5 Tips On How to Become a Successful Small Business

No one starts a small business wanting it to fail. But according various statistical sources, such as the Small Business Association (SBA), more than half of new small businesses will not make it past five years. So how can you avoid falling prey to this statistic? Here are the most essential five tips you should keep in mind to run a successful small business with longevity:

1. Do you know what your target market wants? If you can not answer this question, then you have a big problem. The first tip to running a successful business is becoming intimately familiar with the unique makeup, behaviors, and attitudes of your core customer-base. Thanks to the Internet, getting this information these days has become relatively easy and low-cost. You can ask your target market what they want via social media platforms or online surveys. You can also consult available market research data from government sources, research organizations, and other companies.

2. What do you do exactly? Tip two to running your business successfully involves clearly defining your niche. If you do not know what you do differently than the other businesses or websites competing for market share, then you can end up confusing your customers, confusing yourself, and dropping core competencies

3. Do you know who is working for you? Are you tapping into the potential of your employees? Tip number three for a successful business involves the active recognition that your employees are one of your biggest assets. I can not stress this enough. Your employees may work on the front lines with your customers; they may be involved day-to-day with your business’ equipment, supplies, and processes; they come, each one with his or her own unique background, knowledge, and experiences. Doing what you can to make your employees feel valued, helping them stay motivated, and actively asking them for feedback will positively affect the way you do business, leading to increased efficiency and higher revenues.

4. Who do you know? With the virtual explosion of the Internet, mobile technology, and social networking, these days there is a direct relationship between being connected to other businesses and professionals and running a successful operation. If you operate on an island, you are cutting yourself off from any number of lucrative business arrangements as well as vital business or industry-related information. A well-established reputation and network of businesses and professionals will also add value to your business.

5. Where’s the money going? My last tip to becoming a successful business is a pretty standard one: learn how to manage the money in your business, get tools to help you do it better, and if you have a hard time with this, then hire someone else to do it for you. Cash flow is the gas on which your business runs and the lack thereof has claimed the lives of many a small operation. You should have a basic awareness of your business’ accounting system, and be familiar with the overall meaning and key elements of the major financial reports, such as a cash flow statement, balance sheet, budget, and income statement.

Bottom line: if you want to become a successful small business owner, then take these five tips to heart. Without them, you will likely end up on the wrong side of the business failure rate.

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