There are a variety of reasons whey small businesses fail. After working with hundreds of small business through the years here are a few that RISE TO THE TOP.
NO MARKETING PLAN
NO MARKETING CAMPAIGNS
NOT TESTING MARKETING EFFORTS
NOT MEASURING MARKETING EFFORTS
Too many business owners look at marketing as an EXPENSE when it's actually one of the best INVESTMENTS you can make for your business!
You can't open the doors of your business and expect customers to find you. I have seen businesses spend tens of thousands of dollars on a new retail location and/or to build a new shinny website and then EXPECT customers to find them. You can have the best website in the world but if no one knows about it or can't find it how will increase sales?
ATTENTION ALL BUSINESS OWNERS!
Marketing is ONLY a Expense if you are doing it incorrectly! Maintain active marketing campaigns and make sure you can MEASURE all of your marketing efforts. Don't just throw money at your marketing and think its going to work itself out. Test your marketing and advertising and measure everything. Large corporations can afford to throw money at marketing they can't measure but most small businesses can't afford this.
Successful businesses only risk a small amount in testing an idea with a high potential return .... e.g. adwords to get traffic to a squeeze page or survey .... then only do they create the product if the test indicates it is profitable else they fail quickly. They only take major risks like renting a shop or hiring staff when they have a proven idea that is cashflowing well. Successful businesses plough 10% of turnover into building the business and another 10% into personal & professional development of manager & staff.
Most startups fail in year 1 by developing a product before discovering there is a market for it .... and taking large risks like opening a store for low returns (physical goods have a margin of 10-20%) or risking their home for a loan.
Year 2 taxation is the biggest killer of startups because employees are used to spending all their income once they have it. But when switching to a business taxes are not due till the end of the year. Forgetting to pay themselves first (instead of last) compounds the issue.
Year 3 loss of focus causes problems because too many business owners use a business plan as just a tool to get money from friends, family & fools instead of as a working guide.
Year 4 + the biggest traps include failure to do what only you can do & delegate the rest resulting in burnout.
Business owners are outsiders in society because they have not accepted the social conditioning of working hard for others for 40+ years in the hope of getting a pension of less than half of what was not enough to support your life while working. So they need a support network from successful business people.
A business plan is needed based on the owner's requirement for funding his desired lifestyle *10 ... to give the minimum target profit level of the business.
The successful people/businesses have different accounts and budgets for asset building 10%, education 10%, contribution 10%, play10%, long term saving (eg for new car) 5%, savings/debt reduction 5%, necessities 50%. In other words, budget all your expenses, needs, and desires and stick to it.
Above is not a "Does It All" recipe for business success but should at least give you a few tasty dishes to sic your teeth into.
Showing posts with label Small Business Tips. Show all posts
Showing posts with label Small Business Tips. Show all posts
Thursday, September 20, 2012
Thursday, July 5, 2012
Tips For Avoiding Failure As A Start-Up Small Business
Most small businesses fail within the first few years. That's just a cold hard fact. To avoid being one of them here's some tips to consider....
Many emerging entrepreneurs make the mistake of not being specific enough in choosing a target market. They think they'll be turning away potential customers if their services are not broad enough. This also means that their vision in marketing is too broad and clouded. Lacking a specialty can come off as a lack of commitment or lack of expertise in any given service offered. You don't want to be a jack of all trades, master of none.
Once "positioning" has been determined, I found that many people make the mistake of taking on every client and opportunity that comes their way. Instead, they should be focusing on clients that they will be happy working with, fit well with the expertise they can offer, and actually appreciate what is being offered. The mistake is that they end up dealing with clients that take up all their time and do not help them grow. The focus should be on serving clients that you really want.
Also, when branding and positioning their new business, instead of trying to compete head-on with others on price and/or services, they should try to build a niche in their market and in that way not compete directly with others. Try to be the best in one area instead of being good in a lot of areas.
I think it's irresponsible to tell new entrepreneurs to do what they love and they can make a business. No, not everyone can be an entrepreneur or business owner (which are two different things). A lot of people have skill and passion but lack the technical skills to run a business. Not everyone has access to incubator programs, MBA programs or consultants, so it keeps them from getting properly educated.
