Owning your own business may seem like a risky venture, especially when you’re first starting out. The risk of going under is higher before you’re well established. Fortunately, there are some things you can do to make your business more stable. Laying a stable foundation for your business to grow from decreases your risk and will lead to greater success. So how do you do this?
A Plan
Start with coming up with a plan for your business. What is your vision for your business? What do you hope to achieve both in the short-term as well as long-term? Both short-term and long-term goals are important to a business’s success. They provide direction, with the short-term goals feeding into and leading up to achieving the long-term goals. A good plan should list business goals and how they are going to be achieved. It should provide structure and be the roadmap a business follows as it grows and expands.
A Loyal Customer Base
A business can’t survive without consumer support. As such, a loyal customer base is absolutely critical to business stability. A loyal customer base is developed by building customer relationships through exceptional customer service. It’s also important to have a clear, consistent company brand. This means consistent use of color, styling, and design, which helps people more easily recognize your brand. This consistency can also help imbue your business with a sense of trustworthiness and stability, as customers will identify your business as one that is uniform and dependable. This can result in as much as a 33% improvement in revenue.
Profitability
Your business’s ability to turn a profit is an obvious requirement for success. Your business should be structured in such a way that the cost of doing business is less than what it brings in. The cost of doing business includes factors such as overhead costs, employee pay, and the purchase of goods and supplies. It’s important to take these costs into consideration when pricing your products or services. They will impact your profit margin. You can help improve your profit margin by controlling these costs where you can and improving both procedural and employee efficiency. A wisely frugal and efficient business is more likely to be profitable and stable.
Cash on Hand
Some businesses do well in a recession, but for most small businesses, recessions can be dangerous times. Having cash on hand or saved in a business account can provide your business with an added level of stability. It provides you with a cushion to fall back on during hard times. To figure out how much money you should have saved up, consider what your monthly expenses look like. Dividing what you have saved by the amount of your monthly expenses will give you an idea of how long your business can last on just your savings. Think about the market and industry you operate in. Is it a stable one or is it prone to being more volatile? Depending on the answer, you might be fine with just saving up a couple of months worth of income, or you might need to set aside half a year’s worth.
Marketing
Marketing is a business’s best way to attract new customers. There are a myriad of marketing methods, each with their own pros and cons, but one of the main principles of marketing is the need to go to where your audience is in order to reach them. Especially now, with online shopping becoming the go-to more and more, digital marketing is taking on an increasingly important role. It’s necessary for businesses to successfully execute digital marketing strategies in order to attract new online customers, a hefty order when you consider how quickly snap judgements are made about your business and its products. There are simple steps to improve your digital marketing efforts. By improving your digital marketing, you improve your ability to attract and retain customers, leading to improved stability for your business.
Company Values
Company values color many aspects of a business. They influence company culture and create a sense of purpose and unity. They can help guide a business’s direction and the focus of company goals. Employees will feel better about coming to work for a company whose values align with their own. Similarly, a company’s values and position on various social issues is enough for a majority of consumers to decide whether or not to support them. Company values are not something to be taken lightly. They should be formed through careful thought and consideration. Both values and your business gain a sense of authenticity when those values become ingrained and an obvious part of your business.
Great Employees
Your employees can make or break your company. This is true for every level of employee, from those in entry level positions all the way up through the C suite. It’s important for employees to be honest, hardworking, and efficient. Retaining quality employees provides stability for a business. This allows teams to gel and become more efficient. Employees who have worked together for a long time are familiar with the strengths and weaknesses of one another and know how to work well together. They know how to rely on one another and what to expect from one another. This provides a stable base for business operations.
Choose Partners Wisely
Similar to reasons why it’s beneficial to retain employees, it’s also wise to choose your business partners carefully. The consequences of choosing a bad business partner can be devastating. Bad ones have the potential to ruin both your business and your good name. On the other hand, choosing a good business partner can be what takes your business to the next level. They may have different expertise and resources which can be of benefit to your business and provide greater support to it and to you.
Investing in your business’s personnel, marketing, and various aspects of its structure are important to creating greater stability for your business. Having a stable business increases your chances of surviving difficult circumstances and economic crises. Take the time to lay a stable foundation for your business if you’re getting started, or shore up your foundation if it’s lacking.
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