Is your startup stalled and not sure where to go? Do you own a small business suffering from financial fatigue, mediocre marketing, or poor profitability? The good news is that whatever term fits, there’s a cure for what ails a sub-par entrepreneurial venture. Owners need to remind themselves that nearly all new businesses encounter operational and other hurdles during the first few months of their existence. That’s what capitalism is all about.
Those who figure out how to overcome the challenges survive and have a chance to thrive with those who don’t usually fade away, switch gears, and try another industry. Of course, the goal is to be among the leaders who discover ways to stay afloat, compete effectively, and slowly build a customer base over the years. So, what should entrepreneurs do if they find their entities adrift? Consider the following suggestions, which can deliver positive results properly.
Rethink Marketing Strategies
One of the most frequent illnesses of a struggling business is weak or misdirected marketing. Unfortunately, too many first-time owners are reluctant to devote enough financial resources toward advertising campaigns and promotional efforts. Others pour money into the pipeline but aim it at the wrong group of potential customers. How can managers rethink their strategies and get measurable results?
First, rewrite the entire marketing plan, beginning with research about the target demographic. This sort of reworking entails an admission that the original ideas were off-course. Next, consider utilizing different sales channels. Be open to some tactics you perhaps neglected the first time, like promotional podcasts, ad word placement, radio spots, coupon book tie-ins, TV, billboards, and guest blogging.
Use Personal Loans for Maximum Impact
The lack of funds can stifle even the best-laid plans of owners and founders. Startups need capital, and in most cases, it makes good sense to apply for a personal loan to finance a successful launch. The very definition of startup implies that profits have not yet appeared. People resort to various techniques to obtain that initial infusion of money.
Dedicated owners take out second mortgages on their homes, sell unneeded assets, borrow from relatives, pull cash out of retirement accounts, and yank some money from savings accounts. Just because they resort to those approaches doesn’t mean they’re good ones. But personal loans represent a more commonsense way to leverage the power of a decent credit rating to acquire much-needed capital.
Get an Outside Opinion
Management consulting firms exist for a reason, and contrary to the myths, they don’t all charge excessive fees. Many reputable national consultants specialize in startup businesses. Shop around for reasonable rates and try to get a feel for the providers who would fit your situation well. Avoid shop consultants who use template-based questionnaires and avoid speaking with you over the telephone. In general, there are two levels of service. Tier one includes an analysis of your organization’s problem but does not suggest more than a few essential proposed solutions. Tier two, while more costly, includes several ideas about resolving the issues the provider identified.
Rewrite the Business Plan
Do a complete rewrite of the original business plan, striving to include more detail about financial parameters and realistic assessments of potential profits. If you aren’t a capable plan writer, consider investing in a consultant offering that service for a reasonable cost. Prices will vary significantly depending on how large and complex your operation is. But for owners who need a fresh, realistic, workable plan, the investment can be worth every dollar.
Outsource Most Tasks
If the company’s stalled operations or growth results from a lack of team members, explore outsourcing to reduce the workload. It’s human nature for founders to want to do it all. Unfortunately, they usually become overworked, frustrated, and headed toward unpleasant results. This scenario is typical for one-person or tiny businesses where a handful of individuals attempt to perform tasks outside their expertise.
Outsourcing can be a quick, low-cost way to send jobs like tax return preparation, IT security, payroll, and advertising to specialist firms or independent contractors. Always research the marketplace before signing a contract for outside help. Ask for referrals, speak with providers, and take time to evaluate competing offers from different firms.
Fortify Your Professional Network
Professional networks are the missing link in many organizational plans. The truth is that with all the talk about how valuable networking is, only a tiny percentage of entrepreneurs take the time or try to build worthwhile contact networks. On the positive side, the internet makes it much easier to assemble a list of names that can offer support, advice, and other help when needed.
Owners who already have small networks can fortify them in several ways. Consider joining a local Chamber of Commerce, signing up for membership in industry organizations, contacting non-competitor startup owners in your city, and hosting power breakfasts. Online resources for network building include platforms like LinkedIn, Twitter, and Facebook, but don’t ignore smaller websites that specialize in helping business professionals make essential connections.
Downsizing can take several forms, so experiment with the technique before deciding how to proceed. New businesses can usually get by with little or no office space, which is why so many first-time owners work out of their homes. If operational expenses are a significant burden, consider aiming for break-even profit levels for six months to take the pressure off the budget. Keep sales targets reasonable, and don’t hire new people until the company’s income can easily support the payroll. Downsizing is also an attitude, so strive to adjust your thinking to support a more minor, leaner operation. It can make sense to run the organization part-time for six months to keep costs as low as possible but still earn a profit.
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