Every year, more than 5 million new American business owners do their best to take their companies from the ground floor to the stratosphere: unfortunately, most new businesses fold after the first year. The percentage of businesses that can survive more than five years remains relatively low. What is the secret to forming a successful small business? Are there any tips and tricks that successful entrepreneurs know that they’re not telling the rest of us? An important aspect of getting a business up and running is knowing your local audience, but internet marketing and advertising is also vital in this era of ecommerce.
Some entrepreneurial magazines recommend that new business owners think about their investment costs versus their reach, which means that you want to be sure that you can recoup your investment costs within a reasonable timeframe. If you are opening a coin laundry, for example, you may have to purchase expensive equipment and rent a building to house it. Do you have the customer base available that is willing and able to patronize your new business? Industrial laundry may have surpassed the $7 billion mark, but coin laundries can be hit or miss, depending upon the neighborhood.
The average coin laundry generates more than $15,000 every year — some laundry owners report that they gross more than $200,000 — but if you are opening it in an area where private homeowners largely have their own washers and dryers, you could be dooming your new venture before it even begins. It would be much more lucrative, in that instance, to situate your coin laundry in an area of town where people want the service that you are providing. In general, not doing market research can be extremely costly.
There are so many kinds of small businesses that it can be difficult to figure out which direction to take your investment capital. One potentially lucrative sector of private industry is rotomolding, or rotational molding: a hollow plastic locker, plastic pallets, recycling carts, and rolling laundry carts are all examples of products that are made via rotational molding processes. What distinguishes rotomolded products is that you are able to make smaller lots: you’re not committing to thousands of products that might take a very long time to find a buyer. Also, rotomolded products do not have any wasted material. The plastic molding process also produces items that are of a piece: there are no seams.
Rotational molding works well for products that are hollow and relatively large: a rotomolded plastic locker for fishing or hunting can include custom graphics, and then shipped to customers via the internet. You may want to invest in rotomolded products like a custom plastic locker or larger first aid kid for use in cars and on trucks. So much of investment and starting businesses depends upon knowing your audience and then making products that you know they will want to use. Hotel chains will need rolling laundry carts, but they could also use a plastic locker to keep certain chemicals safe. Find a good quality product that you know you can sell, or a service that you know you can provide, and start looking for your customer base.
Not everyone believes in luck, but there are times when even the most well thought out businesses fail. Management is experienced, employees are enthusiastic and able, but the market will not bear even an inspired idea. What makes some businesses fail and others succeed? Small business owners around the world are looking for a consistent formula that they can use to assure themselves and their investors a successful outcome, but the solution has proved elusive to date. Keep investigating new production methods and be willing to reach out to customers online. Do your market research and trust your instincts: you stand a good chance of making it to the five year mark and beyond.