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By Brian Hogan - Published July 17 , 2016 - STARTUP365
More and more startups are being launched every year, yet their chances of making it past the first year or five years is constantly declining.
Take a good look at that store around the corner. There is a 10-12% chance it will not be there next year. Whilst approximately 782,500 startups were opened this year, 658,214 are expected to close before the year’s end.
So how do you set up a company for long-term success?
“Starting a business is actually easy. You just have to make sure you follow the law.” says Dean Mullen, Chairman of the Startup Association. “But you’re not really in business until you sell something, and that isn’t easy.”
With many tools and resources available to newly created startups, it can be quite confusing to know which ones to follow in order to succeed. Dean shares some of his experience on how to get started and sift through the abundance of tools available.
“The Small Business Administration website is an excellent place to obtain information easily. It provides everything from details on how to run a business to information on writing a business plan to links to local centers offering assistance to startups.” Dean commented.
The big advantage of the Small Business Administration website, according to Dean, is that it also provides entrepreneurs with tools to help them examine whether they are suited to the startup arena to begin with.
“Across the years I’ve noticed personality to be a key determent of a person’s success as an entrepreneur” claims Dean. “It’s not to say someone can’t do it, but they’re much more likely to succeed if they possess some of the key characteristics of successful business people.”
Such characteristics include but are not limited to: adaptability, flexibility, vision, resilience and responsibility. The next step is often to have an in-depth scan of the industry one is going into. “Understanding the industry is key,” he said. “If someone is going to start a floral shop and they do a projected profit and loss statement and I don’t see spikes in February and May, they have no idea what they’re doing.”
Finally, “Businesses must develop a solid business plan backed by financial analysis. This is often the part most startups fail to do properly.” Like any analysis, it is as good as the information it is built upon. There are many good and free resources businesses can turn to, where they will be provided with statistics that will help them use accurate numbers in their financial forecast. A good first stop is the Census Bureau, which has detailed information in many areas including population, income and economic indicators for business.
There is no doubt that there are many factors that can contribute to a business success or failure. Nevertheless, by considering the guidelines outlined in this article in advance, many new businesses can ensure they are on a more solid path to success.