How do I know if my new business is on track?

How do I know if my new business is on track?

SHARE

How do I measure the progress of my start-up to make sure I’m sticking to the right path?

Are we there yet? Many start-up business owners ask themselves this important question in the quest of trying to figure out if their hard work and inputs are yielding any results.

Knowing the progress of your start-up business is crucial. This assists with highlighting where the business needs to improve and also indicates where its strengths lie.

In order to measure the progress of your start-up business, you will need to consider the following:

First start with a plan

An action plan is needed when the business is started; this will map out the path of the business, including goals and sub-goals with the necessary timelines that will indicate the targeted date of completion.

The main objective of many start-up businesses is to make a profit. This action plan will map out the steps necessary to achieve this objective.

The plan should be reviewed frequently to see if your business is meeting its goals. If there are any major changes in the business, the plan should be updated in order to adjust to new business needs.

 

Entrepreneur-Newsletters
Entrepreneur’s daily tips & insights delivered direct to your inbox.

Do the maths

When you start your business, you will need to calculate the break-even point.

This is the point where the expenses of the business are equal to the income. The break-even point will show you how much of your products or services you will need to sell in order to cover all your business expenses. This calculation will also indicate when this break-even point will be reached.

Therefore, you will know in which month or year, this point will be reached.

Why is this important? Many start-up businesses operate at a loss for the first months or years of operation. This is due to the newness in the market and lack of customers. You should assess your finances regularly, in order to see if you are on the right track and will reach the sales levels determined by the break-even calculation.

Planning for success

Once these measures are in place, you can start looking forward to reaping the rewards of your hard work by planning for expansion, judging what you will need in terms of resources such as office or factory space, who you will need to hire and what you will need to budget for growth.

Busi Raphekwane
Busi Raphekwane is a business mentor at The Hope Factory and an entrepreneurship activist who is passionate about the development of entrepreneurs and small business. She has a keen interest in contributing to the small business development sector thorough research and is always looking for best ways of developing entrepreneurs. She is currently completing her Masters’ degree in Entrepreneurship and Small Business Management; and has an undergraduate degree in Accounting Sciences. Apart from her work with The Hope Factory, she has also mentored 29 businesses at the University of Pretoria Business Clinic.