Stats show that a massive 90% of business start-ups are destined to fail. While you might be one of the 10% with a great idea that takes off immediately, but what should everyone else do?
At Turner Little, we work with start-ups all the time and have learned the best ways for small and medium companies can launch and survive. Here are three of our tips for start-up survival.
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Always be ready to change
The most fundamentally important attitude you should have as a start-up is flexibility and a willingness to change. Sometimes, a change means a big shift in business strategy, but it doesn’t always need to be dramatic. It could be something as simple as including an extra revenue model or altering sales platforms.
Every business sector and surrounding market is constantly evolving. Customers and technology change all the time, and start-ups simply can’t sit still. If you’re not one step ahead of these changes then you could be at risk of being left behind.
Before you launch your start-up, work out ways in which the business could change or pivot. With sufficient market research and a thorough understanding of your customer base and market, you should be in a position to plan ahead for possible scenarios. If you are willing and ready to pivot you will find that you might be able to add lucrative revenue streams, or even launch a whole new side to your business.
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Treat your cashflow like it’s vital
Cashflow is at the heart of your business survival. You must always balance the books, make sure cash is in your business account and move towards at least breaking even at all times. Focusing on making profit will keep you sharp and ahead of the game.
Don’t take on too much money up front by valuing your company and product too highly. If you get carried away with hype, then you could come crashing down. Boom or bust should not be your business ethos!
Run your business frugally, with an eye on expenses and running costs. Keep to your initial forecasts and make sure turnover covers this – and more. Concentrate on building a solid business that remains viable over the long-term. When you start turning a profit you can start taking a few more risks. This could involve judicious investment to help your business move to the next level.
Start-up owners have the ultimate responsibility towards not only their investors, but also their team. There must be enough money to pay wages and keep the business going. You may find that pivots are key to this, as you can alter the way you are paid to ensure more cash up front, for example.
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Work with your team – always
Picking a good team is vitally important for the health and growth of your business. It’s not just about choosing the right kinds of people to invest in your company, but also showing trust in them by delegating responsibility.
Founders of small businesses can’t and shouldn’t try and do everything themselves. It’s a sure-fire way towards failure. Use the skills base of your team intelligently and trust your own instincts in choosing them in the first place.
Investing into staff resources and allowing them a certain amount of autonomy gives them ownership of their part in the business’ success, and also an important feeling of being trusted and allowed to be independent. It will also free up your time to focus on the company growth and overall strategy of the business, rather than running it on a day-to-day basis.
If you get the team right from the beginning, then you will end up with a team of people who care about and believe in your business as much as you do. Consider hiring on personality and potential, as well as qualifications as being a team player is just as important.
About Turner Little
Founded in 1998 in Yorkshire, UK, Turner Little is a specialist UK and offshore company formation, banking and corporate services provider. Our services include company formation, UK and offshore banking, asset protection, credit correction/repair, trademarking and trusts. Other services include Internet services, mail forwarding, wills and probate. Turner Little’s vision is to offer the best possible service, together with market leading products.
