Starting a business is a nerve-wracking process. It is one thing to have an incredibly creative idea and daydream about turning it into a successful business but going through with the process can be exhausting. Statistics reveal that there are approximately 32.5 million small businesses in the US. Small businesses generate 1.5 million jobs annually and are an incredibly important part of the economy.
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Data reveals that nearly 20% of small businesses fail in the very first year whereas half of the startups will fail within the first five years. This is a considerably large percentage. What are they doing wrong?
Here are a few golden rules for new business owners to put you on the path to success.
Pay Attention to Your Counterparts
One of the biggest mistakes that new businesses make is not keeping track of their competition. It is important to stay aware of your surroundings and learn from the competition. Analyzing your competition and finding out their strengths will provide a learning experience for you.
Similarly, by finding out their weaknesses you can figure out the blind spots of the market so you can make strides in that direction and attract consumers.
Prepare a Good Business Plan
A business plan provides you with a clear vision for your startup. Initially, people are fueled by passion and excitement for the new project and do not feel the need for an official business plan. However, as things move along, they start to encounter problems and feel lost.
A business plan saves you from feeling lost along the way. It does not have to be a scary and extensive document. It just needs to identify the target market, the product you plan to sell, your pricing plan, and have a record of your business savings and expenditures. It can allow you to make changes to how you pursue your business to deal with any problems that arise along the way.
There is no shame in asking people who have years of experience for advice. Running a business is a stressful job and at times, the right advice at the right time can help you make an excellent decision. Surround yourself with people with experience in running a business and network with fellow business owners as it can help improve communication and put forward different perspectives for you to consider.
Pay Attention to Marketing
New business owners often do not leverage the strength of marketing in promoting their business as well as they should. It is great to have an excellent product that adds value but marketing it to the audience is equally important. Employ an effective marketing strategy, as it is imperative for the success of a business.
It is important to make the relationships with your consumer and your employees the priority. Prominent Author Randy Ross has argued about how good businesses are created by prioritizing human relationships in his literary work. Healthy relationships with customers and employees are the key to organizational success. Prioritizing relationships can help maintain consistency and inspire people to perform better ultimately leading to success.
Aim to Create Value
With nearly 64% of all new jobs, being created by new businesses, startups and small businesses are important economic growth drivers. Many individuals start their businesses but as discussed earlier most of them fail. There is nothing wrong with starting a business motivated by the passion of being your boss.
However, for it to be successful there needs to be value created for the consumer. There should be innovation and novelty in either your product or the way you market it. Otherwise, nothing would persuade the customer to pick you over the dozens of already available options.
Do not be discouraged by the rate of business failure or the challenges a new business faces. If you have a good idea and the motivation to pursue it, you will figure out all challenges that come your way. Keep these rules close to your heart and your business will be on the path to success.