The other thing I would say is that people lack confidence and are risk averse. To be an entrepreneur you have to be willing to take risks and be confident in your product/service. Before anyone launches, they should be researching their market (and no, no just reading about it, but getting out there and talking to your demographic). Once you understand where the needs are, who the customer is, and how much they're willing to pay for your solution, then you can start building a company from there. It won't be perfect out the gate, but you'll have an idea of how to build your foundation. You can learn the rest of the skills along the way, or hire your weaknesses.
Too many people start businesses without a clear set of objectives that they can measure over time. This is like shooting a bow and arrow without a target. How do you know if you are successful if you have no target?
Many emerging entrepreneurs make the mistake of not being specific enough in choosing a target market. They think they'll be turning away potential customers if their services are not broad enough. This also means that their vision in marketing is too broad and clouded. Lacking a specialty can come off as a lack of commitment or lack of expertise in any given service offered. You don't want to be a jack of all trades, master of none.
Once "positioning" has been determined, I found that many people make the mistake of taking on every client and opportunity that comes their way. Instead, they should be focusing on clients that they will be happy working with, fit well with the expertise they can offer, and actually appreciate what is being offered. The mistake is that they end up dealing with clients that take up all their time and do not help them grow. The focus should be on serving clients that you really want.
Also, when branding and positioning their new business, instead of trying to compete head-on with others on price and/or services, they should try to build a niche in their market and in that way not compete directly with others. Try to be the best in one area instead of being good in a lot of areas.
I think it's irresponsible to tell new entrepreneurs to do what they love and they can make a business. No, not everyone can be an entrepreneur or business owner (which are two different things). A lot of people have skill and passion but lack the technical skills to run a business. Not everyone has access to incubator programs, MBA programs or consultants, so it keeps them from getting properly educated.
The other thing I would say is that people lack confidence and are risk averse. To be an entrepreneur you have to be willing to take risks and be confident in your product/service. Before anyone launches, they should be researching their market (and no, no just reading about it, but getting out there and talking to your demographic). Once you understand where the needs are, who the customer is, and how much they're willing to pay for your solution, then you can start building a company from there. It won't be perfect out the gate, but you'll have an idea of how to build your foundation. You can learn the rest of the skills along the way, or hire your weaknesses.
Too many people start businesses without a clear set of objectives that they can measure over time. This is like shooting a bow and arrow without a target. How do you know if you are successful if you have no target?
Thursday, June 7, 2012
Facebook Community For Small Business Owners
Are you a small business owner looking for tips, ideas, and resources to help grow your business? Do you want to know more about how you can take advantage of the online world to make your business more successful? Would you like to connect with like minded small business entrepreneurs to learn from each other?
Well you're in luck.
There's a Facebook community dedicated to small business owners, entrepreneurs, and "wanna-bes but not there yets". Nice bunch of folks willing to help each other out with most anything.
Their discussions are hot and lively ... and always helpful. Plus they often have contests and other activities where you can win tools/resources you can put right to work growing your business.
The neat part is ... it's Facebook so it's free.
I suggest you drop by and see for yourself. Don't procrastinate .... you may miss out on something your business can really use.
Simply click here ....
Thursday, May 19, 2011
How Can Small Businesses Beat The Economic Bad Times??
One of the best things we ... as small businesses ... can do to turn around the economy is work together and share best practices. Doing so creates an environment where those who are struggling can improve, those who are surviving can thrive, and those who are winning can lead and shine.
Some examples of such master mind brainstorming and sharing include; think big - if you are local think regional, if you are regional think national, if you are national think international – there’s customers out there just further afield; go back to basics, call your customers and ask how you can be of more service.
With this goal in mind ... help others and be helped yourself .... what tips would you share?
It's easy .... simply contribute your thoughts as comments to this blog post. Come back .... read .... share some more .... and don't forget to pass it on.
So .... what are your tips???
Some examples of such master mind brainstorming and sharing include; think big - if you are local think regional, if you are regional think national, if you are national think international – there’s customers out there just further afield; go back to basics, call your customers and ask how you can be of more service.
With this goal in mind ... help others and be helped yourself .... what tips would you share?
It's easy .... simply contribute your thoughts as comments to this blog post. Come back .... read .... share some more .... and don't forget to pass it on.
So .... what are your tips???
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