With nearly 50% of businesses not succeeding after their first five years (and 20% in the first year!) it’s handy to know what mistakes you can avoid making and give your SME a better chance at surviving in an ever growing, increasingly competitive market.
So, whether you’re a seasoned small business owner or an entrepreneur just starting out, below is an account of the biggest mistakes that SME’s make today, and how you can learn from these failures to make sure that you don’t do the same.
Sorry to skip straight to the cash, but it’s true (and important). Whether you’re offering a product or a service, a business owner needs to know how much money is needed to keep operations running on a day-to-day basis, this includes funding payroll and overheads (rent, utility bills etc). Owners of failing organisations are often not aware of how much revenue is generated from their products or services, this leading shortfalls that can quickly force a business out of operation.
To avoid this, a realistic budget needs to be set for company operations AND owners needs to be willing to provide their own capital in the start up phase if things don’t quite go to plan. This doesn’t mean that you should give up!
No Market Share
A common case of the world not being ready for you just yet. For example, the failure of MySpace (for those of you that remember) compared to the continued success of Facebook – don’t fall in love with making an idea work if the world isn’t ready for it yet. You might have a fantastic idea, but you’ve got to be willing to adapt it to the market, which leads onto our next point…
The ever-changing business landscape is a minefield for the most successful of organisations, so in the early days it can be tough to navigate your way through external factors that impact your business plan. 2020 saw a record-breaking number of business start-ups across the UK, a 47% increase from 2019. This demonstrates that by adapting to your current circumstances, you can ride the wave of success that comes with it.
For businesses who are solely working towards a goal, not looking forward can be detrimental in the long run as they can find out that the goal posts are no longer where they thought they were.
Yes, we know, broken record. But seriously, if all of your capital is spent in other areas, how are you going to acquire customers? Building a reputation and creating a brand image often gets ignored because it is hard, but that’s why we exist!
If marketing isn’t your bag, then hire someone to do it for you (preferably us since you’re here). It will give you not only brand awareness, exposure and a customer base, but you will be able to track what they want, what they don’t like and use these insights to become more successful. A no brainer!
The Wrong Team
When the time comes to hiring the right person (or letting go of the wrong one) you need to be sure that those around you not only believe in your mission but that you can identify the skill set that is needed from them. We’d all love to work with our friends, but it’s more than likely going to lead to an increase in stress and tension in the workplace and increase strain on your relationship.
Fortunately, with experience in HR and talent acquisition, we know the golden rules to having a happy and effective team. At Strategi we think of our team like a family, each a part of the puzzle that fits together to create the perfect picture. Hiring the right people and keeping them happy in their role is a powerful tool, trust us.
Now, we could go on all day about the right and wrong things to do, but the reality is that no person is an expert in every area that keeps a business not only afloat but more importantly, successful. At Strategi our commitment is to help your business do better, and by outsourcing certain necessary aspects of building your business, the chance of failure is going to decrease.
If you need help with compliance, maybe you’re not sure on your branding, or perhaps right now all you need is some advice, we’re here to help.