Are you starting a business? You must be very excited to set off your entrepreneurship journey. If you are about to run your business, you must have an idea or skills of running it. Competition is fierce, and riding it out is not that easy, especially if you do not have experience in running the business.
The business journey is not very simple. Most of the people start their businesses, but they end up shutting them down within the first five years of their journey. Just having a good idea is not enough to be sure about the success of your business.
There are a lot of factors that you need to consider before starting a business. You cannot be sure about the success of your business based on the validity of your business idea. There are a lot of factors that play a very important role in deciding the success of your business.
If you are looking to start your business, you should know the following scary stats. This will likely help you take into account the current scenario moiré seriously, so you accordingly make a plan.
Statistics that you must know if you are starting a business
Here is the scary but important statistics that you must know before you put your energy into running your business:
Employees’ retention struggle
If you are running a business, you may need to hire employees to get some of your work done. Of course, you will not likely need a team of professional people, but as your business grows, you will need the one to back you.
It seems that after hiring people, it will be much easier for you to run your business because your workload will be divided among others, but the fact is that it becomes more challenging. This is because of the low retention ratio.
Surveys have revealed that the most common reason for employees to resign from their job is the lack of appreciation. They try to put a lot of effort to help the company achieve its goal, but they do not get recognition.
Eight out of 10 employees leave their jobs because they are not appreciated. They find themselves as a liability, not an asset to the company. It is crucial to note that hiring is not cheap.
It requires a lot of money. If employees keep leaving your organization, your money will keep going out on recruitment. This is why you should try to learn to recognize the work of employees. This way you will be able to save your money on recruitment unnecessarily.
Another thing you need to focus on is cutthroat competition. Just because you have a great idea does not mean that you can easily survive the market. Competition is fierce, and it continues to be more competitive. Every year thousands of entrepreneurs step into the market with the hope that they will become successful entrepreneurs.
This is a little scary. When competition is fierce, it becomes quite challenging to keep the ball rolling. This is why you should try to make your business stand out. You should determine what you can offer your audience in a better and different way than your competitors.
You will have to be one of a kind if you want to attract the attention of users. You will have to frame a strategy that helps you perform better than your competitors. You may need to hire a marketer who can help make a strategy that works for your business.
Most of the entrepreneurs invest 50% of their capital from their savings when they start a new business. Even if you are running a small business, you will need a considerable amount of money.
Investing half of your personal savings can seem very daunting, especially if your business fails to run after some time. The situation is more horrible when you fund your business needs with external monetary sources.
For instance, if you need a car for your business operations, you take out a car loan by showing your business plan for the next two years but fail to make it to the top. This kind of scenario will ruin your finances very severely because you will have to ding your savings.
A rule of thumb says that you should carefully plan your finances. You must have enough money to meet all of your business operations, so you do not have to borrow money.
Try to find out ways to save money. For instance, it is worthless to rent out an office space when your employees do not need a dedicated workplace, and it has been proved recently that employees can manage to work from home.
Another scary fact is that paid advertising is not very effective method for generating leads. If you are looking to invest money on paid marketing campaigns, you should figure out the return on your investment, and you will find that it is not that impressive. Studies have discovered that content marketing can generate three times more leads than paid advertising.
Even if you are using social media ads, you will unlikely get the desired leads. So Content marketing is a great tool to attract your target audience, but it does not mean that you should never invest in paid marketing.
You should use both content marketing and paid marketing in a balanced way. Both types of marketing are essential to reach out to as many people as possible.
The bottom line
Starting a business can be daunting, and there are various statistical facts that you must take a look at before you set off. By knowing these facts, you can get to know what other things you need to focus on apart from the business idea.
This is not just your idea that can make your business successful. You will have to think about the strategy keeping these statistics in mind, so you do not struggle to run your business as others do.