6 Key Things to Keep in Mind Before You Launch Your Business
Don't become another failed-business statistic.
Running a new business requires a solid strategy supported by proven facts. While it is usually possible to get your business off the ground, there are always factors that may impede your dream of being a successful entrepreneur. According to the U.S. Bureau of Labor Statistics (BLS), 65% of businesses fail within the first ten years.
Here are six important things to keep in mind before starting a new venture.
1. Strategy is key
According to the BLS, 20% of new businesses fail within two years. This suggests that high failure rates are primarily due to poor planning, lack of knowledge about what it takes to start a company or insufficient funds during critical stages of development such as marketing campaigns, product-design-development costs and staffing decisions.
Businesses should be based on sound research and planning, including acquiring adequate capital, having the proper structure in place and assembling an effective team to carry out operations; these are all factors that can significantly impact growth and success for any firm.
It is essential to have a strategic business plan to know what you're getting yourself into before taking such major steps towards becoming your own boss; learning about potential pitfalls ahead of time will better prepare entrepreneurs when making strategic decisions. If done correctly, starting up a business may take longer than expected, but it can bring tremendous rewards once everything falls into place.
2. Be wary of crowdfunding
Crowdfunding can become your worst nightmare if you fail to gather enough support. If your startup fails, you risk losing the public's trust in your organization and that of individuals who have pledged money to you. Additionally, someone may discover your concept on a crowdfunded site and steal it if you don't safeguard your business idea with a patent or copyright.
3. Get online
Consider you customer base and how much it will contribute to revenue generation. According to FitSmallBusiness, 54% of consumers prefer to buy online rather than make purchases in person at brick-and-mortar stores or other physical locations like malls or exhibition centers. When you realize that this is the case, running a business with an online presence becomes crucial.
4. Optimize for flexibility
Baymard recently found that shopping-cart abandonment on ecommerce websites stands at 69%. For that reason, you must make sure your website functions properly before launching, even more so if you plan on offering multiple payment options like PayPal or Google Wallet (not everyone will be willing to pay with a credit card). Finally, there are specific tools and tactics that new businesses should avoid when they first launch. For example, using social-media marketing too early in the process may not always work out for new firms since many consumers still prefer websites other than Facebook or Twitter.
5. Plan on going public
A new study by Deloitte recommends preparing for an IPO between 18 and 36 months in advance of the anticipated IPO date. Therefore, when the market conditions are right, having the proper documents in place will help when launching your IPO.
6. Having a Plan B doesn't hurt
Still, even with all this knowledge and proper planning, some businesses may fail regardless because of external forces beyond their control, including economic downturns or lack of interest in the products or services they offer. This is why it is essential to have an effective Plan B on deck if things are not going smoothly. Adaptability is critical; it's important to remember that passion alone won't cut it.
With these strategies in hand, you'll be poised for maximum success before your launch and avoid becoming another failed-business statistic.
Entrepreneur Leadership Network Contributor