Focus on building a strong business reputation before expanding: Three (3) ways to get it done!
It is often a tussle for small businesses to get a foothold in a crowded market. This explains how a staggering 65% of start-ups go under in less than a decade. Well established industry players go all out to protect their market advantage with ruthless attacks on territorial ‘encroachers’. It is tough out there for new and small businesses, isn’t it?
Business failure bites hard. At times failure in a commercial pursuit could dampen any level of courage mustered by an entrepreneur at the preplanning stages. In other cases, it brings about prolonged personal ruins when every saving has been poured into salvaging whatever remains of the failed business. Added to that misery, lenders foreclosure and investors rejection could make the entrepreneur keep fighting all through the remaining part of life to safe his or her reputation.
The Canada Business Network emphasized the challenges small business owners face. It wrote, “Growing businesses face a range of challenges. As a business grows, different problems and opportunities demand different solutions – what worked a year ago might now be not the best approach. All too often, avoidable mistakes turn what could have been a great business into an also-ran”.
“Recognising and overcoming the common pitfalls associated with growth is essential if your business is to continue to grow and thrive. Crucially, you need to ensure that the steps you take today don’t themselves create additional problems for the future. Effective leadership will help you make the most of the opportunities, creating sustainable growth for the future”, it added.
It is therefore not out of place for startup business owners to be so determined to fend off business failure with all the intellectual and mental arsenals at their disposal. That won’t come with mere wishful thinking. One of the strongest approaches to avoiding business failure is to start small, build a strong reputation, and start expanding bit-by-bit. Let’s take a quick look at the steps that form the approach:
- Start Small – The law of growth is a familiar concept. Everything that reaches its prime must start from scratch. This is because the capacity to weather tough natural and human reactions can only be built over time. To survive the socioeconomic realities (headwinds) that serve as forces that shape markets, a business needs the strength that comes from market knowledge, a network of key political and regulator relationship and deep talent base. Possessing this wealth of resources won’t happen overnight. Small business owners should start where they are and build the relationship and knowledge needed to expand.
- Build Strong A Strong Reputation – Reputation is the major driver of market share growth. How would you feel if someone passes a bottle of an unknown and untried food brand to you? Except someone told you he or she had tested the product and guaranteed its safety, you might not want to buy or use the product. If a business chooses to expand beyond its image equity and share of public, such business could meet strong mental restriction by consumers. To avoid this crippling response, it is advisable to build a strong reputation for the business brands and expand accordingly. These are three ways to build a strong reputation.
- Focus on Building a Speciality – Build Speciality in a product or a process. When a business joggles different layers of services or products, it is likely to communicate a confusing image that may impact negatively on consumer confidence.
- Build consistency – It takes time to master and deliver, consistently, an acceptable quality standard. However, by keeping up with the process, the business team would soon learn and master the demand for quality products and deliver it back-to-back.
- Communicate – Tell the whole market about your incremental achievements. The more the market learns about your achievements, the more they will take to you.
Expand Bit-by-Bit – If the business expands according to the level of the reputation it has built out over time, the market would respond with an encouraging rate of acceptability. Remember, it takes time to be comfortable with a stranger hanging out in the neighbourhood. When your business has built out a sufficient degree of familiarity and quality acceptance with the market, it can keep earning the consumer nickel and dimes.