People who want to get rich overnight usually don’t get how things work in the business world. You see, it isn’t that hard to trick people into paying for your product/service once. The greater problem is to persuade them to keep paying you continuously. Naturally, these things take time, so in order to help you, here are a few tips on how to plan a steady growth for your startup.
Cost-Profit Ratio
The key to making money is to earn more than you spend. Still, this is not nearly as simple as it sounds. At times, you will be selling a product you are making yourself. However, this product takes some resources to make and these resources are not free. Then, you need to think about wages. Either you are paying someone else to do this for you, or you are making it on your own (one-person home-businesses). Even with the latter, you need to understand that time is money. In other situations, you will be reselling goods you get from a supplier and in this case, you will have a price you are getting the goods at.
The reason why we listed all of these is to show you that sometimes, your prices won’t be able to go lower than those of your competitors for practical reasons. Your competition may be able to manufacture these goods cheaper, or get a better price (due to a different supplier or a better quantity-discount). Discounts and limited-time offers can only go so low, but once you start selling under what it costs you to produce/buy, you are losing money. This is why you need to do a proper research on the market long before you set foot into this corporate battlefield.
Do Your Books Right
How important is it exactly to keep your books clean? Well, remember Al Capone? His crime gang raked in over $100 million each year. He ordered murders, kidnappings and extortions. In the end, he was convicted for none of these things, but tax evasion instead. So, if having dirty books was enough to bring down one of the greatest criminal organizations in recorded history, imagine what it could do to a young company that just started on its path towards glory.
The worst part is that sometimes these accounting errors aren’t caused by the foul intentions, but by the sheer inexperience. Needless to say, this is something best left to professionals, which is why you may want to look for someone who offers financial services to help you out.
Having an Emergency Fund
One of the greatest mistakes that most startups make is betting all they have on the launch. Still, you never know when you will need that extra dollar to patch up a hole somewhere down the line. Because of this, it is vital that you have an emergency fund or at least a way to obtain this kind of resources at a short notice. Sometimes, this will mean building up your credit score in advance, at others it will be having an asset to sell if the situation becomes that desperate.
Build a Strong Online Presence
Later on, when you become a brand, you can rely on the word about your business spreading on its own. For the time being however, you need to make sure that the right crowd finds you. This means profiling your audience via Google Analytics and similar tools and then using suitable SEO methods to make yourself visible to them. All is fair in love and war, and as we already said, the modern business world is no short of a battlefield. This usually means that you will probably need to shamelessly self-promote your business via social media and the blogosphere, as two most cost-effective methods, but it also employs some other techniques.
Conclusion
Planning a steady growth for your startup is an art and if everyone could do it, there wouldn’t be a 90 percent failure ratio of all new businesses. Still, seeing how unprepared some people walk into their first enterprise, it is a wonder that this figure isn’t even higher. Be that as it may, there is no way to guarantee a 100 percent success, but following the abovementioned tips can significantly improve your chances. It may not seem as much, but it can definitely make a difference where it counts.
Dan Radak is a marketing professional with ten years of experience. He is a coauthor on several websites and regular contributor to BizzMark Blog and Times of Startups. Currently, he is working with a number of companies in the field of digital marketing, closely collaborating with a couple of e-commerce companies.
