By Helen Callier
Small Business Administration data shows that three out of ten new companies with employees fail within the first one to two years, and about 60% of new small businesses close within five years. The success rate for sole proprietors is worse.
Obviously, small businesses do not set out nor expect to fail, but without following proven steps to success, most are on a path to doom.
There are many reasons cited for small businesses failing. From my business experience and from associating with successful small business owners, there are five keys to success that are considered must do’s by small businesses. They include: 1) Be clear on your vision, 2) Know your big “WHY”, 3) Write your goals down, 4) Develop a strategic game plan, and 5) Get a Mentor
Be Clear on Your Vision – Successful small business owners are great at stating their vision statement. Do you know what you want your business to look like in 1, 3 or 5 years? If not then the foundation of your small business is on moving sand. Typically, in three sentences or less, a vision statement answers several questions such as: What are you building? What market(s) will your small business serve? Who are your ideal customers? What are your core products or services? What will your small business revenues be?
Know Your Big “WHY” – What is the reason you decided to start your small business? Is that reason big enough to keep you going when the market gets tough? Is it a big enough reason to keep you committed through 1 year? Through the 3rd and 5th years and for the long haul? And while money is important to all small businesses, it is often not a strong enough reason to persevere against the odds. Successful small businesses know their big “WHY”.
Write Your Goals Down – A business goal that is not in writing is not a goal at all, it is a wish. And wishes do not pay the bills or help make payroll. Instead unwritten goals create confusion and cause your small business to flounder, waste a lot of money and time. Small businesses that are successful work from clear, specific, time-based, measurable written goals that are reviewed on a regular basis. And business goals that are in writing increases the likelihood of achieving them.
Develop a Strategic Game Plan – If you are pursuing funding for your small business then writing a long business plan that highlights extensive details such as market opportunities, financial reports, competition and other analyses that shows your small business capability to make a profit and pay back the loan. A strategic game plan is shorter and usually is one to two pages. The first page of your game plan reflects your company’s vision and mission statements, measurable objectives, and a description of growth strategy. It also shows the action plan i.e. work to be done with completion dates. The second page of your strategic game plan shows your financial budget and sales projections.
Get a Mentor – Having a Mentor allows your small business to learn from others that have already succeeded and most importantly, a Mentor can assist your small business in avoiding mistakes, and wasting money. You can learn about the Small Business Administration’s Mentoring Program at www.sba.gov . Also, many State agencies’ small business programs have a Mentor Protégé Program along with local agencies such as METRO Transit Authority and Houston Independent School District. If Bill Gates, Microsoft, had a Mentor then it behooves small businesses to have one as a strategy for growth.
Helen Callier, President of Bradlink LLC, a Technical Services Firm, bestselling author of “Your Money is in the Follow-up”, radio show host and speaker. Tel: 281.312.9981, www.yourmoneyisinthefollowup.com
