4 Ways to Boost Your Company's Odds of Long-Term Success Sticking to a few basic principles can position your business for a brighter tomorrow.
By Ian King Edited by Chelsea Brown
Opinions expressed by Entrepreneur contributors are their own.
Any entrepreneur who starts a new business will naturally want the new venture to stand the test of time. Unfortunately, not all companies do. Lack of funding or consumer interest, supply chain shortages, inflation and a host of other factors can cause a business to flounder or even fail if it's not built on a solid foundation.
I've spent decades working as a business consultant for companies in a range of industries. While each business is unique and needs a unique approach to its many challenges, there are some things every business owner needs to do to build a strong business foundation that will boost the company's odds of long-term success. These pointers may not immediately boost sales and increase profits, but they will help a business to keep running even as others shut their doors.
Related: The Essentials Behind Long-Term Success of Your Business
1. Flexibility
The world is continually changing. New technology can make products and business models obsolete with little or no advance warning. Economic change can wipe out demand for certain goods and/or services. A natural disaster can wipe out a customer base in any given area overnight.
Flexibility enables a business owner to make needed changes to the business so it can survive difficult times. In some instances, these changes may be temporary. During the Covid-19 pandemic, for instance, some restaurants started selling groceries in order to keep their doors open and generate sales. In other instances, change may be permanent. A company may need to pivot from offering luxury items at a high price to offering essential items at a reasonable price. Services may need to be discontinued, replaced or made to include more or fewer amenities.
Staying abreast of industry developments, current events and company data can help a business owner know when to make changes to keep the business running well. The sooner and faster one is able to adapt, the higher his or her odds of long-term success.
2. Wise financial management
Wise financial management is an important aspect of business flexibility. Every single business owner should know how much he or she is spending every month and assess these expenses to see if some can be trimmed. A work-from-home model, for instance, can save a business owner the expense of leasing office space, maintaining the office space and paying for utilities. Automating certain tasks can help lower payroll expenses by reducing the number of employees one needs to hire and/or reducing the hours employees need to work in order to accomplish certain tasks. Regularly assessing the cost of purchasing materials for product creation can help a business owner find new sources that may offer better deals and/or may have access to better materials.
Having a financial cushion can save a business from ruin when hard times hit. However, it may not be enough on its own. A business owner should be prepared to take drastic action should the need arise. This may include working shifts rather than hiring extra workers, closing the business during slow hours or eliminating products that do not bring in a good return on investment. Even so, a financial cushion is a must if a company needs to weather months or even years of slow growth in order to remain in business.
Related: Here's Why Financial Planning is Key To Success
3. Building brand loyalty
Consumers who are loyal to a particular brand will continue to make purchases even if new competitors offer similar products at a lower price. They will also recommend the brand to new customers, giving a business free advertising and bringing in additional sales.
To build brand loyalty, a business will need to take time to get to know its long-term customers and show appreciation for their business. Loyalty programs can help, as can personalized emails and targeted pop-ups that provide customized suggestions based on one's search engine history or purchase history. Offering a peek into the inner workings of a business can help customers feel connected to the company and its employees. Fast, efficient customer service is also a must, as consumers expect to be treated with respect and professionalism should they need help with an item or service.
4. Building employee loyalty
Employees are the backbone of any business and can be difficult, if not impossible, to replace. To ensure high office morale and a good employee retention rate, employers should pay close attention to issues that affect staff members and look for ways to make work better, easier and more enjoyable. This does not necessarily mean raising salaries; rather, it could be the provision of extra vacation days, the offer to work from home to avoid a long commute, training opportunities to enable an employee to reach her or her full potential or even a day off for a religious holiday or observance.
A business owner who is unsure how to keep employees happy may want to ask staff members what benefits or perks are most important to them. The answers are likely to be varied, and a business may not be able to accommodate all requests; however, a wise business owner will try to meet the most important employee needs while offering an open line of communication to ensure staff members are comfortable asking for help when they need it.
Related: 4 Relationship Tips to Increase Employee Commitment and Loyalty
Over the years, I've enjoyed working with a range of businesses in multiple industries. My projects currently include working as a senior advisor with a firm that owns restaurants, convenience stores and accounting firms. I've seen businesses succeed against all odds, and I've seen others that could have been successful but don't make it long-term. The pointers offered above are some of the most important bits of advice that I could give any business owner. It is impossible to know what the future will hold and prepare for every eventuality. Still, I can say for certain that flexibility, wise financial management, building brand loyalty and meeting employee needs will boost a company's odds of long-term success.
