Anyone can start a business nowadays; you simply need to fill out a few forms, get the necessary licences and permits and advertise your new venture in some way. However, running a successful business is a completely different story.
Research has shown that approximately 9% of businesses, both old and new, close each year. However, only 8% of new businesses open. This means that we’re losing more businesses than we’re gaining. Not only that, but evidence has also suggested that approximately 50% of all new businesses close within the first five years of opening.
There are, of course, several reasons why a business might fail. However, according to a recent study, some reasons are more common than others. These include:
- The product or service is not needed – no matter how good your product or service is, if there is no need for it, it will not be successful. Businesses should complete market research to make sure their product or service is needed.
- They run out of money – setting up a new business can be expensive. New businesses will need to make sure they have enough revenue to get them through tough times.
- They employ the wrong people – research has shown that the most profitable business owners encircle themselves with people who are more intelligent than they are. Having a good team is crucial.
- Pricing – it’s important to price your products or services right. Price them too high and you limit your customer base. Price them too low, and you might not make a profit.
- Too much competition – if the market is already saturated, you’re fighting an uphill battle.
While these may be the most common reasons why a business fails, they’re not the only reasons. Other reasons include opening a business in a bad location, ineffective marketing, a poor business plan, expanding too quickly, and so on.
Whether you’re an entrepreneur or you’re a business owner who wants to make their business more profitable, you’ve come to the right place. There are several things you can do to make your business more successful. If you want to grow your business and make it more profitable than ever before, here are some suggestions to help you make it happen. Just remember, growing a successful business is a marathon and not a sprint.
1. Focus on Customer Service
Research has shown that approximately 51% of customers will not return to a company if they have experienced poor customer service in the past. Other evidence has shown that it can take up to five positive customer experiences to make up for one bad experience.
Given that it is much easier to sell to loyal customers, it’s important to make good customer service a priority in your business. Business owners should look at the customer service they offer and make any necessary alterations. You may need to do things like:
- Make basic improvements to customer service – such as responding to emails more promptly
- Invest in things like staff training
- Make alterations to your returns policy
2. Attract and Retain Good Employees
In business, attracting and retaining good members of staff is one of the most valuable things you can do. Research has shown that nearly all successful companies rely on employing quality employees and retaining them for the long term. This means that businesses should not simply build any team; they should build a super team. As much as your budget allows, try to surround yourself with individuals who are experts in things that you are not.
3. Improve Knowledge and Skills in Your Team
It’s no surprise that the performance of a business is essentially a team effort. The talent you hire directly affects the success and performance of your business. You need to make sure you hire the right people for the roles within your company.
It’s also important that you identify any gaps in the training and skills of your employees. You should consider conducting a skills and training gap analysis for the employees in your business. Once you’ve done this you can make changes to your hiring and training plans.
You should also consider improving your skills and knowledge as a leader. You can do this by completing an Executive Doctor of Business Administration (DBA) at Aston University Online. The Executive DBA is ranked as one of the world’s best DBA programmes. It was created for business leaders to build the knowledge and skills needed to resolve complex business problems.
4. Build Word of Mouth for Your Business
Word of mouth is more imperative than ever. Most shoppers now spend time searching the internet for reviews on products and services before choosing where to shop or what product to choose. This means that having a good reputation is extremely important.
Businesses will need to build and monitor their local reputation, offer their customers good customer service, and gain publicity for their business. One way they can do this is by giving back to the community through supporting local charities and organisations.
5. Improve Your Marketing Efforts
Marketing is an ever-changing, constantly evolving field. What worked a few months ago may no longer work today. If you want to be successful, you will need to adapt to change as it happens. Here are some of the ways you can improve your marketing efforts:
- Send out promotions to loyal customers
- Involve the newspaper in your charity events etc.
- Cold calling – although many business owners believe this doesn’t work, research has shown that it can increase sales
- Advertise your business in local shops, newspapers, in your car etc.
- Develop partnerships with other businesses
- Offer free classes or workshops related to the products or services you offer
Anyone who owns or runs a business will know that it takes a lot of hard work and dedication to succeed. Whether you’ve just set up your own business, or you’re aspiring to soon, there are a few challenges you’ll have to overcome along the way. When it comes to running a business, problems often arise faster than you can solve them, your company may not grow as fast as you’d hoped it might, and, despite all your hard work, your business might not make enough profit. However, overcoming these challenges is what running a business is all about. If you want to turn your business into a successful venture, then make sure you follow some of our top tips above.