10 Qualities of Successful Small Businesses
Every small business owner wants to succeed, but the reality is that 1 in 5 ceases operation before the one-year mark, and a further 48% crumble before making it to five years. With these overwhelming statistics in mind, how do small business owners avoid becoming another example of failure? Below, we discuss ten qualities of all successful small businesses.
A Fantastic Service or Product
Businesses need a winning marketing strategy to push their product or service into the public eye. However, all of those efforts fall flat if the service or product lacks quality. Only by meeting consumer needs effectively, and solving a real-world problem, can a business secure lifelong customer relationships.
Once customers are supporting your business, they’ll spread the word about your brand for free. Therefore, by creating brand ambassadors out of your existing customers, you stand a better chance of getting your business on the map.
Smart Marketing Strategies
To launch a product and brand into the public’s mind, small businesses must have a smart marketing strategy. However, putting together a marketing strategy isn’t always easy for a small business, especially when resources are being pulled by other business efforts. Typically, a small business has to prioritize marketing efforts and only focus on those with the biggest returns, like SEO. In many cases, businesses choose to outsource marketing tasks to companies like Growth Foundry, who will put together a rigorous roadmap that’s guaranteed to boost sales.
Without excellent organization, a business will descend into chaos and inevitably fail. It doesn’t matter if a business is physical or remote; effective organization sits at the heart of small business success. Time is precious when you’re operating a business, and being able to find important documents quickly will help you make the most of it. Therefore, whether you have a filing cabinet or an IT infrastructure, everything must be clearly stored and labelled.
Research, Research, Research!
Building a successful brand involves bringing a personality to your business – one that will resonate with customers. However, a good idea and personality alone won’t build a successful business. Instead, entrepreneurs need to spend time researching their market to find gaps in the market.
A great example of this is Better Not Younger, which noticed that hair companies fail to speak to older women. The business owner, Sonsoles Gonzalez, figured out that the haircare giants typically focused on women between 18 and 55, leaving those 50+ behind. On the back of this data, Gonzales built a company committed to making older women feel like the best version of themselves.
Ability to Make Challenging Decisions
Every single small business owner will come across forks in the road, which calls for tough decisions and sacrifices to make. In many cases, these decisions involved removing emotions and acting in the best interest of the business. Unfortunately, some businesses are unable to realize when their own pride and ego are getting in the way of success.
To turn a small business into a success, owners need to understand that asking for help is not only okay, but also beneficial. Additionally, listening to what others have to say, including customers, and taking action will help with success.
Employing the Correct People
Effective employees are an essential part of any company, but small businesses must hire the right people for the job. After all, the hiring process is expensive, which means turnover needs to be low and results need to be high. Choosing the correct people ties in well with managing overhead costs (below). After all, wasting money on an individual that’s no good for the company is the same as taking your liquidity pool and flushing some of it down the drain.
Positive Company Culture
Hiring a fantastic team is only part of the battle, you need to have strategies in place to secure them. Therefore, you should work hard to build a positive company culture with desirable incentives. A large part of building a positive culture in a small business is a shared sense of team spirit and commitment. For example, every single person in the team needs to understand the company goals and then all reached milestones have to be celebrated.
A Well-Managed Overhead
Liquidity is essential for a small business to succeed, and the majority of small business owners know this. However, it can often be difficult to keep a suitably sized reserve to cover the cost of emergencies. To keep a sizeable reserve, small businesses have to manage their overhead effectively. In some cases, this may involve transitioning into a remote business, meaning there’s no rent to pay. Alternatively, automating tasks with intuitive software can be cheaper than hiring staff to tackle the same tasks.
Accurate Record Keeping
Successful businesses have to know where their current financial position is at all times, which often involves looking back over historical spending and sales. Therefore, accurate bookkeeping is an essential part of small business success. As well as allowing a business to draw insights from historical data, accurate record-keeping will help when it comes to filing taxes.
Even though accurate record-keeping is a quality of success, not every small business owner is good at it. Therefore, tasks like financial tracking can be outsourced to an accountant, which can provide the essential information in a digestible format.
Patience, Determination, and Focus
Running a small business is challenging, and there will be days when failure feels like the best option. To get through the dark days, entrepreneurs need to stay grounded and focused on their overall goals. Additionally, a little patience will help, especially if things aren’t going quite according to the plan. If you’re on the edge of collapse and you can safely say that you’ve done everything in your power to survive, at least you can hold your head up high.
Achieving success as a small business is challenging, especially when so many of them crash and burn within the first five years. Although adopting and mastering the qualities outlined above doesn’t guarantee success, doing so will help avoid becoming another failure statistic.