It’s safe to say that starting a new business doesn’t always lead to immediate success, but there are some things you can do to make sure it stands the best chance. And, if your business does take a turn for the worst or isn’t as profitable as you anticipated, there are steps you can take to build it back up to where it needs to, and you want it to be.
We’re always hearing about a new business that’s launched; another ambitious entrepreneur has noticed a gap in the market and has developed a start-up business to cater to demand. But the sad truth is that not all of them survive. To help you achieve your entrepreneurial dreams and run a successful business with no hiccups, check out these top tips.
How to proactively make sure your business succeeds
1. Regularly update your business plan
It’s critical to have a solid business plan in place that takes multiple growth trajectories into account. It should be a detailed, living document that you update. Refer back to your business plan each month to make sure you are meeting targets and that your business is where you want it to be. Read more about creating a business plan for your franchise here.
2. Be resilient
In the initial stages your business will most likely face criticisms and knockbacks, stay strong and don’t let them stop you working to achieve your dreams. Embrace failures as short-term setbacks and take them in your stride. Take the time to reflect on what went wrong and find solutions to the problems that caused the failure.
3. Consider the risks and rewards
To be successful and help your business grow you may need to take calculated risks. Ask yourself what the downside is and then you can prepare for a worst-case scenario, while striving for the best outcome. Remember, calculated risks can result in huge rewards.
4. Analyse your competition
In order to have the best chance of immediate success and have everything go according to plan, it’s important to study and learn from your competitors. Be switched on to developments in the marketplace in your chosen niche.
5. Conduct frequent SWOT analyses of your system
This is when you examine the internal and external areas of your business, in terms of strengths, weaknesses, opportunites and threats. Start off making a list of what you do well, what you could work on, where you want your business to be in the future and where you are now. Use the outcome of the SWOT analysis to plan your goals and how you will accomplish them.
We all stumble and fall. Maybe I've done it more cataclysmically than most. But you can learn so much if you open your eyes rather than blame everyone else and feel pity for yourself. You need to dust yourself off, turn around backward, and learn what you could have done differently. When you can do that, big things can result. – Bill Bartman, Commercial Financial Services Inc. founder
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Business health checklist
These are just the tip of the iceberg, and there’s lots of other ways to overcome business failure and thrive in difficult times. One thing’s for sure, running a successful business requires in depth analysis of the work process, sales and financial results. It’s important to continually monitor the health of your business, to make sure your business is on the path to profitability.
This can’t be achieved without tracking business metrics or KPIs. Let’s consider the most popular KPIs that can be used to assess your business’ performance and indicate growth or decline.
- Sales revenue
- Net Profit Margin
- Sales Growth year-to-date
- Gross Margin
- Customer loyalty and retention
- Cost of customer acquisition
- Qualified leads per month
- Net promoter score
- Monthly website traffic
- Employee happiness
Click here to read more about KPIs, why they are effective and the benefits of measuring your performance. You can also see another one of our articles about franchise metrics and what to measure here.
You might also want to consider the following factors that need to be examined on a monthly basis.
- Stock inventory check
- Marketing strategies
- Human resources e.g. patterns in absenteeism and sick leave
- Market engagement
- Data protection
- Innovations in the industry
- IT systems running smoothly
- Time management
- Meet with your team to review the month and agree a plan of action
If your business hasn’t experienced immediate success it doesn’t necessarily mean it’s the end of the road. You will need to jump over some hurdles on the way, but there are some ways to turn a frown upside down.
Steps you can take to build your business back up
- Stay positive. Before we go any further, in order to stand a chance at getting your business back on track, you need to change your mindset. If you’ve put your blood, sweat and tears into building your business and it hasn’t gone to plan, it’s easy to see the glass as half empty. But, in order to make a comeback, you’ve got no choice but to adopt a more positive outlook. In order the hush your negative inner voice you could try following these four steps: acknowledge it, challenge it, silence it and fight back.
- Execute a SWOT analysis. Doing so should help identify exactly where you were going wrong.
- Learn as much as possible about your target market and ideal customer. The more you know the easier it will be to develop a strategy that’s right for your business.
- Set SMART objectives. These are a list of objectives that are specific, measurable, achievable, relevant and time bound. This should make staying focused and achieving your goals simpler and easier.
- Manage your cash flow. Make sure you know exactly what’s coming in and what’s going out. Use the cash flow forecast to predict sales and expenses so you know how much money there’ll be in your bank account.
- Explain your situation to creditors. Don’t let the worry of outstanding debt consume you, the majority of creditors are understanding and will support you if they know you will pay back what you owe eventually.
Starting a new business – follow this advice for immediate success
Hopefully by taking this advice on board your business is in a good position to achieve immediate success without any knockbacks. If you’ve enjoyed this, you might want to check out the top 6 contributors of franchise failure and five ways franchisees can get over the fear of failure.
Becky Martin, Point Franchise ©