It’s no secret that most businesses fail in their first year. If you’re a small business owner just starting out, you could probably go the rest of your life without ever hearing that fact again. But it remains a truth that must be considered. Otherwise, you’re allowing yourself to walk into a minefield with no effort to determine where and where not to step.
The threats facing a small business vary depending on several factors. With this in mind, we can’t offer much in the way of what to avoid. However, we can provide several tips for how to navigate the months ahead without it culminating with a “Going out of business” sign on the front door.
With this in mind, let’s dive into six pieces of advice for surviving your first year in business:
Examine the competition
What are you up against? If you don’t know the answer, then how can you expect to succeed when things don’t go your way? Take time to study your competition as much as possible. Scrutinize their marketing, analyze their prices, probe their service, and do anything else you can to understand and appreciate their success. Your findings will lead to an improved understanding of how to turn your startup into a success. It may also reveal certain ways you can provide a superior product or service.
Form a solid business plan
There’s no legal requirement to have a business plan before launching a business. However, you won’t get far with banks and other lending institutions. You’ll also be putting yourself at an extreme disadvantage if you don’t take the time to formulate a solid business plan. Anyone can write a glorified book report about their venture; a good business plan provides a realistic roadmap from concept to profit. If your business plan lacks the substance needed to provide a guiding light in the months ahead, step back, consider the existing version a rough draft, and begin ironing it out until you’ve got a blueprint for how to run your business.
Prepare to pivot
The first year in business is almost guaranteed to be a learning process. With this in mind, small business owners looking to make it will need to consider the possibility of making changes along the way. Pivoting is not a sign of weakness. In fact, it’s a demonstration of acumen. A willingness to adjust your operation in order to better meet market demands is more likely to lead to success than simply refusing to change out of stubbornness.
Consider hiring a consultant
Most small business owners are experts and specialists regarding a niche product or service. For instance, a bakery shop owner is an expert in baking but probably less skilled in accounting, hiring, and other practical aspects of running a business. With this in mind, consider hiring an outside consultant. A B2B market research agency can help you find the qualified professionals needed to provide useful insights and offer their expertise. While hiring a consultant might sound like an unnecessary expense – especially in your first year in business – it’s bound to be a better alternative to closing up shop because you lack the wherewithal to master the ins and outs of the business.
It goes without saying, but it needs to be said anyways. A small business rises and falls with its owner. While hard work isn’t enough to make a small business thrive, it’s virtually impossible for a small business to make it beyond the first year if the owner is aloof and underachieving. You’ve got to put your blood, sweat, and tears into your venture. Doing so not only puts you in the best situation for success but also sets an example for everyone else on your payroll.
Invest in marketing
It’s hard to get customers if the customers don’t know you exist. With this in mind, investing in marketing is essential for small businesses trying to make it past their first year. While it might take a decent chunk out of your budget, clever marketing will lead to increased sales.
The unfortunate truth is most small businesses never make it past their first year. But it’s not inevitable. There are ways for small business owners to maximize their chances of success so that they surpass one year and continue to thrive for years to come.
Julie Steinbeck is a freelance writer from Florida. She enjoys covering topics related to business, finance, and travel.