Take charge of your startupDate posted: 8/27/15 10:00:00 AM
Why do so many small businesses fail?
It's a troubling question for many potential small business owners, and it's not easily solved. According to a report from Bloomberg, eight out of 10 entrepreneurs who start businesses fall flat within 18 months of opening.
Eric Wagner, a contributor at Forbes, believes that many startups fail because the company doesn't know how to communicate with its market. Wagner said business owners need to walk 1,000 miles in the shoes of their target market, adding that it's vital to have real dialogue - whatever the channel - with prospective consumers.
So, if you are starting a business, that means talking to as many people as you can about the company and the services or products you offer. Wagner claimed this will give you a better feel for what customers need or want and what they might be interested in.
Nathan Furr and Paul Ahlstrom, co-authors of the book 'Nail It, Then Scale It', asked: "Which would you rather do - talk to customers now and find out you were wrong or talk to customers a year and thousands of dollars down the road and still find out you were wrong?"
Getting out there and communicating is the basic building block for many companies.
Saving money as a business
Expenses add up quickly for many companies, which is why it's a good idea to always look at your budget and ways to be frugal. One method to consider is cutting down on your company's outsourcing. While you won't be able to do every project in-house, there are certain jobs that you'll be able to do in-house to save cash.
Matthew Reischer, CEO of LegalAdvice.com, told Mashable that savvy small business owners should try to learn about Internet marketing.
"He can execute some easy strategies himself and save some money in the process," Reischer said. "Try to have a mindset that recognizes that we are in a era where you can use technology as a megaphone for most of your marketing efforts. The trick is to always realize when you can do something yourself as opposed to hiring expensive outside help."
Prioritize word-of-mouth referrals
Nothing is as influential to consumers as a positive recommendation, which is why Jenny Karn, co-founder and vice president of public relations firm Beutler Ink, believes that word-of-mouth referrals are vital to a company's success.
"Nothing is more valuable for our business than a glowing word-of-mouth referral, especially from individuals well respected in the industry," Karn told Mashable. "Knowing this, we've been open to taking on projects that aren't highly profitable, trusting that developing those relationships will help us in the long-run."
Karn said the ability to do so has helped her company land a flood of new clients that they would never have met on their own.
Internships can cut costs
Does your business lack the funds to hire additional manpower? If so, it might be time to consider offering internships to current students or recent graduates.
"Small business owners should be all about scaling flexibly and making very few long-term commitments to full-time hires, service providers, etc.," Rob Biederman, cofounder of HourlyNerd, told Mashable. "Finding services where you can pay solely for what you need (and scale quickly) is the name of the game for small businesses."
Not only will interns come at a cheaper price - and do so because many want to beef up their resumes - but you might find a potential full-time employee somewhere in the mix. Finding young, enthusiastic employees is becoming increasingly hard for many business owners, as competition grows in the job market. If you find a great intern, it might be wise to stay in touch and contact them later if a full-time opening becomes available.
- How to save $1000 (or more) on a budget - 1/19/18
- Overlooked home maintenance for every season - 1/5/18
- Winterizing your home and finances - 12/12/17
- Retirement plan options - 11/29/17
- Best time to buy a car: December - 11/29/17