A Harvard Business Review study from 1983 lays out the five basic stages of small business growth. Although nearly three decades have passed since the study was published, the findings of its authors still ring true today. Consider these five stages and where your business may be:

1. Existence – In the beginning, there was a beginning. At the early stages of a small business’ life, its owners are out searching for customers and nailing down how they’ll deliver their products and services. In this stage, the business’ viability is proven, based usually on factors such as the owners’ capital, their ability to generate sufficient sales revenue and finding the right products and services to offer. If business owners can successfully answer these basic challenges, the business will move to the second stage of business.

2. Survival. Businesses that make it to this stage will have proven the basic viability of their business and will be up and running, generating revenue. At this point, owners will be in theprocess of determining whether they can keep revenues high enough and expenses low enough to get to a break-even point and later prosperity. Long term growth issues will also begin to be addressed in this stage.

3. Success. At this point, the business has become economically healthy, generating a comfortable profit margin. Business owners who have reached this point will likely begin asking themselves whether they want to expand the business or allow it to continue at its present level. Owners may also become less involved with the day-to-day operation of the business at this point, having created a command structure reliable enough to allow them to reduce their involvement and enjoy a steady income from the business with little intervention necessary on their part.

4. Growth. Business owners who decide to grow their business further at stage 3 advance to this stage. Owners are still involved in the business, and important decisions about new markets, debt burdens and competition with other businesses becomes a major focus at this stage. Another key issue is delegating more authority to a management team and structuring the management team.

5. Maturity. At this point, the business has grown and continues to make plans to continue to grow. The business may not be very identifiable with the original business at this point, as the owners may have divested their interest in the company and the business may be offering products and services far different from their original line up. A major issue for businesses in this stage is preventing stagnation in terms of innovation and the ability to react to changing business environments. Mature businesses often create a complacent corporate culture where boat-rocking and change are resisted, making them less able to adapt to changing circumstances.

By recognizing the growth stages of small business, entrepreneurs can better focus on the issues they need to be paying attention to, and better plan for their future and that of their company.

The ability and willingness to assess and successfully avoid or mitigate risk is what separates entrepreneurs from employees.

All businesses come with some level of risk, whether that risk is fluctuating prices, dependence on seasonal sales, a potentially dangerous work environment or a lawsuit-prone industry.  Finding ways to limit your business’ exposure to risk, while also taking the calculated chances necessary to grow and prosper is key to being a successful businessperson.

Business owners have a variety of ways they can hedge against risk, including training, insurance and contingency planning. Being aware of each of these hedges and determining how best to use them is key to allowing you to take risks in business while also preserving the business if you make the wrong call.

Identifying risk

In general, there are three types of risk to a business, hazard based risks, uncertainty based risks and opportunity based risks.

Opportunity based risks are essentially the risks any business owner takes in taking or declining an opportunity, such as rolling out a new product, declining an offer or expanding payroll or locations, etc.  Opportunity based risks can be subtle, they are often financial in nature and can be hard to spot.

Opportunity based risk can be the most difficult form of risk to manage, and the ability to identify the right risks to take and the ones to avoid are what separates the Steve Jobs of the world from the just Steves. One way you can better weigh the risks involved with taking or passing up an opportunity is to do your homework. When presented with an opportunity, look at all the angles. Consider the potential upsides of the opportunity, and the financial condition of your business. Look at what your competitors are or aren’t doing. Also weigh what can go wrong, and determine whether and how your business would survive if the opportunity turns into a disaster.

Hazard based risks are risks associated with sources of potential harm or situations that may cause harm to employees, customers or the general public. These can include workplace hazards, chemical or biological hazards or psychological hazards such as workplace bullying or harassment. Hazard based risks can be reduced by careful attention to sources of potential hazard and training and policies to help cut their chances of occurring and mitigating the impact if they do occur. Insurance can also insulate your business financially from hazard based risks.

Uncertainty based risks are risks that occur as a result of unexpected events, such as natural disasters, regulatory changes, emergence of new competitors, loss of suppliers or customers, etc. Uncertainty based risks, are by nature, tough to predict and plan for, but there are a few ways you can reduce your risk such as insurance policies, frequent examination of data and a business continuity plan that details how your company will operate in the event of a disaster that puts your out of your physical location.

Insurance policies

Perhaps one of the best hedges against risk you can have in your small business is an insurance policy. Insurers provide a number of policies to provide you and your business with protection from incidents or claims that may arise in the course of your business.

Insurers can provide coverage for a number of potential risks:

General liability insurance – This type of insurance will provide coverage for claims that arise from injury to third parties (customers, vendors, etc.) and usually will cover damages to property and bodily injury. This coverage will also fund a legal defense for your company.

Commercial property insurance – This insurance provides coverage to your business property, providing coverage for property losses that occur as a result of covered occurrences as defined by your policy. An example may be coverage for potential damage to a construction company’s building equipment.

Business interruption insurance – This insurance can make sure that you continue to have revenue in case your business is unable to operate because of a natural disaster, civil unrest or other covered occurrence.

