The key to success when starting up a new company
When starting a new company, there are many unknowns. In fact, whilst 2017 saw a total of 381,885 new businesses launched in the UK, statistics show that 328,000 businesses were closed the previous year.
Launching a new business is hard. Keeping it going is even more difficult. Most businesses don't make it to their third year. So, what's the key to success when starting up a new company?
- Invest where it matters
As a new business start-up, every penny is precious. This means that you'll need to know when to spend money, and what you don't need to invest in.
A professional business logo is a valuable investment, for example. A brand new office, unless you've got visiting clients to make an impression on, usually is not. See if you can work from home initially, or find a cheap shared office space at a fraction of the cost.
- Grow slowly
Many people start a new company with the aim of growing big. That kind of passion is admirable, but can also become your biggest flaw.
If you grow your business too quickly, you may run into trouble. If you take on too many employees you'll struggle when times are tough. And if you expand to a second property, you may quickly realise that you can't afford the rent for both.
Don't rush forward when things are looking positive. Take your time, look for long-term trends and act with confidence when the time is right.
- Protect yourself
The right small business insurance is absolutely necessary, for the protection of your business and your customers. Nobody wants to be sued for giving incorrect advice or for an injury on their premises. And very few people can afford extensive repairs in the event of damage to their shop, or theft of their property.
By investing in the correct business insurance, you can make sure that you don't need to worry about unexpected financial outlays, and can focus on surviving and growing your business.
- Record everything
Records are absolutely crucial. They can be called upon as evidence if you're taken to court, or if HMRC want details for your tax returns, but they're also important for you.
Records allow you to analyse your business, to see what's working and what's not. They'll be essential from the moment you launch your new company to the very height of its success.
- Know the competition
No company is completely new and unlike any other. Your company has competitors, and it's your job to know everything about them. Learn from their successes, and from their failures, to help you rise to the top.
Competitor analysis is not something that you do once when launching your business. It's an ongoing process that'll have ever-changing goals and results. New competitors may appear at any time, paths may change and your goals may shift and evolve. Ensure that you always know what's going on around you, even once you're feeling confident that what you're doing is working.
- Focus on customer service
People buy products and services. But, far more importantly, they buy the people behind them. Providing good customer service helps your business grow. But people will be quick to go elsewhere if they receive a sub-par service.
Investing in (and focusing on) good service will benefit your company. Get to know your customers, their needs and wishes, then do all that you can to turn their dreams into reality.
If something goes wrong, own up to it. Admit to your own flaws, and show your customers that you'll do better. More than ever, customers are relying on honesty.
People are no longer loyal to companies or brands. If something isn't working for them, then they will happily go elsewhere. But, if you get this crucial element right, it could be your biggest key to success. In fact, a 2019 study found that 86% of people would pay more for better customer service. The service you provide could be what differentiates you from your competitors, even if their offering is cheaper.
To make your new company successful, you must be prepared to provide a top customer service experience. Active and engaged customers will support your business, and can even provide the feedback that will help you to shape and mould it.
The key to success when starting up a new company is not to look for one key. In fact, many elements connect together to make a company successful.
By Ross Hanson, Digital Media Consultant, Hansen Ross Media
- What I wishes I'd known before I set out, Ian Hills, Purple Pilchard
- Realising your vision for growth, Barry Leahey MBE, Playdale Playgrounds
- Starting a business from scratch: Busting 7 mistakes and misconceptions, Lewis Bowen, AIR, and Sheffield Business School