Are you an owner of a small business enterprise? Or are you thinking about becoming a fresh entrepreneur with a startup project of your own? If either of these two is the case, then there are a couple of things that you must learn before you continue with your plans. There are many numbers showing that 90 % of small businesses fail during their first five years of operating.
In my humble opinion, this number is too high, but I know that it’s not far from the truth. The sad part is the fact that most of these businesses fail because the people running them are not prepared for the things that await, and their demise is caused due to their negligence. On the bright side, with a mix of good ingredients and a dose of hard work, you can easily be a part of those 10 % of businesses that achieve success.
Think of the whole thing as if you were cooking a meal. If all the right ingredients aren’t in place, your food won’t taste as well as it should, and trust me, these recipes are very tasty. The same rules apply for setting up a business. Although there are different kinds of businesses out there, there are certain things that they all have in common. Here are the 10 most important ingredients your business recipe should have.
1. Unique services and products
The first thing that you need to have is something you can offer to customers. Regardless of whether you plan on offering services or products, this is the most vital element of any business. The best and most natural way to go would be to offer something you know you can do better than anybody else, and something you’re passionate about and enjoy doing/producing.
Starting a business organization just for the sake of running a business is a particularly ineffective way of doing things, and you won’t be able to provide something that’s different than what the rest of the crowd is offering as long as you don’t have the necessary knowledge about those services or products.
It’s quite obvious when a company doesn’t understand its audience and the niche in general, and it won’t be long before customers find that out as well. If you have an idea that has value, but don’t know anything about it, there are three courses of action you can take:
– Learn more about certain products/services
– Forget about that idea and come up with a new one
– Find a partner that has the relevant knowledge to offer exceptional products or services
Remember, it’s all about being both good and different, so take care not to rush this step.
2. Create a business plan
Each and every established business organization, no matter how small or large it may be, has started with a good business plan. By writing a business plan, you will be able to outline strategies, goals and directions that you will use to achieve them. If you don’t have a concise plan and a clear path for moving forward, you can easily lose track of of where you are and where you are headed.
When you create your business plan, try to stick to it as much as possible. A business plan will also keep your employees in line, and they won’t stray from their duties when they know what the ultimate goal of your business is. Furthermore, you can include your business norms and policies into your business plan, so that all of your employees are on the same page.
Running a business is serious business (pun intended). Being an entrepreneur and running a business organization is much, much different than working for somebody else or being a manager in someone else’s company. When you are the leader of a business, everything that affects your organization affects you as well. And, if you are a typical business owner, you are probably putting all of your energy into running and improving your organization.
This is why things can get pretty stressful, and you can easily reach the point when you ask yourself whether the whole thing is even worth the trouble. Being the guy or gal in charge can get overwhelming, especially during the early years. Trust me, it’s quite worth it, but this is where your desire and determination need to shine.
Having a passion for what you do and enjoying can also be quite helpful for motivating yourself. This is yet another reason why you should look to build your business around something you’re passionate about. If you enjoy your work, even the worst days won’t seem that bad and losing your resolve is highly unlikely.
4. Online presence/website
I cannot even begin to explain the importance of this particular ingredient. In the modern business market, no matter what industry we are talking about, not having a web presence of your own is like not having a smartphone. More and more, the success of a company’s online marketing will directly affect its overall success. A business website is a must, period.
Still, just having a website is not enough. You need to have other channels on the web through which you can spread your influence and improve brand awareness. It is important to have social networks that are relevant to your business. All of your profiles, including your website, should be informative, professional, clear and appealing. If your site doesn’t have all of these things, you will lose a lot of potential clients.
The majority of modern business organizations understand the value of having an impressive web presence, hence there are a lot of competitive websites. This is why nobody will stick around trying to figure out your site when he or she can find another similar business in a matter of seconds. Make sure that you find a responsive website company that can make your website highly functional and user-friendly.
5. Create a solid customer base
Naturally, if your business has no customers, you won’t make any sales either. Find your target audience, through which you can built your customer base and hit them as hard as you can.
