How to Avoid Business Failure

Chris

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Starting a business requires a big dose of boldness. It can be a scary thing, but it can also be one of the most rewarding experiences of your life.

If you’re focused, organized and strategic about your actions, you’re well on your way to success. But, of course, business failure is all too common, so you need to be aware of the pitfalls to watch out for.

Whether you’re thinking of starting a business or you’re already on the entrepreneurial journey, in this blog post, I’ll share 8 vital tips to increase your customer base, revenue, and profits (and minimize the risk of business failure).

1. Carry out market research
Market research helps to validate an idea before execution. One of the biggest factors to consider is the viability of your proposed business.

Is there a market for the business? Are there other businesses meeting the same needs? If there are other businesses, do you have a unique approach to gain market share?

With market research, you’ll understand whether there’s a potential for your business or if you’re better off trying out something different. In fact, in some cases, market research can even help you identify better opportunities for yourself and your business.

Another big benefit of performing market research from the start is that it’ll help you understand your target audience better. Where they spend their time online, what topics interest them, what influencers they follow, what they have to say about potential competitors and a lot of other useful information that can help you market your business, build a better product, and avoid business failure.

2. Have a business plan
Creating a business plan before you start is essential, even if you don’t need to get a loan or only use it as a guide. A business plan will ultimately show you what kind of results you can expect, as well as help guide your activities so you can prioritize the most important tasks.

Added to that, it will convince potential investors that you know what you’re doing. As a beginner, you don’t have to start with a complex business plan. You can make a sketch and add more details as you acquire more information.

Some important details to have in your business plan are:

  • Potential market
  • Ideal customers
  • Product information
  • Business objectives
  • Pricing model
  • Potential revenue
  • Strategy to reach buyers
3. Create a buyer persona
To build a successful business, you need to understand your potential buyers. This will give you the ability to gather more information about their needs, how to meet them, and how to convince them through marketing.

A buyer persona is a document that captures all the important details about your ideal customer(s).

Over time, you can refine your buyer personas or create new ones as your business begins to gain customers. Some important details to have in your buyer persona are:

  • Name
  • Gender
  • Age
  • Income
  • Location
  • Pain points your service can eliminate
  • Ambition
  • Hobbies
Having as many details as possible in your buyer persona will help you understand and send the right messages to your prospects. According to Single Grain, using personas can make your website 2 to 5 times more effective at targeting users.