It is not hard to see the appeal of becoming an entrepreneur. After all, not only is starting a business much more accessible these days than it ever has been in the past, but it also presents highly lucrative opportunities too. More importantly, it gives you better control over the direction of the company rather than merely taking on delegated tasks and responsibilities as an employee.
However, despite how rewarding it can be, achieving growth is no small feat. In addition, it is not uncommon for many small businesses to fail within the first couple of years of operation. Most start-up owners think that having an innovative idea is all that is required to be successful. What they fail to realise is that setting up a business requires much more than an idea.
It involves setting up processes, structures and organizational capabilities. Streamlining processes and logistics ensures that wastage is reduced to a minimum. A good idea needs to be scaled up by keeping costs down. Keeping additional budgets for marketing and advertising is also something that start-up owners do not take into consideration.
To prevent this from happening, here are a few simple tips that all start-ups should know.
- Emulate instead of innovating
Creative freedom is one of the primary reasons why many aspire to become entrepreneurs. Moreover, while being unique and standing out from the rest of the competition is undoubtedly crucial, it comes with its fair share of risks too. As such, it makes sense to emulate first rather than innovate. Whether it is through commonly used marketing strategies or in ways to keep your workers engaged, echoing the business practises used by successful companies will allow you to maintain a consistent level of productivity, and as a result, increase your chances of success.
Think about the fact that Facebook was not the first social media platform. We already had MySpace and Orkut! What Facebook did best was to learn from the defects in the models of the former. It then utilised its expertise and skill to create a better product. It is a smart and safe approach to being successful. Innovation by itself is not void of risks. Taking an already existing model and improving on it helps you understand the product and market better.
- Keep an eye on the numbers
While it may not necessarily be the most exciting part of running a start-up company, number crunching is crucial to ensure that the business is not only generating profit but remains financially healthy too. After all, without keeping track of the financial figures, it’s impossible to know whether or not the company’s expenses are being offset by the revenue or if there are areas within the business that you can cut costs. And while the services of accountants in Central London may sound like additional expenditure, the benefits of the investment far outweigh the cost.
Most businesses make the mistake of ignoring numbers and data. They fail to realise the fact that numbers help make the planning process easier. The more access to information you have, the better you can make informed decisions. Keeping up to date about the financial reports of your organization is essential. It helps you understand the projections, planning, allocations and overheads. In the long-run, such sound financial planning will help you grow your business in a robust and stronger fashion.
- Build your network
It’s rare for a company to achieve success, much less survive on its own. As such, it is essential for any start-up company to build its network of contacts. Whether it’s through a partnership with another business or a joint venture with multiple parties, creating good working relationships with other companies will not only present more opportunities for growth and development but also allow you to generate more awareness and exposure too.
A business owner should be able to sell himself to anyone. This involves vendors, partners, banks, investors, shareholders and employees. A person who wants to do business in isolation can never succeed. This is because modern businesses are set up in that fashion. It requires networking, calling-in favours and building relationships. The best part about networking is that it helps stimulate ideas and productivity. You might meet someone who will be able to tell you about an entirely new market that you should try. Or, you can network with the head of a financial institution and seek some credit of better rates of interest.
- Focus on your niche
With plenty of opportunities to find success, it’s easy for inexperienced entrepreneurs to get ahead of themselves and try to do too many things at once. Not only is the approach much more costly, but there’s too much financial risk involved. As such, it makes sense to focus on your niche first. In this way, you won’t be overextending yourself and spreading company resources thin, but you will also minimise the risks involved.
By concentrating on what you are good at, you will keep improving and innovating on the product. Interest is also something that guides every business model. By spreading across too many business verticals, you will be over-stretching resources, expertise and risks. For first time business owners, sticking to their niche, at least in the first couple of years in their business is necessary. Being safe and conservative is not such a bad thing after all.
Every start-up owner tends to think about the positives and benefits of starting his or her own firm. This is a normal human tendency. We tend to concentrate only on the positives. However, if we are able to also look at future challenges and plan accordingly, our businesses will always be in a better state of operation.
Even with all of the challenges that it presents, running a successful start-up is relatively straightforward and simple. By following the tips listed above, not only are you far more likely to find growth within your chosen industry but do so with minimal risk too.