If you run an interior design company, your target audience should be respectable home owners and home buyers. People who don’t have their own living space should not be your focus group. It is very important to know your potential customers. By having this information it will be much easier to give them what they want, and increase the number of services or products by including follow up services.
The best places to find your audience and get them interested in your business are social networks. The important thing is to recognize what social network suits you the most. For example, if you are planning on starting a women’s clothing line, you should focus on Pinterest.
The majority of Pinterest users are women and it’s an image-based social network that is perfect for “pinning” (sharing) photos of your products to the fashion lover crowd.
6. Marketing and advertising
Your business can have the best products and website in the world, but they won’t do you any good if people don’t know about you and can’t see what you and your products are all about. Any business that wants to succeed needs to have some sort of marketing or advertising strategy. The best way (in my opinion) is to have a strong online marketing campaign.
The majority of small businesses don’t have that much money and other resources to spend on their advertising. Luckily, there are many options that you can use to advertise for a minimal cost or free of charge. There are various types of digital marketing, including content marketing, social media marketing, banner advertising, email marketing, etc.
Try various different techniques and see what suits your business the most. Track your results and test different approaches to find the best formula and avoid spending money on marketing campaigns that are not effective. Once you start getting some revenue, you should definitively look to include a larger advertising budget and incorporate it into your business plan.
7. Improve your customer service
No matter how large your customer base is at the moment, the majority of them will leave if you don’t tend to their needs. Once they are gone, it will be hard to get them back. What’s even worse is that the bad news will spread quickly and those people who haven’t been satisfied with your services will encourage others not to have anything to do with your business. Bear in mind that you have the competition that’s just waiting for you to slip up.
Your customer service can be the thing that causes someone to buy from you, instead of going to somebody else. You must make each and every customer feel like he or she is your only customer. Make your customers feel important and special. Answer all of the calls and emails and give people your undivided attention.
8. Employees are important
No entrepreneur can run a business all by himself; it’s simply impossible. This is a fact you need to remember and it is essential that your business is run professionally.
It’s easy for small business owners, and especially those who are based in their home, to forget that they are in fact running a business organization and not just doing a hobby. The first thing you need to do is establish your working hours and make sure that you and your employees alike stick to them with the utmost discipline.
The second thing you must consider is what kind of people you should hire to work for you. The best way to determine who is suitable to be your employee (apart from their knowledge and expertise) is to see how their personality and work ethics may fit or not fit in with your business model and with your company’s core values.
9. Finance and accounting
All businesses need to have systems and methods for handling their financial affairs. You must create a process that helps you receive and disburse money. If you have a business website (and you must, like we said before) it means that you will have to accept credit cards, as well. If you plan on having or already have and affiliate program, it is important to come up with ways for paying all of your affiliates.
The calculation should also include paying your employees, vendors and other people whose services you’ve hired. You always have to make sure that you have enough money to pay your employees and the necessary bills, before you can think about investing in something else.
A lot of businesses fail because they get into trouble for not paying taxes, and when the interest rises, money becomes an issue. When hiring an accountant, be absolutely sure that it’s someone trustworthy, so that you don’t get in trouble because of bad accounting.
This is one of the most crucial ingredients that you cannot overlook. There are many lawsuits running rampant today, and with the internet growing larger, all of the legal issues are becoming more complex. Every day, a number of businesses close down because of legal issues.
No business in the world wants to be handed a law suit, especially a small one, since they can’t survive law suits. Even if you’re not found guilty, you will still have to pay lawyer’s fees and most small businesses are on such tight budgets that they can’t afford this.
You will have to register your company and hire an attorney to help you with all of your paperwork and anything else that requires legal knowledge. It can be hard to find a reliable attorney for a fair price. The best way is to find a family friend or someone you’re acquainted with to help you with legal issues.
Running a business is not easy, but it’s not that difficult either. The success of your business depends primarily on you. Make sure that you utilize on these 10 ingredients and you will have much better chances of advancing as a company.
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