Anyone bold enough to start a business will tell you: it takes a village to run a business smoothly. Intense competition, limited resources, and lack of brand awareness are just a few of the challenges that owners think about every day. Yet somehow, the best teams work through these obstacles and distractions, tap into something greater, and deliver the products and services we have come to love.
So what can be learned from these titans of business? How have they risen above the crop and found success? Even though we can’t share the secret formula for building successful businesses, we can, however, explore the ingredients that go into one.
Tips for Small Business Success
Each business is built different and walks a unique path, but the essential elements for entrepreneurial success stay the same. Here are a few of the most important tenets to remember.
Prioritize sustainability over hypergrowth – Silicon Valley fables of overnight success and fame have become as cherished as the American dream, but the reality is that only a lucky few will ever see this level of growth. It’s never worth betting your assets on speculative trends and fads. Slow but positive progress will always beat rushed, unstable growth.
Maintain control over finances – No matter the product or service offering, every business has the same goal at the end of the quarter: to produce a profit. That may involve driving up revenue or keeping costs low or both. The companies that spend the time and attention to tracking their finances and not allowing expenses to skyrocket or revenues to fall will have more breathing room within their strategy.
Experiment often – It’s easy for a business to become stuck in its ways, but experimentation is key to innovation. Some of the best inventions have come out of the research and development sectors of a company. For example, the modern PC, laser printing, and Ethernet were all invented in Xerox’s Palo Alto Research Center (PARC). Develop experiments within your own business and niche. What business theories do you want to put to the test?
Understand your customer – A business is just an idea until you have your first customer. Reinvest your revenue in marketing efforts that truly understand, reach and engage your ideal audience. As Walmart founder Sam Walton puts it, “ There is only one boss. The customer. And he can fire everybody in the company from the chairman on down simply by spending his money somewhere else.” The more you prioritize your customer, the more it will pay dividends for your business down the line.
Characteristics of Successful Business Owners
Drive to succeed – Think of any modern-day business owner and you’ll see that they all have something in common: tenacity. Despite the odds stacked against them, they continue to persevere. The belief in something greater than themselves pushes them to do bold things and chase after their dreams.
Open to change – From handling accounting to selling customers on a new product, business owners wear so many different hats in a day that it can quickly become overwhelming. If a business owner is rigid in his ways, then he can become stuck, focusing too much on a single task. Being fluid and open to change allows one to more easily navigate the challenges of running a business.
Budget-conscious – Business owners are seldom spendthrifts. Even when they may be wealthy, they think deeply about how they invest their money. It makes sense— after all, business owners are their own accountants and financiers during the start of the business. Saving money and cutting costs is how businesses survive early on.
Risk-taker – It can take a particularly daring person to start a business. No assurance of steady income, volatile markets, perishable goods… any rational person would see that starting a business is in many ways a gamble. But business owners also see that the potential rewards from the hard work make the risks well worth it.
Resilient – Business owners are no stranger to adversity: whether it comes in the form of a recession or a failed product launch. Either way, they don’t wallow in self-pity, instead they pick up the pieces and soldier on. Failure becomes less of a concern, and more of a momentary learning opportunity worth embracing.
Authentic – Customers can be perceptive, and they can tell an authentic story from a phony one. The same can be said with the leaders of these companies. If a business owner tries to fake his way through business partnerships and major projects, it affects the mentality of everyone involved.
Confident – In such a competitive field, confidence can be like battle armor. It guards one against the pitfalls of self-doubt and overthinking. It can also empower teams to finish grand undertakings like finishing a product or releasing a new version of software. It was confidence that inspired Ford and his team to accomplish the first V8 engine, something that was previously thought impossible.
Goal-oriented – Having goals and objectives ensures that a business’s actions are always grounded with purpose. Business owners and leaders should ask themselves, “what are we working towards?” Even for a big project like a new website or a new product offering, leaders will break up the project in terms of milestones and goals. Using the SMART system will ensure more relevant and consistently-completed goals.
Self-motivated – Finally, business owners are able to harness energy from deep within themselves to accomplish their goals. Sales may be down, the competition may be fierce, but when things get tough, business owners will always find their own sense of encouragement to carry on towards success.
Small Business Branding
With so much competition in every industry, business owners must focus on effective marketing strategies to stand out, including relevant and consistent branding.
Branding begins with the value proposition, a unique selling point. Ask your team and yourself: “why should anybody buy from us?” Analyze other brands and what makes them effective. People buy from Amazon because it is fast and convenient, and from Whole Foods because they offer healthy food options. Identify the quality (or qualities) that separate your business from the competition.
Build relationships with suppliers and vendors. After all, these two parties are responsible for providing and distributing your offerings. Cultivate these relationships and you may see an advantage in how your product stacks up against competitors.
Ask for genuine customer feedback. Send out surveys or ask questions through social media to gauge how your customers feel about your offerings. It may be painful to read or hear, but they will inform you about what to focus on and help you learn from your mistakes.
What Not to Do When Running a Small Business
We’ve covered at length the practices and qualities that lead to success. But what about the practices worth avoiding?
For starters, business owners and their teams should get comfortable with being uncomfortable. If you want to play it safe, no one is stopping you— in fact, your competitors would love for you to play it safe! Take risky experiments (without betting too much). Explore potential verticals and collaborations. Your business will only benefit from thinking outside the box.
Another point to consider is your own business relationships. Never treat a genuine relationship like a business transaction. Rushing a business partnership is a surefire way to ruin your business’s potential. Take the time to get to know other experts within your niche. Create trades of information, nurture business relationships for the long-term, and the resulting collaboration will end up serving everyone.
One of the most important things to remember: never ignore customer feedback. These are the people patronizing your business and ensuring your livelihood! Whether it’s a small complaint about the website or a much larger issue within the business, customers will determine your business’s future, so it’s a good idea to acknowledge each and every customer’s feelings and pass it along to the teams who are most empowered to do something about their concerns.
Similarly, never ignore the business competition. If you’re not careful, others may try to steal your ideas, or come out with vastly superior alternatives. Study your competition as if your life depended on it. Even though you have competing interests, you always have something to learn from your industry peers.
We’ve still only scratched the surface of what makes a business successful. It’s no wonder that there’s a whole subgenre of books and college courses dedicated to the topic. Yet even with all the theory and studying in the world, nothing will quite prepare you for running a business quite like real, hands-on experience. The best way to build a successful business is to simply build it and learn from failure. Success then becomes something subjective. In other words, only you can really know for your own business what success looks like.