Starting your own Business – Failures to Avoid to ensure your Future Business Success, and Research

Every year ... of people start a ... With more people stuck in dead end jobs and working for ... pay, it always seems like the next logical step. They strike out with dreams of becoming the next big thing

Every year thousands of people start a business. With more

people stuck in dead end jobs and working for sub-standard

pay, it always seems like the next logical step. They strike

out with dreams of becoming financially independent, being

paid what they’re worth, or being able to work their own

hours. The sad news, according to numerous government and

independent resources, the odds are stacked against these

budding entrepreneurs. In reality, the odds are stacked in

favor of failure as most new business start-ups fail in

three years, and many more fail before their second year.

What are the problems new entrepreneurs face that cause such

catastrophic results?

Biggest Reason for Business Failures – Failure to Plan.

The biggest problem seems to be lack of planning. New

business owners fail to complete business or marketing

plans. They get so fed up with present jobs, or life styles,

they jump into self-employment ventures. They fail

investigating local competition or the potential customer

market and start business ventures destined for failure.

They open shops and go out of business before their second

year. Had they taken some time in research, they may have

found the local market was too saturated or local business

was already struggling to stay operational. They may have

found certain barriers to entering their market that would

prevent them finding business success. However, they failed

to do that research, and many didn’t formulate business or

marketing plans. They lacked a road map taking them to their

goals, and combined with the other reasons mentioned, is why

they failed. Without clear plans identifying individual

steps to success, how can you become successful? Sadly, most

all business failures failed to create road maps.

A business plan is critical if you want government funding

or a bank loan, but it’s just as critical if you don’t need

them. The business plan is a report on research into your

chosen business field. By completing it, you find out about

your local market, competition and potential customers, if

your industry is growing or declining, and a host of other

information needed to formulate plans for business success.

While the business plan tells if it is a wise to open your

business, a marketing plan reminds you how to make sales.

The marketing plan lists step-by-step instructions to

increase business sales. One step may build on another,

while some steps are implemented together, but regardless

how these steps work together, it is important to think

about it BEFORE opening your business doors. Without a

clear, step-by-step plan to show where you are, where you

want to be, and how you get there, then chances of realizing

your dreams will be slim to nil. How can you sell products

or services if you don’t know what kind of people buy them?

That is just another thing business and marketing plans help

you discover. Without the information, these plans help you

find, you will likely fail in your new business. You can

find some valuable information for writing business and

marketing plans through the Kaufman Foundation’s

Entreworld.org at http://www.entreworld.org/Channel/SYB.cfm.

If you haven’t written these plans, then I’d suggest taking

time to start them now. They will help ensure business

success.

Lure of FREE Internet – I should get Information & Tools for FREE?

With more people flocking to the internet to start a new

business, many try accomplishing their self-employment

dreams with little financial resources. The internet has

become a place where people rely on finding information

freely and for no financial investment. In the beginning, it

may have started out that way, and free information was

abundant, but as more businesses flocked to the net, finding

free information is becoming increasingly difficult. Most

people depend on search engines to find information, but the

businesses learned to exploit search engine vulnerabilities

to gain visitors and most times you will only find paid

solutions for your information needs. Somewhere, the

information IS available freely, but it is going to take

time to find it, and sometimes it takes a LARGE amount of

time to find it. The question becomes how quickly you want

to start your business, and how much time you can spend

searching for information? If you want to start quickly,

then you need to realize the need to make some financial

investments in your information needs. Just be sure to

research the company before buying their information. It

ensures their information is timely and useful. If paid

information is not an option, be prepared to spend some time

researching the information. There are various government

resources for information searches. A good place to start is

FedStats located at http://www.fedstats.gov/ . They have a

toolkit including DataFerrett. DataFerrett is a government

database-search tool to find different market and

demographical information compiled from census information

and other government agencies.

Marketing – I Need to Know ALL About it Before I Begin.

Another problem stems from ineffective marketing efforts.

People spend time looking for marketing materials and ways

to self educate about it while failing to take action doing

something to try improving their exposure. If I can impart

one marketing secret to you, that secret is this: marketing

is somewhat a trial and error process. It involves making

modifications and doing testing to gauge what is most

effective for your market and products or services. Keep in

mind marketing works differently for different people too.

But in the end, marketing is building trust, integrity, and

reputation with potential customers and getting products or

services out into the consumer’s mind. Tracking efforts is

important. Without tracking, you will never know what works

and what doesn’t work. Be sure to keep marketing effort

lists. Include the marketing medium, company, an ad copy,

dates and times it ran, and add a tracking code to each one

to track the sales made from them. Lets say you run an ad in

your local newspaper to gain increased sales. When running

the ad, include promotional code or an extension at the end

of a phone number to know where the sales are coming from.

When someone calls or mails an order, make sure you collect

the information from the promotional code, or ask them the

phone extension they are calling. Add up the data and it

tells you exactly what ads are paying off and which ads

might need reworked. To determine what is working and what

isn’t, take the cost of the ad divided by the number of

sales and see which one is lower. Lower cost per sale is

more effective and better. Depending on your marketing

budget, place numerous different ads at once and test your

ads quicker to see what brings the best returns for your

marketing efforts. Don’t sit there and do nothing while

trying to learn everything you can about ad creation and

marketing techniques. Write up a few ads and start testing

them. The sooner you begin testing the sooner you learn what

will work for your market. Without sales, you have no

business. Without effective marketing, you have no sales,

and therefore will have no business. Don’t let indecision

sink your dreams.

