There are a couple of questions we get asked a lot. “How to make your business successful?” and “How do we get from being a start-up to being a successful and established business?”
We have studied hundreds of different businesses and have identified a few common characteristics most of them share.
Business Success Formula
We have simplified this system and created our business success formula.
PM + (PS * (EO – (C+E+P)) = Successful Business
Let me explain.
For a business to be successful there must be Profitable Market (PM) and a Product or Service (PS) that satisfies its needs and/or its wants.
It’s not enough to just have a great product or service anymore. Business success depends on your Product or Service firstly being noticed by the Profitable Market through effective marketing campaigns; then by selling enough of your Product or Service to have enough Cash or Fuel (F) to repeat the process.
This is called the Engine (E) of your business.
The more efficient the Engine is, the more profits you make. This is called Engine Optimisation (EO).
Engine Optimisation (EO) is mainly an internal process. However, your business subject to several external threats you have to overcome.
Competition (C) from other businesses is the main external threat. Your business can also be affected by Market (PM), Economic (E) and Political (P) factors that need to be monitored.
Characteristics Of A Successful Business
Now let’s look at the characteristics that most successful businesses share and what you need to implement them into your business.
Before you even start your business you must understand the market you are about to enter. For a business to survive in the long term the market must be profitable and sustainable.
Profitable: Your ideal customer must be able to afford your product or service.
Sustainable: It’s fine to be in a niche market, but it must be large enough for you to realistically achieve your business goals.
Quality, Relevant Product
First, you need to ensure there is product/market fit. Before you launch your business you need to know if your ideal customer is interested in your product or service.
Research them, find out exactly what they need and want. Find out their fears, desires and what makes them buy.
To take your business to the next level your customer has to transcend just needing your product or service to wanting it and, choosing it over your competition. A customer will pay a lot more money for a product or service they want over one they need.
For example, most people need a mobile phone. They don’t need an iPhone, there are many high-quality and more affordable options on the market. People buy an iPhone because it helps them to increase (or maintain) their social status.
To reach this level, you have to create a quality, reliable product or service and build a reputation for your business. There are no short-cuts and no guarantees to a successful business.
Business (Engine) Optimisation
Engine optimisation is the key to growing a successful business. Your business must be focused, efficient and responsive to both customer and market demands.
Key components of engine optimisation
Business strategy & Planning
A well thought out business strategy will help you map out what you need to do to achieve your goals. You don’t need a long business plan, just a one-page document that is well executed.
Business Strategy Basics
Your vision is the framework for all of your strategic planning. It needs to be both attainable and ambitious. Your vision must embody the passion you have for your business.
To achieve your vision you need to set a set of core objectives to help you to reach it. Objectives should be specific and should provide you with a clear set of actions to accomplish your vision.
Goals are specific actions you need to achieve each to reach each of your objectives. The key to making great business goals is to go beyond just what you need to do but to explain how you will do it.
A sound financial plan is the cornerstone of a business plan. It should last for the time-span of your vision and be aligned with your objectives and goals.
These assumptions should be reviewed against actual performance regularly to ensure you are still on track and re-forecast.
Successful businesses understand the need to continuously improve their business processes to become more efficient. This enables them to respond to market changes and provide better products and services to their customers.
Having solid, adaptable systems is crucial for success. Effective technology doesn’t have to be expensive. Use technology to simplify business problems and to spend more time on revenue-generating activities.
Poor marketing, along with bad financial management is the main area that causes startups to fail. Successful businesses build a marketing machine that generates limitless qualified leads and buyers.
Understanding your target market is the key to creating a successful marketing campaign. The more you understand your target market the more likely you will choose the correct marketing channel to reach them and create campaigns and messages that will get them to buy from you.
The specific selling approach a company uses is usually defined by its marketing plan. You should have a consistent, measurable and repeatable sales process.
How To Make Your Business A Success
Statistics don’t lie. 80% of start-ups fail.
Do not let this put you off starting your own business. Most of them businesses were doomed to fail because they weren’t set up in the right way.
The keys to a successful business is our Business Success Formula. If you start your business using the Business Success Formula as a blueprint you will decrease your chance of failure significantly.
If you are already running a business then you need to act quickly and re-structure your business and incorporate the Business Success Formula.