nothing.
Learn from your mistakes. In business, challenges bring problems and problems create opportunities. There isn’t a business anywhere that has never experienced problems, so use that to your advantage. Be willing to recognize when something you did or failed to do or a decision you made didn’t work out quite as well as you had hoped and use that key learning to anticipate issues to avoid in the future. Challenges help business owners turn problems into processes. For example, I recently spoke to a business owner who was concerned that his employees might share sensitive information about the business operation on social media and potentially cause damage to his professional reputation and that of his business. Anxious that any negative comments appearing online could alienate his audience, he hastily instituted a sweeping social media ban, which subsequently backfired, creating discord among staffers and prompting the need for in-house damage control. From this example, a business owner has a prime opportunity to implement some internal communications strategies with employees and educate them about company policies that benefit both employee and employer. Channeling energy into promoting a good workplace culture and encouraging the right kind of information sharing can really elevate a business’s reputation and fortify its position in the marketplace. In another example, some types of businesses are more prone to liability than others and some owners end up learning the hard way that their goodwill only goes so far when a dispute arises. Getting advice in advance on whether the use of written waivers and other contractual agreements to reduce liability would be appropriate and could mean the difference between being protected against expensive lawsuits or getting dragged into court. Nobody wants to be finished before they’ve even gotten started.
So, whether you’re thinking about becoming a business coach, starting a website building service or creating an online personal training platform, your success in 2022 comes in part from the wisdom you’ll have gained during the trials and tribulations of the recent months. Before you get started, be sure to compile a list of questions and reach out to the appropriate professional for help. Getting help makes you stronger, not weaker. Remember that getting started on the right foot with all your legal ducks neatly lined up can only maximize your opportunities, help guard against catastrophic mistake-making, save money and minimize hurdles down the road.
And with that, grow forth and conquer.
For more information about business startups, visit www.relatelaw.com.