Creating a definition for “success” that applies to everyone can be hard. However, every company needs to have its way to know how well they are doing or what needs to be changed. They need be able to evaluate themselves and make improvements. But how do you evaluate the success of a small business?
1) Start From the Inside
Most all businesses grow out of some initial passion or strong interest on the part of an entrepreneur, so certain specific goals are already in the core of the business. The vision of the owner will lead the company to develop one particular product or service, and to target this product or service to a particular, ideal set of customers. Based on this, one way to measure your company’s success is to compare the actual development of your business with your original vision. How close it is to that vision?
Quantitative success (in the form of greater financial profits, or bigger customer bases) carries a great importance in the life of any business. However, setting limits on quantitative goals can sometimes provide small business owners with enough time to review and reaffirm some of the qualitative goals that may have prompted them to start their business in the first place. What was the dream behind your company? Was it to gain nationwide popularity, or be featured among the most profitable businesses in the world? Was it based on a wish to help people who needed a specific service? Running a small but efficient company will often make it easier for you to stay true to the original impulse for having started your business.
Having a personal definition of success can be used as the centerpiece of a whole system. Everything that comes afterward can evolve around it.
2.) Numbers Don’t Lie
Pursuing a dream comes with requirements; one of them is sustainability. Many entrepreneurs place an emphasis on helping others, and are less concerned with financial matters. However, if business owners have a hard time covering their basic operating costs, then the chance of being able to pursue their primary goals diminishes. Whatever the definition of business success is for you, the question of financially supporting your business’s infrastructure is inevitable.
Beyond this basic sustainability it’s important to consider the kinds of investments that are associated with different industries. For example, the amount of cash needed for a smartphone manufacturer to purchase tools and materials to build one phone is greater than the amount of money needed for a maker of hand-crafted greeting cards to buy tools and materials to create one card. Computer components are simple more expensive than calligraphy pens.
If you can integrate your goals with a detailed financial plan your chances of success will be greater. Stay true to your dreams, but follow the numbers. They will help to lead the way.
3) Customer Communications Are Key
To get a broader picture of your product or service, you need to ask the people. Customer service is one of the most important parts in creating customer loyalty and customer loyalty is the key to a successful company. Getting feedback can be as simple as adding a questionnaire at the end of an online purchase. Or, if you’ve opened up a stronger line of communication with a particular customer then getting feedback can be as easy as making a phone call.
Some companies take feedback so seriously that they launch promotional campaigns to get answers. They offer discounts, samples and other types of incentives to motivate people to write reviews. For your company, maybe the key is just asking what you are doing right or wrong, was your employee’s behavior towards the customer supportive, why they would or would not select your product or service over that of a similar provider. If the answers to these questions are positive then it can be said that you, as a small business owner, are succeeding. If, on the contrary, many of the customers are dissatisfied then the next step would be to determine the specific causes for this, and to come up with clear ways to address the issues.
We’ve looked at the three main positions from which to define business success. The first is a commitment to your original wish. The second is an ongoing review of your financial dynamics. The third is an ability to listen carefully to the needs of the people that you’re selling to.
Your own business’s success will be defined using a unique combination of each of these three aspects.
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