Professional liability insurance – This provides coverage for services offered by business. For example, a doctor or attorney may have professional liability insurance to offer protection from malpractice claims. This form of insurance is also known as errors and omissions insurance.

Cover Your Bases

Small businesses can help reduce their potential for losses by making sure their physical locations are safe and in compliance with state and local regulations. When starting a business, inquire about the safety regulations for your particular industry and make sure that your facilities comply with laws regarding public and employee safety. You may also want to consult trade groups within your sector to see if any other measures are becoming industry-standard.

When considering a new business opportunity, be sure to look over your financials and do as much market and other relevant research as you can to get a clear picture of the opportunity and its potential downsides. When entering into a contract with another business or customer, make sure you understand every aspect of the contract, from deliverables to cancellation clauses.

Proper Training

Having a properly trained staff can help head off many of the risks involved in employing others. Employees should receive safety training appropriate to their jobs, so you can comply with government regulations regarding employee safety in your industry, and so employees will know how to minimize harm to themselves and the company in the event of an incident.

For employees who deal with sensitive information and material, providing training in document retention and destruction is important to preventing claims related to identity theft or data loss. It’s also important to provide employees with training in ethics and laws pertaining to their work, so they can avoid unknowingly engaging in illegal behavior that can give rise to a claim or penalty.

Providing your employees with sexual harassment and discrimination avoidance training can help them avoid engaging in behavior that could give rise to a claim. It also helps shield you from lawsuits accusing you of failing to adequately train employees to refrain from such behavior and can act as a mitigating factor if a claim against you is successful, helping to limit damages assessed against your company.

Limitations of Risk Management

Even the best laid plans cannot account for and mitigate all risks. And excessive aversion to risk can paralyze a company in excessive bureaucracy and fear to act. When making your risk management decisions, severely limit the no-brainer risks (keeping a safe workplace, discouraging sexual harassment, etc.) while taking appropriate, reasonable action to reduce the potential for damage from more complicated risks such as decisions to add new products or open new stores.

It is much simpler to file your taxes if you are registered as a sole proprietorship. The amount of money that will be required of you to create a business will also not be as high as if you were creating a corporation. You will also not have to worry about one day being forced out of your company by someone else who was able to buy a controlling portion.

The main negative of having a sole proprietorship is that you are liable for everything that happens to the business. That means if someone were to hurt them self at your business, you will be personally responsible. It will also be harder for you to raise funds after you initially start your business. If you believe that your company will need to grow substantially in the next few years, a sole proprietorship would not be the best choice. There is also the restriction on the name of your business should you live in one of the states that require you to name your business after yourself.

A partnership is when you and another person go into business for yourselves. This partner can be a single person or can be multiple people doing business under one name. The advantage of having a partnership is that you are able to raise the amount of capital you have by adding their capital to your own. This will help when it comes to bank loans. You are also able to have someone else to help you should you need help in deciding how to run a business.

The disadvantage to having a partnership is that you are not the only one who is in control of your business. The person who you entered into an agreement with is now able to have a voice in deciding what happens within the business. Some people who invest into companies prefer to keep as “silent partners” and only collecting from the profits of the business. One way to keep this situation in balance is to draw up a partnership proposal and figure out with the partner who much or how little involvement they are going to have in the business. This will likely require legal consult so that there is no disagreement about this in the future. Many people have made partnerships work so it should not be discouraged.

The last main type of business is the corporation. You may be confused about S-Corporation and C-Corporation. The main difference between these two is that for an S-Corp, you only have to pay taxes on your salary while in a C-Corp you will pay taxes on your salary plus corporate taxes on your profits. In a C-Corp though, you are able to sell more stock for your company than an S-Corp. Unless you are a large company, it would probably be better to go as an S-Corp.

When you create a company, another entity is formed. The company is different from you. Where as in a sole proprietorship you were liable for any damage that were to occur, when you have a company, the company is liable for the damage. In an S-Corp you are still liable for your own actions within the company. You will also sell stock of your company now in order to raise money. This means that you will need to arrange stockholder’s meetings to discuss the logistics of what happened to the company during the year.

A company is more easily able to raise money as well as market its product to the public. When you sell the stock in your company, you will receive money for every stock that you sell so that you can reinvest that money into your company. You will have to share the profits at the end of the year, but with the money you receive from people buying into your company you will be able to expand easier without having to use your personal money or to take out a loan with a bank.

You may also want to investigate having an LLC or Limited Liability Corporation. This structure essentially combines aspects of a partnership with a corporation. However, there is no partner or shareholder, only members. The corporation is its own entity still but the profits and losses are reflected in your own personal taxes. You do not need to have meetings with other members though. There is not even a requirement to have more than one member. You only need to file Articles of Organization with your state to operate. LLCs are considered relatively new since they were only introduced into the structure system in the 1990s.

There are many different ways that people can choose to run their business. It’s more than just a name, there are many advantages and disadvantages when it comes to choosing how you want to run your business.

