6 Important Factors for Sustaining Entrepreneurship
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Passion is believed to be at the core of sustaining businesses. One couldn't agree more! However, other than passion, motivation and willpower, startups would require practising 6 other significant behavioural traits to give their companies a strong footing and sustenance.
Sustainable growth is touted to be the biggest challenge faced by entrepreneurs all over the world. And then we have entrepreneurs living in remote villages who successfully manage farming and sharecropping business without any degree in business management. In spite of being uneducated, they oversee strong networks of farmers, merchants, and seasonal workers.
In doing so, they actually create a long-standing value without exhausting the finite resources at their disposal. It is interesting to note that even with the drastic transformation of circumstances the ground rules of sustainable business growth has remained unchanged.
Here are six of them-
1. Authentic purpose
There has to be a guiding text for every aspect of a business including recruitment, customer management, product development and sales. To do this, businesses first need to pinpoint why they do what they do. That will be the company's True North.
"Achieving sustainable success is only possible when companies constantly review the sense of purpose and ensure the organization carries it out well. A bona fide and stimulating principle allows an unvarying and consistent sense of focus, strong emotional engagement and constant, realistic approach," opined Satyajeet Pradhan, Founder, Bizydale Nets, one-stop solution builder for businesses.
It is the genuine purpose of a company which becomes its "unique selling propositions," or USP. A business with a clear vision finds it easier to develop valuable products and services. Charles Revson, founder, Revlon was famous for saying- he sold hope, not makeup.
2. A powerful brand
Pradhan feels, in order to create a scalable business model, one has to comprehend how decisive it is to create brand equity and emotional engagements with customers. "It is the relationships that connect customers to products and keep them coming back. Brand building is all about making and nurturing those connections over time," he opined.
Some fundamental rules to connect, influence and go ahead with your brand include selecting the target audience, engaging with the public and inspiring the consumers. A simple, motivating communication has much more potential than one that highlights product features, functions, or ideas.
3. Partnership and collaboration
Doing everything by yourself can be appealing initially as funds are feeble and aspirations high. Though the hands-on approach is a good thing, handling more than you can manage, particularly in domains you lack expertise, can be detrimental. With the global freelance economy, it is now very easy and convenient to appoint talented expertise on a freelance basis.
"There is no dearth of websites and online marketplaces which provide dedicated resources in design, development, banking, sales, and legal services. Begin with small assignments and short investments. What is important is to know the exact requirements and engaging skilled resources for achieving targeted goals," shared N. Balasubramanian, CEO, Sresta Natural Bio-Products, one of the leading organic processors and suppliers.
4. Customer retention
In their book Leading on the Edge of Chaos, Emmet and Mark Murphy says, "acquiring new customers can cost an organization around five times more than retaining current ones." Experts also state that reducing customer defection rates by 5% increases profitability by 25% to 130%, depending on the domain of your business.
"Businesses are four times more likely to do commerce with existing customers than with new ones. The probability of selling your product to the existing customers is 60-70%, while it's only 5-20% for fresh clients," informed Balasubramanian.
The very first deal you make with a customer sets the ball for successful retention rolling and it goes on all through the lifespan of the relationship. According to Bain Capital, the global alternative investment firm based in Boston, Massachusetts, for some specific industries, a 10% raise in customer retention is comparable to a 30% increase in the company's worth.
5. Repeatable sales
It is never enough to just create an inimitable product. Recurring sales are indispensable in order to create a scalable model. Signing up a few customers is not a big deal; what actually matters is to plan and apply sales processes again and again at an ever-increasing scale.
"A scalable sales model is when you can add on to the sources of your customer leads on a constant basis, your customer acquisition cost is considerably less than the amount you can eventually receive from that customer and when your buyers get the right product in the right place at the right time," elaborated Maulik Shah, Founder, Paynear, a transactions processing company.
The pedestal to scale is built on the model of regular sales. However, it often takes numerous trialling and a period of thorough research to zero down to a model that's actually sustainable.
6. Adaptive leadership
To ensure growth, business owners must develop themselves as a leader. Given that a company's requirements alter with time, the leader must be ready to evolve at the right tempo. In doing that one needs to be introspective, aware, and possess a devoted sense of rationale-both for short and long-term gains.
Shah believes a flexible leadership approach emerges from being watchful. "Since the individual, interpersonal, and professional lives are all interrelated, being mindful helps in appreciating the associations we make and how to make most of them for initiating, evolving, and leading a business," he concluded.