4 crucial tips for startups
The first year of a company is a sprint. It is a rush for next year for the chances of survival to increase and for the business to prosper. Here are four tips to help your startup succeed even in the worst economic environments.
(1) You can’t trust current clients and networks
For any new company, a constant flow of business is a must to survive. Word of mouth is no longer the way people do business.
Whether the business comes from search engine optimization or pay-per-click, startups must have a strong web presence. Of course this is in conjunction with a strong brand, however the former comes before the latter.
(2) Being the cost leader generally backfires
Many startups enter the market and immediately position themselves as the most profitable in the industry. Most of the time, this does not work.
When companies search for a service or product, they typically don’t know much about the industry or downstream companies they intend to do business with.
Therefore, these companies rely on price to guide them and allow them to make the best decision. It has its Wal-Mart and Targets, but it also has its stores on Madison Avenue that are still in business.
The latter is more difficult to execute. Defend quality.
(3) Stop concentrating on the business plan, move on
Many start-ups sit around and ponder too much about their business plan. The opportunity cost of this is extremely high. Also, this does not lead to any execution.
Start-ups typically end up selling a different product or offering a different service than the one they set out to offer to their clientele. Market conditions are constantly changing and this alteration leads most companies to change with these fluctuations. And that is not bad.
(4) You probably don’t know your competitors
When clients of my company come to us, they usually ask about hiring direct competitors. I always give them an awareness that they probably don’t know who these companies are or if they even exist.
When I started this business, I thought I knew my competitors, but every time a client comes to us because they have a problem with another firm, they give me the name of a staffing organization that I have never heard of.
Again, this is due to the extremely high percentage of commerce that takes place on the web and the uncertainty of the various keywords that people within these companies are searching on Google.
After closely studying my website analytics, there are almost no duplicate Google keywords that people search to get to my company site. Furthermore, only 28% make it to the home page. The rest is widely dispersed.
However, there is a silver lining to not knowing who your competition is as a startup. It comes in the form of not being able to copy them. When it comes to the entrepreneurship game, only the competitive survive. The rest fades away.
Startups exist to reinvent the wheel, not to copy it and lose themselves in the scheme of things. For start-up owners, this means stepping out of their comfort zone. Sometimes having people look at you instead of you looking at them is a good thing.