The statistics are sobering. It's estimated that more than 600,000 new businesses are launched every year in the U.S.
Approximately 80% of those businesses will fail within the first twelve months. For every successful business startup, there are four more that will experience a catastrophic outcome before their first anniversary.
Knowing how to startup a successful business means understanding the essential building blocks of profitability in today's marketplace. These days, entrepreneurs are extremely shrewd and savvy business professionals who are prepared to pounce on every opportunity that presents itself. The best way to stay ahead of the curve is to integrate the essentials into your business model and pay close attention to our tips for starting a successful business venture in the current economic climate.
- Business plan. Successful small businesses always begin with a solid business plan. Business plan software, consultants, mentors and coaches can lay the groundwork for business plan creation. But ultimately, the business owner is responsible for the footwork and mental investment that is necessary to produce a solid and achievable business plan.
- Cost-management. Business startups often overspend on everything from office supplies to manufacturing equipment. Instead of spending based on where the business is now, they opt for high end features and products that are more appropriate for an established and profitable operation. During the startup phase, manage costs wherever you can – even if it means getting by on a shoestring for the first few years.
- Aggressive marketing. Right out of the gate, make a commitment to pursue aggressive marketing tactics. As a newcomer to the marketplace, you're up against entrenched competitors with an established presence. Design a marketing plan that exploits every opportunity to introduce your name, brand and products into your target market.
- Financial metrics. Financial metrics (including a breakeven point) remove emotion from the decision making process. If they have been constructed properly, financial metrics can be used as triggers to launch both investment and cost-cutting activities.
- Asset protection. Despite your best efforts, you startup business may not survive its first year, leaving a trail of unpaid debts and other liabilities in its wake. If the worst case scenario eventually becomes your new reality, you'll sleep easier knowing that you have consulted a professional and done your best to protect your personal assets, including your home and personal savings.