Running a start up business can be challenging – around a quarter of new enterprises do not survive the first year. Having undergone these challenges when setting up his own company nine years ago, Bill Duncan, partner of Fifth Dimension, has advice for those who find themselves in a similar position.
A good product or service is not enough to make a successful business – the company has to be run effectively to survive. However, new companies are often caught in a vicious circle. They need to keep control of costs whilst also adding value to the business and ensuring it continues to grow and develop.”
One of the most vital things for a new business to achieve is reliability, says Bill. “If you agree to provide a product or a service, make sure that you don’t let the client down. It could harm your reputation, because the business is relatively small, and if you fail to live up to your end of the bargain, potential clients will hear of it.”
Outsourcing is one way to achieve this reliability, says Bill. “There may well be a valid reason for being unable to fulfil your commitments to a customer, but ultimately you have to avoid this if possible. Using an outside contractor to provide the service can be a great way to prevent any disappointment.
Bill advises that you make sure you vet the contractor first, before asking them to step in. “The only thing as bad as failing to honour your obligation is providing a sub-standard service, so make sure the replacement is up to scratch beforehand. How much could it cost if your company’s reputation is tarnished?”
Planning ahead could help offset any extra costs incurred with contracting an outside provider. “It might be a good idea to have alternatives ready just in case. That way you may be able to negotiate a discount, or even provide a like-for-like service and provide cover for their commitments.”
Another thing to consider when growing the business is to engage in strategic partnerships with like-minded enterprises. By identifying similar companies with different yet complimentary business streams, companies can enjoy a number of additional benefits, points out Bill.
“By working together with others, you can dramatically improve your chances of making the business a success. Strategic partnerships can open up new possibilities because they can extend your network of contacts considerably, which is essential for small businesses, and they can present opportunities to tap into new markets and locations.”
Bill continues, “You can both benefit from the shared pool of knowledge too, and you can also split the costs of many things, which means you have more ‘buying power’ for your money. Small amounts can go a long way.”
Even joining local business networking groups can help achieve some of these results, says Bill. “They can be a great way to get the company name out there. Members of networking groups frequently help each other out, by referring potential new business, using each others services, or just providing a informal advice and support.”
“One of the best pieces of advice I can offer is that you can’t know it all – although it’s important that you learn new skills, you have to accept that there are other people who can either do the job better, or can suggest ways that you can work smarter.
Taking advice, or relying on the expertise of others, shouldn’t be seen as a failure on your part. It shows that you are open to new ideas and possibilities,” says Bill. “Take the time to develop yourself – that will undoubtedly help the business.”
