The Challenges of Starting a Small Business
Why do you want to start your own business?
Do you dream of getting rich?
Do you crave the freedom to make your own decisions without having to ask your boss first?
Do you want to be able to choose when you work and when you don’t?
Do you want all of the above!
The fact is, the chances of you ever achieving any of these goals are very, very slim.
'50% of new businesses are closed within 3 years'
If you are one of the 50% that survive beyond the initial years, only a handful of you will make significant money, and even fewer of you will experience any type of freedom.
Have I put you off yet?
The key to small business success is setting up your business the right way from day one. 95% of owners get it wrong.
Think about your reasons for starting up your own business for a moment?
If one reason is to make a lot of money what is the one thing you simply should not do? It’s a crucial mistake that most new start-ups make?
It’s to compete on price! The majority of small business owners under charge for their products or services, in order to bring in new business. Why would you do this? Why would you think this is a good idea? You’ll never get rich working for small margins! Leave that strategy to Walmart and Asda, or other national chains such as Poundland who have the volumes and purchasing power to buy at incredibly discounted prices.
Focus on positioning your business as a premium supplier based on the high standard of service you provide.
For example look at all of the low end cafes and restaurants that come and go on a regular basis. They aim at the low end of the food market and make such low margins that is just isn’t worth their while to continue; the effort just does not justify the rewards.
Yet whilst these lower quality restaurants come and go, the higher end establishments stick around for years; the margins they charge make all the effort more than worthwhile! The experience they give their diners makes them keen to come back on a regular basis.
And in times of recession, who are usually hit the hardest? It’s the lower paid usually as unemployment increases and the cost of living increases. However the wealthy tend to still be able to afford their luxuries!
High quality, expertise and specialisation earn loyalty and generate positive word of mouth. Both are priceless.
Therefore develop your business model from day one to allow you to charge as much as possible for your time and products. Don’t be afraid to charge more.
The other reason for starting a new business is the freedom that its meant to bring you. This brings us to my next point. If you want freedom, why would you build a business solely around your expertise?
So many small businesses simply cannot operate for any period of time without the owner! Surely this defeats the object of the exercise? You have to set up your business so that it can grow without you. You need to put the systems in place that will allow you to take a less hands on role as your sales increase. If the business depends on you, then there is a limit to what you can achieve.
Your goal should be to grow the business to a point where others do the daily work; your role is to guide the direction the business takes. That way you can have your freedom and grow a much more valuable asset that can be sold without you.
To learn more about pricing strategies; positioning your business for maximum profits and the business systems you must put in place from day 1, grab my new guide "The REAL SECRET to Small Business Success" and start making more money tomorrow ... literally! And if you like what you read, take a look at my DIY Marketing Blueprint it's my premium training product specifically written to help small business owners, you'll avoid the costly mistakes that 95% of new owners make and greatly reduce the challenges of starting your own small business.