Benefits of women oriented businesses that are based from homes

This form of business is ideal for a woman who is entering into the business arena for the first time. With the help of businesses that are conducted from homes the woman will get a taste of the mannerisms of business and once she is well versed with it she will be more competent to enter the real business world. They will also learn the ways of marketing and do’s and don’ts of business. Another big advantage is the fact that a home business will help them in their multi-tasking nature of being a home-maker and a business woman because then she will be able to work according to her own convenience.

Options for women with particular talents

There are many ideas that are available for women who want to do business from homes. The best option is to write. If the woman is someone who has a flair for writing then this is the best option that is available for her. These days there are many opportunities of writing that are available which range from writing for articles, content of a particular topic or even writing out resume for people. If one is good cook then maybe catering is also an option. One can start with cooking at home and then slowly when the business catches on can decide to move out. Teaching yoga can also be an option that can be en-cashed. If a woman is trained in the field then she can train from home and earn decent money for it.  There are also options like planning of weddings and gardening for women to take up depending on their interests and expertise.

Strategies for success

When starting any business one must be completely dedicated to it and only then will one be a successful business woman. One must also see to it that one is trained in the particular field failing which the business can be completely ruined and then returning to any business will be next to impossible. Also since it is businesses to be done from home one must be still equally dedicated and sincere in the work. This article mentions many ideas that are available for women to work from home and one must choose the one that interests them the most. There are many online and offline resources that help you to access great training workshops to hone ingrained skill. It pays to make the investment since the returns are higher than any real time 9 to 5 option around.

Women make great entrepreneurs. There is no dearth of pursuits that allow you to make a fast buck. It is imperative though, to find the right resource and take guidance from the right mentor. There is a huge market for just about any creative idea in the modern world. Human ingenuity is being valued more than every before. To this end women make a great mark on the business world, driving home some really creative ideas. They are entrepreneurs with a soul and are very sensitive to the needs of society. You can now take a look at millions of home based and corporate ideas for small business set-ups for women in the internet. The resources are helpful with ongoing support and advice that comes from established women entrepreneurs and internet business gurus.

A number of women today are also capitalizing on their baby sitting skills and with a little help from a support team you have a business set up! It works out o your advantage to let people in the vicinity know your talent. It is only by advertising your skills that you reach the target audiences. If you have the funds in hand it is also a good idea to tap potential via the internet connectivity at home. Interestingly even your proficiency in games can earn you big time! Did you know that a number of women are also forwarding their bingo and poker skills for a fee!

Ideas for small businesses

The biggest idea for small businesses is the business related to the Internet. E-commerce has definitely caught up and therefore more people are getting employed by it. There are also some ideas that are based on people’s own interests and fields of expertise. Some of then are day care business wherein people who are fond of children opt to take care of them when their parents are away at work. In fact parents prefer to drop their children at homes of individuals rather than day care centers. Another option is to take care of pets for people who love pets and do no prefer to take the responsibility of caring for kids. One other option is to sell things that are lying around in the house without being used. Also if one is good at art and at making of things of art then may be one can make things and sell it through and exhibition.

Other options

Apart from the above mentioned options there are also some other options like cleaning the homes of people who have no time to get it done on their own. This sort of work only requires a commitment of once a week and with a good customer base one can do good business. You can also act as a delivery person and help in the delivery of things from one place to another in the same locality and earn a sum of money for it. One can also help in cutting of the grass or in the removing of the snow from the houses of the locality and get paid for it. Another option is the making of useful things out of scrap and waste materials. One can either start an own set-up for making things or can also become a consultant to people who are not aware of what to do with the scarp materials that they have.

It is good to indulge in by word of mouth publicity and social networking. It pays good dividend to let people know you are around to handle a particular task. You can bank on any kind of talent. If you are good at designing and developing content, the online content development required by dedicated SEO companies is a good way of earning a lucrative salary. Similarly you can take catering for special events, gift wrapping, financial planning and home decoration ideas to a whole new level. Men and women are now indulging in good passive income sources. This means that they keep their regular jobs and simply use their spare time in the evenings, night or mornings to generate the side income. Becoming a small business entrepreneur is really intent away.

You can capitalize on your skills and many a times also use your main earning avenue to generate the side business opportunity. For example, if you are a teacher by profession, contributing to special text inclusions and redesigning texts for students with special needs generates royalty for life! Another good example is blogging and making the most out of ad-sense. It helps a lot on the monetary front to increase your income at a time when your energies permit. The ideas are all out there, all you need to do is tap the right resource. There are many people who also share strategies and tips on the setting up of small businesses. You can consider these and the space available and delve into some fantabulous small business propositions like starting your own courier business and using attic space as a storage pod for people on the move.

With a little creativity all your monetary woes can be sorted. Take time off to scout around and indulge in some good self analysis. Weigh your strengths and weaknesses and look at the resources already at hand. There is nothing like getting your own business kick started now to leave back a legacy and heirloom for future generations. Who knows the kind of success and popularity you could enjoy on an international rostrum with frugal resources!