While no-one goes into business with a plan to fail, the sobering failure rates of businesses, especially in their formative years can be enough to put off even the most resilient of entrepreneurs.
Despite the disturbing statistics and harrowing anecdotes of bankrupt start-ups, there is a portion of success stories – those entrepreneurs that learned from the mistakes of the past and confidently navigate your business to success!
So why do businesses fail to succeed?
ARE YOU PLANNING FOR FAILURE OR SUCCESS?
Business plans are the foundational framework on which your company is built upon and should never be overlooked. A clear vision and business plan will help founders and leaders to make critical strategic decisions for the business.
The process of creating a business plan helps entrepreneurs determine if there is even a need for the business. It should outline the business vision, goals, define the target market, and milestones to measure success. The plan should also include detailed market analysis, potential problems and their solutions, workforce needs, tech stack required, financial capital required, cash flow analysis, income, and expense forecasting. As well as competitor analysis, a strategic plan to budget and manage growth, and detailed marketing and promotional activities.
It makes complete sense to analyse and research the ins and outs of a potential business prior to set up and trading, so why wouldn’t you invest your time into creating a solid one? Otherwise you could find yourself unintentionally wasting your time and money into a business that is destined for failure. That being said, if your original business plan is outdated or it seems overwhelmingly inaccurate, then you will of course need to analyse, review, strategize, and implement changes needed for success in today’s ever evolving market.
Strategies, milestones and timelines outlined in a business need to be implemented and met to stay on track! When you design a well-researched, thought out, and detailed business plan, you are planning for success!
GOING TO MARKET
Just because you love your product or service, doesn’t mean everyone else will. The truth is that sometimes passion, desire, and drive can get in the way of the cold hard facts! Businesses that fail to investigate and understand the market, are essentially setting themselves up to fail! Additionally, if you assume that “everyone” is your market, then you are going to run into some trouble!
Businesses need to be assessing whether the current market big enough to be profitable and if there is an opening in the current market for the product or service? Another important question to consider is: Does your product or service solve an existing problem in the market?
Remember a few years back when there was a frozen yoghurt store on every corner? The reality is that, pushing your product or service into an already over-serviced and overflowing market is going to be an uphill battle, if what you have to offer isn’t overwhelmingly better than the rest!
Conversely, if you can identify an unmet need or problem in the market and then tailor your product or service to be the solution to that very problem, or fill a gap in the market, then it will be much easier to find your way into the market and attract customers.
CREATE YOUR OWN BUZZ
Businesses that fail to provide their customers with a product or service that either doesn’t meet expectations or provide any added value to their experience, eventually will meet their inevitable demise.
Can you recall a time when you, as a customer, purchased a product or service and you were so impressed with that you simply raved about it! Perhaps you posted about it on social media, posted a public five-star review, or called up your nearest and dearest to tell them about your experience and recommended them to do the same? Or perhaps you have been on the receiving end of someone else singing the praises of a company or product from their experience? What was the result of those interactions? Did you or the other people end up becoming a customer of that company?
Why does this happen? Well, the consumer experience was not only simple and enjoyable, but it also exceeded their expectations. A business achieves this by adding value to their product or customer experience.
“Added value” may be a buzz word, however employing this strategy creates buzz in itself! But what it boils down to is, businesses adopting a customer centric approach where they go the extra mile for their clients throughout the entire consumer lifecycle. Value, isn’t always about being the cheapest, offering discounts, or freebies.
It is about ensuring that their experience with you, is a smooth, trouble-free, enjoyable, and memorable one. There are a multitude of ways that businesses can add value to their customers, it could be that you offer better quality than competitors, faster delivery, expert advice and service, exceptional after care and continuous support for example. Where possible, find ways to exceed expectations by under-promising and over-delivering.
Adding value to the customer will concurrently add value to your business! People will spread the word amongst themselves, either by recommendation, reviews, or social media, which in turn furthers your reach in the market, building trust, establishing a strong presence and recognition in your brand.
PEOPLE? WHAT PEOPLE?
You may notice already, there is an underlying theme in business that is paramount to being successful. Business is fundamentally about people! It may seem obvious but a lot of business that fail, have done so because they have not taken the time to truly understand and listen to their customers!
People are what make up your target market and customer base, and businesses need to strategically market and add value to their customers, so they can feel confident in handing over their hard-earned cash to your business in return for your product or service. Consequently, based on this information, implementing any of these strategies, heavily hinges upon an in-depth understanding of your customers!
Without inviting yourself over for dinner with every transaction, how do you gain an in-depth insight into your customer base and target market?
