Most small businesses end up failing.
It’s a hard truth, but failure is a big part of the entire entrepreneurial experience.
With that said, though, there are things you can do actively to maximize the chances that your business will succeed.
These important steps start early on, when you’re doing preliminary work like deciding on a sound business idea.
None of this is particularly new.
From markets and bazaars in ancient city-states, to today’s ecommerce landscape, businesses have always involved key elements like supply and demand, meeting existing market needs, and a unique selling point that no one else is offering.
These five basic best practices are essential if you’re considering building an online business.
If you’re going to offer a product or a service, you won’t get far if there isn’t a market for it.
(There are a tiny handful of exceptions here, the kind of products for which you manufacture demand, but they’re rare.) And that market should be something that’s sustainable in the long term.
Fidget spinners probably won’t be profitable for very long, but people will always need health insurance.
Stability beats trendiness every time.
In a recent article, Entrepreneur explains the five essential things you need to do before you start your business.
1. Identify a product or service that has a large market and that’s unlikely to decline.
When you create an online business in a niche that will never see a decline, you are drastically increasing the chances of building something that will generate revenue for a long time. I see too many people trying to start online businesses with only the short-game in mind. Instead, focus on building something with long-term sustainability.
2. You don’t have to reinvent the wheel — but you do need a unique component.
When you create an online business, you don’t have to reinvent the wheel, but you do need a unique selling proposition and a way to provide some level of value that isn’t currently available.
3. Identify how you can generate money.
There are several ways to generate money with an online business. You can sell your own products or services, re-sell products or services, sell information or courses, promote affiliate offers or sell advertisement space, for example.
4. Lay out a marketing and advertising plan that will help reach your monetization goals.
Your online business is unlikely to take off without a solid marketing and advertising plan in place. Whether you are using simple public relations strategies such as HARO for securing press mentions or launching a six-figure campaign on Facebook, you need a detailed plan.
5. Seek out feedback directly from your potential customers.
Launching an online business without any feedback from your target customer base is foolish. You might have a great idea, but a gut feeling or intuition alone doesn’t mean it’s a viable business model. Taking the time to gather feedback and constructive criticism can help you avoid launching a dud and coming to market with a better product.
For more great advice about how to start a profitable online business, check out the full article at Entrepreneur.