DETROIT – Starting a new business can be both exciting and daunting. You’re ready to turn your idea into reality. At the same time, it’s normal to worry about the possibility of failure.
Leading your business to success comes with many challenges. It takes patience, planning, perseverance, and arduous work. Although there’s no single correct path to success, there are some useful pieces of information that can help you grow your business.
Below you’ll find the top five tips every new entrepreneur should know when starting their business.
Create a simple business plan and expand it over time
A business plan is a document that details your business’ goals, how you plan to reach those goals, and a period in which to reach them. It also includes things like financial strategy, marketing strategies, and other relevant topics.
For example, imagine you were starting a drywall installation business. Your business plan may include goals like ‘Increase profits by 10% in one year.’ The plan may also describe how you achieve efficient administration, which, in turn, helps improve your customer satisfaction and market competitiveness. Coming up with these strategies can be made easier with help from an industry-specific application, like Jobber.
In general, around half of new businesses fail by their fifth year. Out of the remaining businesses, roughly 70% of them follow business plans. Coming up with a solid plan undoubtedly increases the likelihood of success. (1)
Try to start with a simple business plan and add to it as your business grows. If something doesn’t go according to your plan, don’t let yourself be discouraged. Use it as a learning opportunity and adapt your plan accordingly.
Also known as market analysis, this is all about analyzing and understanding your competitors and customers. It informs customer engagement, marketing strategy, and other business decisions. Market analysis is essential if you aim to position yourself as a strong competitor in your market.
Making sales is about knowing who your customers are, what they need, and offering them a quality service/product that satisfies that need. Identifying the ideal target audience for your services is one of the most critical steps to growing a successful business. Additionally, your competitors will be doing everything possible to attract customers to them instead of you, so you need to discover what’ll make you stand out.
Think back to the drywall business example. Perhaps evaluating the market revealed that most competitors tend to have inconsistent, unreliable initial quotes and final invoices, leaving customers feeling frustrated. Your business could maintain the desired consistency with your reliable drywall invoice template.
Learn how to manage business finances
You might be an expert when it comes to your business’s products and services, but that’s only part of the bigger entity. Much of business revolves around managing finances. Not being in control of your accounting is one of the worst mistakes any new entrepreneur can make.
Research has found that 81% of small business owners manage finances themselves. Additionally, 40% aren’t confident in their financial management skills. Managing business finance yourself is rarely a good idea if you sit within this group as it can put you under a lot of pressure. Plus, if you’re not comfortable handling finances, it could strain the business and distract you from other important tasks. (2)
Poor financial and cash flow management leads to 82% of business failures. If you want to succeed, try to either invest in educating yourself on the topic or hiring someone to manage it for you. (3)
You can’t attract customers if they don’t know you exist. A successful marketing strategy is how you build your credibility, brand recognition, and bring customers to your door. There are many strategies you can try, and you’ll probably try a few before you find what works best.
That said, digital marketing is currently one of the most effective marketing strategies. It’s cost-effective, reaches a large audience, and is easy to adapt. Within the scope of digital marketing, you might try social media marketing, marketing with affiliates, or even email listing.
Have a passion for your business
Starting a business is difficult, but keeping it going is even more challenging. You’ll probably need to make sacrifices, put in extra hours, and work another job to support yourself before the business takes off.
Having a passion for your business and what you’re doing can make it easier to put in all that effort. It doesn’t necessarily mean you must love your product or every aspect of your business. However, true dedication and to growing your venture into a success will help you achieve your goals.
Grab your dreams with both hands and hold on tight, because they won’t come easily. Starting a new business demands lots of time and effort. That, alongside proper planning, elaborate research, and a strong passion for what you do will help you and your business along the path to success.
- “A business plan creates 30% greater chance of growth – Excellent Business Plans”, Source: https://excellentbusinessplans.com/a-business-plan-creates-30-greater-chance-of-growth/
- “The Truth About Financial Literacy & Small Business Owners | CPA Practice Advisor”, Source: https://www.cpapracticeadvisor.com/small-business/news/12340810/the-truth-about-financial-literacy-small-business-owners
- “Cash Flow: The Reason 82% of Small Businesses Fail – Preferred CFO”, Source: https://preferredcfo.com/cash-flow-reason-small-businesses-fail/
This is a guest column.