Six things every entrepreneur needs to do
Want to grow a successful and profitable business (and avoid being one of the 80% that fail within 18 months)? Here are six things you need to do.
The number of small businesses launching are on the rise. According to LinkedIn, the number of entrepreneurs in the UK increased by 6.4% between 2016 and 2017.
But while more of us are starting new businesses, the survival rates of these enterprises remains painfully low: 8 out of 10 entrepreneurs who start businesses will fail within the first 18 months.
So how can you ensure that you’re in the top 20% of entrepreneurs who make it? Certainly persistence, energy and resilience will go a long way towards succeeding. But there’s more to running a business than simply being enthusiastic and being able to take the inevitable knocks.
Six things every entrepreneur needs to do
To help you buck the trend of small business failure, here are six things we recommend every entrepreneur does.
1) Build relationships
A strong support system will help you weather most storms – whether it’s by offering practical support, advice and connections, or giving you strength, encouragement and kinship. (This is one of the reasons why our own supportive Facebook group is so popular.)
If you don’t already have a support system, get to know other small business owners and form a team. Commit to teaching and learning from each other – and supporting each other through the ups and downs of entrepreneurship.
2) Crunch the numbers
How can you build a financially profitable business if you don’t know your numbers? If you don’t know how much is coming in and going out every month? And if you don’t know exactly how much it costs to produce and deliver your products and services?
You also need to be aware your your tax obligations, and seek out any small business tax deductions that may help to you save money.
And finally, it’s basic – but important advice: save all receipts for items that you purchase for business use. Computers, home office furniture, and even your internet costs can be deducted. (We recommend speaking to a tax professional to make sure your taxes are done properly.)
So you have a wonderful product or service that’s priced competitively. You know you’re the best on the market, but why aren’t people buying?
The chances are it’s because you haven’t got your marketing right.
Too many small businesses assume that customers will seek them out and decide to buy without any help. But they won’t. Customers need to hear from you from somewhere or someone. And they need time, and interaction with your marketing messages, to make the decision to buy from you.
So if you haven’t done so already, understand your customers’ buying process, and ensure you’re advertising in the right places, at the right time, with the right messages.
4) Try something new
So you’ve got your marketing and advertising right and have built a solid customer base. You can relax now, right?
Wrong. If you want your business to remain successful relevant, let alone grow, you need to be continually evaluating and innovating. And this means trying new marketing tactics, and thinking of new ways you can deliver value to your existing customers, as well as reach new ones.
You need new products and services to up and cross sell to your existing customers as well as attract a new target audience. And you need to look at ways to expand your offering to ensure that, if suddenly things stop working – a product becomes outdated or sales suddenly drop off – you haven’t left all your eggs in one basket.
5) Invest in yourself
No one is born an entrepreneur. We learn how to be one though experience (and often expensive lessons!). But experience can only teach us so much. At some point we need to recognise that we need to increase our skill set to ensure we’re the entrepreneur our business needs.
Education can also stop us making too many expensive mistakes. It can save us time, and even open up new business opportunities (and profit) to us.
So don’t be afraid of investing in yourself. After all, every business is only as good as the person leading it. If you invest in yourself, that investment should trickle down through your business.
Exactly what kind of training you may need will be entirely dependent on you and your business. But as a basic, learning key skills you can’t afford to outsource yet (such as social media and marketing) can often make a big difference to your business – and confidence.
And coaching or mentoring is always a wise investment that should deliver a healthy ROI if you find the right coach or mentor.
6) Listen to your customers
It’s not easy to take criticism. But if you want your business to be the best it can be, and to keep your customers happy (and returning), you need to ask what they think of your products or service.
If you can, create a space on your website for customer reviews and experiences. Check it regularly to see what they like and what they want to be changed, and take action accordingly. Also don’t be afraid to address any negative comments on social media – if you handle a complaint well you can even convert an unhappy customer into your most loyal fan.
Of course, it’s also important to acknowledge any positive feedback too. Thank people for their kind words, and capture them as social proof. Few marketing strategies are more powerful than sharing what other customers think of your business.