How many entrepreneurs do you know start a company with the intention of failing? We hope that this number is zero, but failure can be the result of a business even if it is unintentional. Serial entrepreneurs know many different ways to fail. This is because success in not guaranteed no matter what business you get into. They also share their tips to avoid failure to help you start a profitable business.
Surround Yourself With The Right People
The phrase “It takes a village to raise a child” also applies to a profitable business. Without talented individuals working for you, it will be very hard to survive. Surround yourself with amazing friends and successful business owners so that you can have access to different skills and knowledge that can help you grow a profitable business and make it thrive.
Build a Strong Foundation
Before starting your business, ask yourself why you’re starting it in the first place. How is your product or service going to help your target audience’s lives better? How does this idea align with your core values? Do you have a solid profitable business plan to make this dream a reality? The answers to these questions will help your business have a strong foundation.
Perfect Your Pitch
You should be able to describe your company in 3-5 words. Think of AirBnB: a place to stay. Describing your business concisely will make it easy to understand. If it is easy to understand, it is also easier to sell. When working on your pitch, stay away from mistakes like using industry jargon that is hard to understand for the layman, asking the wrong questions to those who listened to you, not making the pith relevant to the listener or only talking about yourself.
Know Your Competitors
Keep your enemies close and your competitors closer. They are not the enemy but not knowing what they’re doing could be harmful to your company. Don’t hesitate to use tools to analyze your competition. Tools like SEMrush, SimilarWeb or even Google Alert can help tell you what your competitor is up to and increase your chances of survival.
Build a “Must Have Product”
Sites like Hacker News have a ton of really cool startups ideas. However, if you really want to increase your chances of survival and success, build a must-have-product instead of a nice-to-have product. The difference between the two is easy to spot. The former is a product that is hard to live without while the latter is more disposable.
Build A Company That You Can Scale Independently of Your Staff
It’s better to grow a company that can be scaled using technology and automation. Take Groupon for example that did the opposite. They have a massive staff because they need it to keep new deals flowing everyday and to service their customers. Their company is not scalable because their growth is dependent on the number of staff their hire. This is why their balance sheet is awful.
Find Ways To Keep Costs Low
You can think of cash as your company’s lifeblood and high cost is equivalent to a hemorrhage. Remember that all the cash in the world is not worth anything unless it’s a positive cash flow. Find ways to keep your costs low like going directly to the supplier or negotiating for better prices. Find better ways to finance transactions and ways to work out deals.
Focus on Sales and Marketing
Nothing happens in business unless a sale is made. From the start, find ways to get leads and ways to convert those leads into sales and make sure you are getting repeat sales from your customers. To do this you need an effective sales and marketing funnel that you can work, test and measure.
Always Find Ways To Increase Profits
Don’t rest on your laurels yet. Don’t just be happy with getting customers and making them buy from you. Always find ways to get them to buy more.
Brands like Apple and Ikea stand the test of time because they have followers who are loyal to them. They also differentiated their companies from their competitors by embracing innovation and creativity. Reach out to your employees and don’t be afraid to use their ideas. Launching new products and developing a clever marketing campaign is a good way of retaining that competitive edge your company needs.
Test and Measure
Are your marketing campaigns increasing sales? Is your social media presence helping drive traffic to your website? Testing and measuring everything gives you perspective especially if you want to find ways to increase traffic and keep costs down. Use tools like Google Analytics and Unbounce to help you test and measure marketing campaigns.
Empower Your Staff
No matter how big or small you are, empowering your staff by letting their voices be heard can help boost your profitability. When they feel that they are contributing or when you give them freedom to work, you are making them feel wanted which can greatly affect their productivity and self confidence.