Firstly, your existing customers are invaluable source of feedback, so listen to them! Even the most unfavourable review, complaint, or criticism is invaluable because it can alert you to customer concerns and pain points in their experience. This information is instrumental in keeping your product and service relevant and in line with consumer wants and needs. Learning about your customers can be executed various ways, but it all comes down to data collection!
1. Website Chat and messenger tools or CRMs. These tools help to optimise the customer experience and engage with your current or prospective customers in real time. You can utilise the data collected to analyse trends and patterns in your customer base.
Google Analytics You can also utilise tools such as Google Analytics to gain further insight and data into how and where your website traffic is being generated. This data can help to tailor SEO for your website and develop targeted marketing strategies. One of the added value features of Google Analytics is that it also allows you to gain insight into your competitors traffic as well!
2. Alternatively, you can always give your customers a platform to have their voice heard via customer surveys, feedback, and reviews.
LOCATION, LOCATION, LOCATION!
We have all heard that one, it is basic common sense! Naturally, if your business operates predominately on foot traffic but you have set up shop in a one-horse town, then the bad location will be the death of you! Likewise, a great location with high rent and little return, and you may find yourself in line at the welfare office sooner than you think! However, a face to face business with no website, social media presence and marketing is going to lose potential business to competitors that do have a strong online presence!
The world has undergone a complete transformation over the last 30 years and even more so in the last two! Today a website, social media presence, strategic and targeted marketing is a must! The reason is obvious, the internet is typically going to be the first place a potential customer is going ‘search for’ or be ‘exposed to’your brand, product, or business!
So, in today’s world, the old saying “Location, location, location” is even more relevant to the internet! For instance, you can probably think of a little family run Chinese Restaurant in your area that operates solely on foot traffic, they may have the best Chinese food in the area but they don’t have a website, or social media and don’t offer their food on Uber Eats for example.
However, when the average person is considering where to eat out on a Friday night, they will furiously google “Chinese Restaurant near me”, search websites, menus, and reviews before they decide where to dine out. You can only image how many customers they would be losing to their competitors who may not be the best Chinese food, but they have marketed
their restaurant professionally, with a menu, appetising pictures of their food, contact and location details. They made themselves accessible via every available avenue!
Businesses must ensure that their marketing strategies not only has a wide reach, but it reaches the right people! Well optimised internet presence in combination with clear and strategic marketing to promote their unique value helps will establish and build your online presence, generate leads, and promote brand awareness. If that all sounds extremely daunting and you have some funds to invest into developing your internet presence, then engage the services of Professional website developers, Search Engine Optimisation Specialists. If you don’t know what or how to do something, you can always engage the services of someone that does!
ITS UP TO YOU!
Ok so, you have assessed all external factors, developed a plan and you’re ready to take on the world! Hang on a second, with all that drive and determination running through your veins, your eyes on the prize and sniper precision focus, you may be neglecting one critical and potential hurdle on your journey to success…. you!
If business is all about people, don’t forget, YOU are one of them! As the visionary and leader of a company you wear many different hats in business, however despite your overwhelming amounts grit, focus, planning, and passion, your business will see itself out the door, under poor management and leadership failure. Generally speaking, a new business owner will typically lack relevant business, management and operational expertise in finances, sales, procurement, production, human resources, and people management.
Poor leaders will make poor decisions which negatively impact the business. For example, they may not manage their cash flow properly, fail to recognise or understand the importance of creating good culture for employees to thrive in, they may not have an appropriate plan to scale the business or implement the wrong tech stack which creates inefficiencies and reduces productivity.
Regardless of how seasoned an entrepreneur may considers themselves, a business will go under if the owner is unable to reflect and identify their weaknesses, because they naturally will not engage in professional development or seek help when needed! So, while the success of the business is on your shoulders, it is important to understand is that you need to continuously improve and develop the skills that need to be refined, through reading, courses, seminars, networking or find a mentor.
It is crucial to also understand what your time is worth and invest your time and professional development in the areas that you will need on an ongoing basis and will help you to achieve your goals. For instance, you don’t need to spend 150 hours that you don’t have, learning how to code and build a website when you could instead outsource that task. Alternatively,
you can hire employees who are abundantly qualified with a skillset you need or outsource work to competent professionals.
A successful leader is a combination of someone who can strategically think, manage change, envisage new possibilities for the future, is skilled at hiring people, training, delegation, conflict resolution, drives innovation, is flexible, builds rapport and creates an environment that encourages productivity, employee affective commitment, and engagement. This is of course amongst a plethora of other qualities; the required skillset is exceptionally vast!
In order to be superhuman, you need to firstly, know what you don’t know and be driven and focused enough to learn, acquire and refine those skills and never stop learning! Strive for continuous improvement for your customers, your employees, yourself, and your business! Customers expect continual innovation and if you fail to deliver that to them then someone else will!