What would it be like to own a business?
Many people ask themselves this question – unfortunately, only a small percentage of them actually achieve great success and establish companies that survive for more than three years. Of course, survival alone is not enough – the business should earn a profit high enough to provide its owner with a comfortable level of life. While the statistics are devastating, there are a few things you can do to decrease the probability of failure – Here are 5 things to know before working for yourself from 5 to 1!
5. Do thorough market research.
The majority of people who start a business admit that they did little to no market research. Many ventures are started on pure assumptions, and their owners have no idea whether there is a need for their product and who their ideal customers are.
By researching your market, competition, and your clients, you can adjust your strategy and potentially find a niche that could give you a huge advantage over your competitors from the very beginning. And by knowing the ins and outs of the real needs of your customers, you can better manage the tiny differences in your offer that can either kill your business or skyrocket your sales.
4. Invest in the right marketing channels.
Many aspiring business owners and beginning entrepreneurs believe that it’s enough to set up a Facebook fan page, print some flyers and wait for the customers to come and the money to roll in. Unfortunately, unless you have a huge network of friends (and can profit from them and their word-of-mouth), you’re going to have a hard time.
Depending on the type of your business, your customers may have different preferences – some companies grow exponentially using offline advertising, while others benefit the most from using specific online marketing channels. Make sure that you know where your clients are, and spend money on channels that give you the highest chance of reaching your customers.
3. Save enough money to survive at least a few months if anything goes wrong.
Unless you have an upfront funding, you will need to rely on your savings to survive the first few months. If you are starting a business purely because you’ve read all those fancy stories and want to get rich (while having no money to pay the bills), quit right now and find a regular job. Your business won’t grow if you don’t reinvest the profits back into it.
Sometimes people make money from day one, but you can never assume you will be one of them. By having spare cash, you can not only survive the first few months but actually make much better business decisions. Without having to worry about your bills, you will have much more confidence and clarity when planning your business strategy.
2. Find the core differentiator of your company.
Starting “yet another business” without thinking of a way to differentiate yourself, is not the best idea. Hundreds of companies are set up every day without the right strategy and plan. If you have a hard time finding something that differentiates what you’re doing, focus on “how” you do it.
John Jantsch, who has frequently been called the world’s most practical small business expert, suggests it’s more important to focus on how you’re doing things in your business rather than what you actually do. Make sure that the differentiating element is easy for your audience to spot and compare. It doesn’t have to be groundbreaking, but it can definitely help you in your advertising efforts.
1. Get qualified – you will thank yourself later.
Have you ever read about one of those wealthy college drop-outs and wondered why do you even need education if one can get rich without spending a few years educating? Unfortunately, what a lot of people forget about is that these people are a minority in the sea of educated business owners. The truth is that by getting the right qualifications, you can get a significant advantage over your competitors.
Moreover, if you choose the right course, you can learn a lot about running a business without risking your real money. And don’t forget that a diploma gives you a strong Plan B, should anything go wrong. Should your company go under, it will be much easier for you to get back into a regular job, before you re-evaluate your business plan and give it another go.