What are the reasons a business succeeds?
One of the sad realities of business is that only a small percentage of all startups succeed. On average, only 1 out of 10 new businesses survive. About 50% of businesses fail due to incompetent management. Starting a company is a risky business. Entrepreneurs face obstacles at every turn. We all know there are plenty of reasons why businesses fail, but what are the reasons they succeed?
By examining successful companies, we gathered the following reasons businesses succeed:
Every startup needs a leader with a vision. As a business leader, you must know where you are and where you are heading. You need a clear direction to move your company forward. You can’t there unless you know where you are going. Every day, you have to remind yourself of the big picture. A good business leader keeps the long-term in mind while dealing with the immediate needs of a new company.
To keep your business moving in the right direction, ask yourself the following questions:
- Do I have a clear definition of the direction of my business?
- Have I created a business plan that I and my team can follow?
- What have I done today to move my business in the right direction?
- What distractions did I have to deal with today?
- What can I do to minimize distractions from the ultimate goal?
- Did I succeed in motivating my team to reach our goals?
2) Speed to Market
You can’t be second if you want to dominate the market. If you are slow to market, you allow your competition to dominate the market. Especially with the rate of technology development, the faster a startup can produce its service or product, the better chance it has in delivering to customers. Companies that are slow to market have to compete with established industries. One of the reasons businesses succeed is that they reach consumers first.
The fastest companies to market have the best access to customers. Customers are more likely to talk to you if you are first to market. If you are late to the market, customers and prospects have already talked to your competition. It is tough for latecomers to steal customers from established businesses.
The first companies to market can easily dominate the market. It’s much easier to dominate a market without competitors. If you are first to market, you are more likely to succeed, even if your product or service is substandard.
If you are first to market, you will become an industry leader. Instead of competing with other businesses already in the market, you can set industry standards.
3) Financial Savvy
Successful businesses understand the importance of financials. Managing finances and keeping a young company out of debt it can’t repay is key to becoming successful. Companies just starting out need to do more with less.
Just like early career builders, young startup companies can gain a leg up by knowing a few well-connected individuals. These companies use their social network for their first clients, investors, and mentors. As the adage goes, it’s not what you know – it’s who you know.
Startups need leaders who are willing to work hard and stick to their goals. This leadership inspires others to commit to a strict work-ethic, aligned with the company’s mission. All employees must be engaged and dedicated to the goal.
Even when times get tough, and the road to success offers bumps and blockages, startups need to persevere to achieve success. The majority of startups bail when money is tight or disagreements arise between founders. Successful businesses stick it out in turbulent waters and remember their end goal during difficult times.
7) Quick to Adapt
Successful startups are comfortable with change. Leaders who know how to make smart decisions without a clear roadmap can take advantage of opportunities that more cautious companies can miss.
8) Knowing How to Attract Investors
Money talks in the business world. Without the startup funds, companies can never get up off their feet. Smart business leaders know how to generate capital to give their million-dollar ideas a shot.
Startups need an unwavering commitment to their mission and goals. Without the confidence that the company will succeed, the startup will dissolve when facing initial obstacles.
10) Efficient Time Managers
There’s no downtime when it comes to startups. If the leaders of a company are not putting in time around the clock, success is unlikely.
Everyone can have a million-dollar idea. It takes moxie and strategy to put an idea into action. Knowing how to execute sets apart successful businesses from the failures.
12) Exceptional Product or Service
Every business claims to have something special for the market. In reality, only a tiny percentage of businesses offer something truly unique. Great marketing is not what gets people to buy. If you are going to succeed, you have to figure out a way to consistently provide exceptional products or services.