How to Grow a Successful Business

Starting a business requires more than just a great idea

To build a successful business, you need more than a good—or even great—idea. You have to be well organized, flexible, and creative, and develop a knack for paying close attention to the details while never losing sight of the big picture. You should also be prepared to make some personal sacrifices. Whatever type of business you have in mind, these nine basic tips, with links to additional advice, can help you get it started and keep it growing.

KEY TAKEAWAYS

• Starting and growing a business requires good organizational skills, creativity, and constant focus, among other essentials.
• It's important to be aware of your competition, particularly the things it is doing that you might want to adopt or improve upon.
• You'll almost certainly end up working harder for yourself than you would for someone else, so be prepared to make some sacrifices in your personal life.

1. Get Organized

Being organized is a prerequisite for success as a business owner. This will enable you to finish projects quickly and keep track of all the things that need to get done. Making a daily to-do list is an easy method to get and stay organized. Cross each thing off your list as you finish it. Additionally, keep in mind that some activities are more crucial than others. First, try to focus on the most important ones.

There are a ton of helpful internet resources at your disposal. These consist of programs like Microsoft Teams, Zoom, Asana, and Slack. Having said that, a basic Excel spreadsheet can fulfill a lot of a small business's first organizing needs.

2. Keep Detailed Records

No matter how busy they are, successful businesses take the time to keep careful accounting records . By doing so, they know where their business stands financially and can often get a better (and earlier) grasp of any potential challenges they might be facing. Investopedia periodically rates the best accounting software for small businesses .

Many businesses today keep two sets of records: one physical and another in the cloud . That way, a business owner no longer has to worry about losing crucial data if something unfortunate happens, like a fire, computer virus, or other calamity.

3. Analyze Your Competition

To be successful, you can't afford to ignore your competitors. Instead, take the time to study and learn from them. Larger companies devote significant resources to obtaining this sort of competitive intelligence .

Depending on your type of business, there are differences in how you analyze the competition. If you own a restaurant or retail establishment, you might be able to simply ask patrons what they like and dislike about a competitor's establishment while dining there to gather intelligence.

If your industry, like manufacturing, gives you less access to your rivals' internal operations, you should try to stay informed through trade publications, talk to any customers you may have in common, and get and carefully review any financial information that your rivals make available to the public.

4. Understand the Risks and Rewards

Another key to being successful is taking calculated risks to help your business grow. Besides contemplating the potential rewards if you succeed, a good question to ask is: "What's the downside if this doesn't work out?" If you can answer that question, you'll know what the worst-case scenario is. If you could live with that scenario, and are prepared to take the necessary steps to manage the risk as much as possible, you might want to give it a go. Otherwise, this could be a good time to consider other opportunities.

It's important to weigh the benefits and dangers when deciding when to launch a new product or create a business. For instance, the COVID-19 pandemic's significant economic disruption brought new chances for some enterprises, like manufacturing and selling protective gear, while posing challenges for others, such operating a restaurant with indoor dining restrictions.

5. Be Creative

Never stop searching for methods to enhance your company and set it apart from the competitors. Acknowledge your ignorance and maintain an open mind to novel concepts and alternative methods.

Look for chances to grow your present company or create associated ventures that will bring in more money and offer the advantage of diversification. A notable illustration is found in the history of Amazon. The business began as an online bookshop and developed into a massive e-commerce corporation that sold almost anything. These days, it's also becoming more and more present in physical stores. Amazon Pharmacy, Amazon MGM Studios, Whole Foods Market, and Zappos are just a few of its numerous subsidiaries.

6. Stay Focused on Your Goals

The proverb "Rome wasn't built in a day" also holds true for starting a business. Establishing a business does not guarantee that you will make money right now. It takes time to introduce yourself and your offerings to others, so be patient and committed to reaching your objectives.

Even many small business owners who ultimately achieve success won't see a profit for a few years and will have to rely on borrowed money (if they can get it) or their own savings to support the business until it can become profitable. Fortunately, there are a variety of ways to finance a business .

That being said, if the business is not turning a profit after a reasonable period of time, it's worth looking into why that is and whether the business needs to go in another direction.

7. Provide Great Customer Service

Too many businesses forget the importance of providing great customer service . If you deliver better service for your customers, they'll be more inclined to come to you the next time they need something instead of going to your competition. High-quality service is one key to obtaining competitive advantage in the marketplace.

Some businesses refer to this as a taking a consumer-centric or client-centric approach .

In fact, in today's hyper-competitive business environment, service is often the major differentiating factor between successful and unsuccessful businesses. This is where the saying "undersell and overdeliver" comes in, and savvy business owners are wise to follow it.

8. Be Consistent

A crucial element of company success is consistency. To succeed, you must consistently take the required actions, day in and day out. By doing this, you'll establish enduringly beneficial behaviors that will bring you revenue over time and happy clients from the start. Consistency is also valued by customers.

9. Prepare to Make Some Sacrifices

It's common to need to put in more time running your own business than working for someone else. This may entail seeing less of your loved ones and friends than you would like to. For those who are dedicated to making their business succeed, the saying "there are no weekends and no vacations for business owners" holds true.

Not everyone is suited to be a business owner. You will save yourself a great deal of trouble and perhaps a great deal of money by choosing a different job path if, after an honest self-evaluation, you determine you're not cut out for it.

How Do You Increase Sales?

Increasing sales can come from a few different places. You can raise ad expenditures where advertising has already proven effective, proactively solicit referrals from existing clients, build a direct-to-consumer email list, and others. You can also expand your product portfolio, but if the new additions underperform, that will negatively affect your bottom line.

What Makes a Startup Successful?

Business success is a difficult concept to quantify, but if it means generating returns for stakeholders, startups can be an excellent way to deliver returns. The best startups have a good product or service that is scalable. A well-run startup will understand the overall market and its particular place in it, be able to pivot quickly, and be ready to take advantage of opportunities when they present themselves.

The Bottom Line

Growing a successful business is hard work, and not everyone succeeds at it. According to 2022 data from the U.S. Bureau of Labor Statistics, about 20% of new businesses fail during their first year, 50% fail during the first five years, and 65% fail during the first 10 years. Only 25% of new businesses make it to 15 years or beyond.4

If you want to be among that 25%, paying attention to these nine tips is a good start, but certainly not exhaustive. To own and run a successful business you'll want to be in a state of constant learning and adapting.

Compete Risk Free with $100,000 in Virtual Cash

Put your trading skills to the test with our FREE Stock Simulator. Compete with thousands of Investopedia traders and trade your way to the top! Submit trades in a virtual environment before you start risking your own money. Practice trading strategies so that when you're ready to enter the real market, you've had the practice you need. Try our Stock Simulator today >>