According to the National Business Incubator Association, 80 percent of small businesses fail within the first year. Needless to say, this statistic proves that your business will need every advantage possible to succeed. However, trying to determine what those advantages are can be tricky at best, especially in today’s competitive business world. But if you’re determined to forge ahead with your million-dollar idea and want to know how your startup can compete and succeed, here are five advantages you’ll want to have from the outset.
A Strong Customer Base
If you’ve identified an unmet need for customers, it’s imperative that you have a strong customer base to tap into with your idea. However, make sure your idea taps into a market that matches your abilities. For best results, focus on servicing a lifestyle niche, since lifestyle businesses generally cost less to start and have less chance of being pushed aside by other competitors.
Have a Simple Product
By staying laser-focused on meeting that unmet need of your customers, you’ll be able to create a product or service that stays as simple as possible. For many businesses that fail, one of the biggest reasons why is trying to add too many features to their products or services, which ultimately confuses customers and stretches the company’s resources too thin.
Skills and Education
While many successful business owners never attend college, more and more of today’s entrepreneurs now consider an MBA more important than ever. Not only will it give you a chance to learn about the business world from experienced professors, many of whom were successful business owners themselves, but it will also give you a wealth of knowledge that can serve you well decade after decade. A traditional degree might not be necessary to start or grow your business, but having high-quality MBA and relevant understanding of the industry will be invaluable in building a sustained competitive advantage in cutthroat markets.
In business, timing is everything. And since every opportunity has a limited window of time to succeed, you’ll need to strike fast. Rather than focusing on an unproven market, it’s best to adopt a “fast-follower” strategy, where you identify a new interest that’s just starting, enabling you to get in on the ground floor.
Bootstrapping a business (or organic growth) is widely considered the most healthy and sustainable way to grow a startup – if not necessarily the fastest. This method forces you to prove your business model in the marketplace before you start throwing serious money after it. Debt resulting from SBA loans choke your cash flow and increase your risk, and partnerships often create difficult management dynamics that can prove toxic to business growth. Be sure to minimize risks and costs as much as possible, and weigh them against the potential for returns.
By ensuring your startup has these and other advantages from the outset, the sky is the limit when it comes to your business succeeding.