Starting a new business is very challenging. Just as you begin to make progress, a fresh new challenge awaits you around the corner. Getting caught up in the difficulties of the short-term running of a business can be detrimental to long-term success.
Many start-up owners don’t realize the task that faces them when establishing a business. In most cases, the reasons for starting a venture are due to personal circumstances and work preferences. Too often, owners or management are short-sighted, leading to quick failure. 90% of new start-ups fail, and less than half of business last longer than five years.
Your start-up doesn’t have to contribute to the above statistics. By taking some strategic actions in the early stages, you can give your company a strong chance at survival. If you’ve launched a new business and are eager for success, here are five tips to enable your start-up for prosperity in the long-term.
1.Create a business plan and stick to it
Business plans are key to long term success, particularly for start-ups. In fact, research has shown that companies that operated using a business plan were almost twice as likely to experience growth and success than those that didn’t.
A business plan should be the first course of action. It outlines the goals and strategies of the start-up. It also includes detailed market information, competitor analysis, logistics, operations, and financial projections.
Your business plan should be referred to when making key decisions, and it must be adapted if circumstances change.
2. Source funding
Depending on the type of business that you’re running, you may need significant revenue to get it off the ground. If you have employees, they need to be paid regularly, meaning healthy cash-flow is a necessity. While you may have the financial means to operate on a monthly basis, don’t neglect the importance of cash flow. 82% of businesses fail due to cash flow problems.
3. Professional financial advice
Calculating financial projections, dissecting accounts, and managing cash flow can become extremely overwhelming very quickly. Many start-up owners don’t have experience in this field, making the financial side of the business even more stressful.
Considering U.S. banking history, you should seriously consider hiring a professional financial advisor to guide you through important financial processes. This can save you in the long-term and can prevent unnecessary losses due to inexperience.
4. Establish a clear target market
Having a clear idea of who your customers are is an absolute must for start-ups. It’s essential to know your audience, their interests, and what they seek in a product or service. Marketing plans and strategies should be customer-focused and targeted ads should be a key feature.
Never settle when it comes to your customer base. Always seek to expand through lead generation and various marketing techniques.
5. Be data-driven
Through website analysis and social media insights, a modern business generates a lot of data. This data should be thoroughly analyzed to gain a deeper understanding of customers and the market.
Look to analytics to guide your start-up with executive decision making. Analyzing the right information can lead to significant long term success.