Starting a business does not guarantee immediate success. Research has showed that more than 90% of the newly established businesses fail to flourish in their early stages. New businesses are faced with a lot of uncertainties. If entrepreneurs are not well prepared to handle these hiccups, there are higher chances that their business will not succeed. What does it take to have a successful business? Well, this is a question that every businessperson should ask before venturing into any business.
The following are key factors that determine a new business success or failure.
1. A Feasible Business Idea
Having a viable business idea is major pillar of business success. Although this is not enough as you need to market your idea and make it more profitable. Business ideas can be sourced from identifying what people want, become a problem solver by selling that product or service that is in high demand. You should also employ proper mechanism that will ensure that your business can withstand the pressure from competitors who may be offering a similar service or product.
Consider writing a business plan as it will form a major framework that can determine the viability of your business. It will help you establish a comprehensive market analysis and consumer preference research before you implement your idea.
Capital is very crucial and it forms a significance percentage of business success. For any business to start, initial capital is a mandatory factor. Although some small businesses are not capital intensive, you need to establish a clear financial plan. Many businesses fail to succeed as entrepreneurs expect to make profits in their initial stages of business operations which might not be the case.
It also important to understand that adequate capital with poor management will also contribute to a business failure. In order to have a successful business, you should put measures in place to ensure that capital is invested in the right projects that will benefit the business. To avoid falling in this trap, always employ the right personnel who have financial management background.
3. Customer Loyalty
Customer satisfaction is the main factor that determines business success. Establishing a good relationship with your customers can guarantee you positive business feed backs. To win continued customer loyalty, your business must act with high integrity by providing quality products and services. Customers are the king and you should always aim to make profit through improved customer satisfaction.
When starting a business either as a sole proprietor or a group, proper leadership is required. The overall leader is charged with the responsibility of controlling all the functions of the business. Having the right team with a common mindset of success enables the business to boom really fast. This has been a major challenge and it can lead to a major downfall even if the business idea is viable.
Working with the right team ensure that all departments coordinate well and they are all dedicated towards achieving a common goal. In order to execute you plans effectively, consider formulating both internal and external teams.