Almost every day you can pick up a newspaper or a business magazine and learn about another business and another startup that has failed. Somebody amazing spotted the niche in the market that needed to be filled, and they’re running a multimillion-dollar business now, selling the latest and greatest gadgets. It’s rare for that to happen compared to the failures out there.
Almost 50% of businesses will fail in their first year and it doesn’t matter whether they start out with strength and earning millions or they start out with nothing and build up slowly. Failure is inevitable if a business is not run correctly. Some of the most successful businesses still bust within nine to 10 months because the business hasn’t been set up in the way that it should be or because they’ve overextended their reach. Avoiding business failure is pretty much the main goal of every single new business owner out there.
Nobody imagines that they’re going to fail within the first year when they first get started, especially if their business gains quite a lot of traction from the get-go. Understanding how you can ensure that your business is not going to be one of those failures is important. You want to give your business the best chance of survival, and we’ve put together the tips you need to ensure that that’s the case for you.
1. Understand the support that you need
Almost every business that starts up starts with one person with an idea. They are the marketers, the IT team, the financier, they are the business development team and the sales team. You have one person wearing many hats, and while that sounds like a great way to start cheaply, it’s also a great way to start with failure. It’s OK to have support, even if that support is not even a physical person. For example, the best chatbot for website interaction is still going to help by being supportive and answer questions from eager customers when you can’t get to the phone. You need to be aware that you can outsource if you don’t want to hire in house from the get go, and you need to understand where you should be outsourcing in the first place. When you understand the support that you need, your business is going to feel more solid compared to other businesses as a start up.
2. Be interested in what you do
It sounds silly, but there are plenty of business owners out there that are just looking at the end goal rather than being interested in how they get there. If you’re not thinking about this idea and plotting ways forward and planning how it can benefit your customers, then why would you be doing it in the first place? The idea that you have your business should be the kind that keeps you interested in yourself. There’s no point in reaching out and starting a business for yourself if you can’t maintain your own interest in it, because how can you then expect your customers to maintain their interest in you? It’s not just about earning all of the money. It’s a nice side effect, but you need to feel like your business has got some strength.
3. Be resilient and watch everything
In the early stages, you’re going to hear criticisms, you’re going to receive knockbacks and you’re even going to get insults, and all of these things are things that you need to weather. You have to be switched on with what’s happening in your marketplace and in your niche to know what’s trending and what’s not. What if you’ve started something you think is completely unique, only to find out that several other businesses are already doing it? That’s going to be a kick in the teeth, and you have to be willing to weather that storm. There is a certain level of resilience that you’re going to need as a business owner so that you don’t feel like you’re going to fail. Remember, people in different parts of the world are going to have the same idea as you. There are billions of other people who are going to think of what you’ve thought of. You just have to be the one to do it better. Registering your trademarks or patents is going to be necessary, so don’t forget to take that step.
4. Make sure that your team is experienced
If you’ve never owned or run a business before, then you’re going to need some help to do that. You cannot be a lone person doing it all by yourself if you have zero business experience. The most important thing you could have here as a mentor. Sure, you can set up your startup and do everything you can based on what YouTube and what other people tell you to do, but a mentor is going to be able to walk you through the process and support you through it. A team of people helping you that make sure that experience, training and knowledge are present even if you already possess business acumen in a similar area will help. It may look easy to start a restaurant, for example, because you like good food, but that doesn’t mean it’s easy compared to starting something else. Whatever it is that your business is going to be doing, you need to ensure that there is some experience in that niche somewhere. That inside track is going to make a big difference to avoiding business failure.
5. Make sure people are committed to you
A startup can really test your individual mettle. Not only are you going to be starting something with the hopes that there is longevity involved, but you have to make sure that you are committed and the people working for you are committed to the vision that you have. Startups will often fail because of financial or relational pressures. They also fell because of an insufficient understanding of operational business knowledge. Do you know much about how AI can help your business? Your mentor may know. Having the knowledge around you will help, so make sure that you have people committed to helping you and not just trying to make a buck.
6. Ensure your business idea is not flash in the pan.
If you’ve spotted a gap in the market somewhere, and you believe that you have a solution to that problem that’s going to be successful, you need to stop and do your research. You could be right in terms of your solution and you could be correct that you could offer something amazing that is long lasting and successful, but that’s not always going to be the case. You have to ensure that your idea isn’t just something that is going to be great today, but gone tomorrow.
7. Research is going to be your key
If you believe that you’re onto something amazing, then you need to put the research in and do the time. It could take a while for you to do enough research to ascertain that this is going to be a good business idea. You need to test potential buyers and you need to test potential products. If you’ve come up with an idea for something, then you need to make sure that other people are actually interested in your idea and it’s not just you. Market research, focus groups are all going to be able to help you to start something amazing.
8. Don’t quit your day job
Having a startup idea doesn’t mean that you quit your job and you go full business mode, especially if you don’t have any support. You need to back yourself up with at least a secondary and regular source of income just in case your startup does fail. Being realistic about the chance of failure is important. You won’t always be able to stay on top of your business idea, and it’s much better for you to grow something on the side until it’s too big to run on the side than it is to quit everything and start from scratch. You don’t want to destroy your income stream or your ability to maintain a roof over your head just because you had a good idea.
9. Don’t go into debt.
You’re probably going to borrow some money when you first start your business, but if you can avoid it, do. There is a tipping point where things can go a little bit crazy and you borrow in pursuit of that pot of gold at the end of the rainbow. If you are realistic about the funds that you have to work with and spend the first couple of years piling every bit of profit back into your business for growth purposes, you’re going to be able to enjoy significant experience in your niche and ensure that you don’t grow too fast. Often fast growth is what trips up a business. You might think it’s a great idea, but realistically, if it’s not sustainable growth, it’s not going to last and it will collapse in on itself.