From Brick & Mortar to Online Business Ventures – Doing it Successfully.

The next problem seems to be businesses making the jump to

the online arena. Once again, small mom and pop type shops

starting on the net with limited budgets take to free

hosting services to get a web site online while attempting

to increase market share. When done appropriately, this idea

can help boost sales, but done incorrectly, it only helps

eat away at profit margins and helps ensure failure. When

doing business on the internet, nothing beats having your

own custom domain. You won’t get that from most free hosting

services, and worse, many free hosting services place ads

throughout your pages to help recoup costs of free services

they provide you. In the business expenses grand scheme,

domain name registration is inexpensive. Many hosting

services are also inexpensive. For as little as $10.00 and

$20.00 per month, you can have a registered domain, and paid

hosting, which allows more flexibility than free hosting

services. When I speak of more flexibility, I talk about

ability to run automated scripts and possibly sell ad space

to other businesses. That’s a critical requirement for

membership sites and any business owner wanting automation

scripts to make business marketing easier.

Customer Composition & Continuing Education Process – Keeping Educated on Market & Consumer Trends.

Another area where most businesses fail is failure to

continue learning about potential customers. Even if you

develop good marketing materials, do all the planning, and

continue to increase visitor volume, failure to track their

demographics and trends can eventually lead to missed trends

changing visitor make up, and these trends could make

offerings outdated. If that happens, you will watch your

sales begin to drop off and any affiliate programs you

promote could start to suffer. Keep an eye on web site logs

and track visitor clicks, or even better; find ways of

gathering visitor data through polls and questionnaires on

your web site. Ask them direct questions and watch the

feedback. This information is invaluable when tailoring your

ads or deciding what affiliate program products and services

to promote. Find some free offers on the internet and offer

links to them to any visitors taking time filling out your

polls or questionnaires. Just ensure the freebies are

valuable to your visitors and you will increase chances of

gaining direct response information from them. Take for

example a scenario where you want to offer another product

or service, but that product or service will take some

extensive time to implement and produce. By placing polls

about the product or service features and asking visitors

direct questions about their need or lack of need for it, it

could help you avoid wasting time and resources on products

or services that aren’t going to sell. That’s just one

example of how powerful information is when it comes to your

business success. Use common sense, ask questions, and keep

your ears and mind open. Through direct response polls and

questionnaires, you will ensure future business success.

The Know it all Complex – Refusing to Accept Change.

Another time where businesses fail are when owners think

they know everything there is to know about it. Let me tell

you something, time is never ending and always changing.

Time marches on, and those choosing not to march with it get

left behind. That is what happens when you think you know it

all. Time marches on leaving your business behind, and it

fails. No matter if you’re in business for 25 years or are

just starting out, there is ALWAYS something to learn from

it. Whether it’s learning your visitors’ demographics

better, learning which ads draw more attention, or learning

new and creative ways to market your business, no matter how

much you THINK you know, there is ALWAYS more to learn. Not

only does time march on, but people change, and so does the

consumer market. Failure to track these changes through

online information gathering processes or paid services will

surely cause your business to falter and possibly fail.

Running a business is a constant learning process. Lean to

continue your adult education and you help ensure your

future business stability and success.

Biting off More than you can Handle – Knowing When to say When.

The last reason I will mention in this article is business

owners who try doing too much. You can’t be everything to

everybody. You have to pick an area that maximizes your

talents and downplays your weaknesses. Today, more commonly

referred to as niche marketing, is where you learn to

fine-tune your marketing target to increase business success

and sales. Running a business requires us to wear many hats.

There’s the accounting that needs to be done, marketing that

always needs improvement and submission to effective

advertising mediums, customer service, web site design and

promotion, writing content, and the list goes on forever.

One-man operations require an almost exhausting amount of

time and commitment to get work done that needs done. If you

don’t quickly learn your strengths and weaknesses, you soon

become so overwhelmed when adding more tasks that you could

suffer from shut down. Shutting down won’t accomplish

anything, and your business could very easily fail. Be

careful of this, as burnout is quite prevalent amongst

business owners. By knowing your strengths and carefully

evaluating projects before you implement them, you will know

when you can still do it yourself, or if you need to think

about hiring some help.

There’s a lot of money to be made in self-employment, but

only by taking steps to ensure your business’ future.

Educate yourself as much as possible while not being stuck

on knowing every detail before you act. It’s better to do

something than sit and do nothing while your business begins

to falter and fail. But by taking the proper precautions,

you could save yourself from falter and possible failures

before they happen. The best bet to running a successful

business is doing the research, write the plans, create a

credible list of information resources for future questions,

and track your visitor demographics identifying your

customers in as much detail as possible. Through planning

for possible problems, you have the answers to fix the

problems as they come up while avoiding potential business

failure. Remember, failing to plan means planning to fail.

Put in the time and research ensuring you know as much as

you can about your business and its operations. Know how

much it costs to generate a sale and know whom those sales

will come from. Find out how much it takes to run a business

in your market and the kind of profit you can enjoy. Knowing

all this information will help ensure you have proper mishap

prevention plans in place ensuring your business future

success. Until next article, happy business operations and

my wishes for your greater business success and growth in

2005.

Source: Free Guest Posting Articles from ArticlesFactory.com James Sanders