Management strategies: no more sleepless nights
Setting up a new business brings with it a host of stresses and strains. Entrepreneurs share the concerns that kept them awake in the early days and how they turned those fears into opportunities.
Recent research has found that 76% of SME owners lose sleep over the state of their business.
According to the research by Opus Energy, just over a third (35%) tossed and turned over their company finances and costs, 27% remained wide-eyed over their work-life balance and a quarter fretted about how best to attract customers.
To address their worries, many owners are working seven days a week. But there are more positive ways to cope.
Shazia Mustafa created her co-working/nursery space Third Door nine years ago and describes the first two years as “painful”. One of the trickiest areas was hiring the right staff for the nursery so that parents using the space could work more flexible hours.
“We originally outsourced the hiring but our supplier didn’t understand the flexibility we were offering,” she says. “I came from a corporate background where you worked until you got the job done but I knew that working in childcare is very different. I quickly realised nursery staff only work their contracted hours, and rightly so. This meant I needed to adjust to a new way of thinking. Since then I’ve worked hard to implement tools and procedures that have ensured the team do not need to work beyond their working hours, such as evenings or weekends.
“I ended up doing a childcare qualification and training our staff in values such as respect for the children. It’s less stressful now.”
For Peter Browning, founder of PB Supercar Hire, the biggest headache was arranging insurance for the business. “Insurance for a fleet of £100,000 supercars is not something you arrange in five minutes on a comparison site,” he says.
“However, I hadn’t anticipated the level of scrutiny required. It took over four months of meetings with underwriters who looked into my personal background and asked to see a certified wealth statement. This was before they even looked at the business model.”
Added to the stress was purchasing new premises and putting down car deposits. “There was a chance insurance wouldn’t be issued, putting an end to the business before it had even started. A valuable lesson I took was not to assume anything when setting up a business and always get details confirmed in writing before you commit to any expense,” he says.
Ed Reeves, co-founder of office outsourcing service Moneypenny, recalls being uneasy about investing in a new software system to capture data. “It was either develop our own or buy existing software,” he says. “We went our own way but it turned into a bit of a nightmare because it took ages and cost more than we had planned. In the end the stress was well worth it because we have our own proprietary system, and we’ve been able to keep it at the forefront of technology.”
Managing employee relationships is also a chief concern. “Staff disagreements really sap your energy,” says Colin Hewitt, founder of software start-up Float. “You must tackle these disputes when they’re small, such as pointing out to someone that you always wash up their dirty coffee mug. We’ve created a ‘clearing team’ where disgruntlements can be tackled and managed.”
“The less I worried about what wasn’t in our control and the more I focused on what was – such as our core work with clients – the better I felt”
Reeves recalls the worry of moving to a new office in 2016. “I was really concerned about how we were going to create a place staff would love coming to every day,” he says. “I realised the best answer was not to worry but to ask our staff. We now have our own village pub and treehouse meeting room. What could have been a huge headache turned into a fantastic opportunity.”
Mustafa says that when she started Third Door, few people understood the concept of a flexible working space and working nursery under one roof.
“We had to educate potential customers about exactly what we were offering,” she says. “We did a lot of marketing and were helped by word of mouth, but it’s only been recently where people have come looking for us. That’s because flexible working has grown in popularity.”
David Carry, chief executive of business coaching firm Track Record, says his main start-up fear was late payers. “We hadn’t anticipated the length of time it takes to get paid, up to 90 days. That’s difficult,” he says.
Instead of negotiating these terms down, Carry decided the best solution was planning. “Once we knew this was the situation, we just planned our expenses and overheads around it. In fact, the less I worried about what wasn’t in our control and the more I focused on what was – such as our core work with clients – the better I felt,” he says.
Hewitt also struggled with cash flow. “Running a web design company, I was always thinking about whether I was going to make the payroll each month,” he says. “We had a healthy number of clients but there’s always that gap and uncertainty over when the money is going to come in. I used to print out all the owed invoices and put them on a pile on my desk. One gust of wind and they would all have gone.”
Hewitt solved this by creating his own accounting app. “At first we had a spreadsheet with a list of invoices, bills, budgets and VAT payments to help us manage it better. We created an app based on it and that turned into Float.”
Too much work coming in sounds perfect, but it can stretch resources. “My biggest worry was a lot of work just falling on me,” says Mike Ellis, owner of digital marketing firm 43 Clicks North. “People came out of the woodwork telling me that they’d love me do this or that piece of work.
“It was nice but I got worried about how to do it all and keep the level of quality high. I became much more sensitive about my work than I had ever been before. But it led to me creating new jobs. I hired an apprentice who did lots of administrative tasks, digital marketing and new client onboarding and a more experienced colleague to help with the increasing workload.”
“I often run events and lie awake fretting that not a single person is going to turn up,” says James Shoemark, founder of coaching group The Startup Race.
“I’ve got the guest speakers and the venue and all the moving parts arranged and I feel this tremendous responsibility to actually get clients through the door. But it makes me get my act together, keep promoting and improving my selling. You make it a positive motivation.”
How not to lose sleep over common business worries
Money matters: use technology to keep abreast of what’s going in and out of the business. Have a system of chasing late payers or look for solutions such as invoice financing.
Staffing: set out a values framework to judge candidates by. Will they fit into your vision and share your work ethics? Be careful, however, not to choose ‘mini-mes’, look for people who will also challenge your thinking and strengthen your weak points.
Management: disputes between staff and disgruntled employees can batter productivity and performance. Have systems in place such as regular reviews, opportunity for feedback and perks/benefits.
Gaining customers: do people understand your business? Do they know you exist? Marketing both face-to-face and online is vital, as is developing your brand.
Work-life balance: Don’t work so hard that you never see your family or friends. Taking time off to relax and think of things other than your business will improve motivation, health and confidence.Published: 07 February 2019 Updated: 23 May 2019