Business Lessons Iíve Learned As a Small-Business CEO
The numbers that caught my eye had to do with start-up business failures. Did you know 25 percent of start-ups strike out within the first year? Thirty-six go down in the second, and 44 percent in the third. Nearly three-quarters of businesses that start in one year will be shuttered 10 years later.
Why? “Incompetence” is the No. 1 reason, according to Statistic
Brain. My fun new website cites specific pitfalls including “living too high for the business,” “lack of planning” and – this one’s a doozy – “non-payment of taxes!”
• Be flexible when building your team. You hired Person A to do Job A, but as you get to know him, you find he has talents and skills better suited to another job – possibly even a job you haven’t identified! Be open to switching things up.
• Don’t spend more than you make. It may sound like a no-brainer, but based on Statistic Brain’s numbers, far too many people make that deadly mistake. If your product or service isn’t earning enough to pay the bills, it may be time to re-evaluate what you’re offering. Is there a demand for it? Is it a quality product or service?
• If you borrow, invest it in the company. If you’re going to draw a salary from that money, don’t be tempted to take more than you absolutely need to survive. If your lifestyle is a little uncomfortable, you will be far more motivated to do whatever it takes to make your business thrive.
• Don’t allow marketing to fall by the wayside. One of the most important components of any business plan is its marketing strategy. Too often, people don’t think that through with the same rigor they tackle concerns like projected cash flow and long-term goals. Or, they do put thought and effort into planning for market research, promotion and positioning – and then never follow through.
Marketing is the engine that drives your business; it’s what generates the leads that become the sales, which sets the rest of your company’s machinery in motion. Without it, you can’t sustain and grow your customer base. Marketing is multi-pronged. It includes branding and positioning your business to distinguish it from your competitors. When things are going well, don’t make the mistake of deciding, “I don’t need to market any more!”
Finally, surround yourself with great people and treat them, and your customers, with genuine caring. You’ll be surprised by the number of problems that can solve.