START -UPs-PROBLEMS AND SOLUTION PART 1
Today I would like to share some ideas about the need for start-ups, reason for the failure of startups and of course we will definitely give you some tips to achieve success.However the last one is a bit interesting, isn’t it?What is a start-up?A startup is a budding company that is just starting to develop. Start-ups are generally small and primarily it is financed by a group of founders or by a single person. These types of companies normally offer a product or service that is not offered very commonly in the market, or that the founders think that is being offered in an inferior manner.A sustainable growth is extremely crucial for a startup. ie, The maximum growth rate that can be achieved and maintained without the help of external financings like money borrowing or fund raising. By evaluating the growth rate, we can understand the future of the start-up. Nowadays failure rate of start-ups is high; hence, founders should consider not just the idea but also the experience of the team. Now we are going to discuss the reasons for start-up failure. If, we know the disease we can cure it with appropriate medicines. Similarly, if we know the reasons for failure we can definitely overcome it by taking necessary precautions.
One of the biggest challenges is competition. New businesses are like a newborn baby.Your competitors have the upper hand and advantages in the market.Because they have been in the field for a long time.Hence, they gained more knowledge in the business process and about the market.Take deep research about the competitors and their product, their business process etc., which help you to form a picture about the competitors and about the need of new improvements and quality of your emerging product/service.
2.PROBLEMS RELATED TO MARKET: -
Majority of the start-ups face the market problem.Nowadays we can see that new companies initially find the solution then they search about the problem that is suitable for the solution ie, they do not think about the market needs.The main failure of a product is that it does not solve any market need.Make a deep and wide market research, which helps us to get a clear-cut idea about the proper market of any product.
3.FAILURE OF BUSINESS MODEL: -
The business model is an important factor in the failure of the business.Optimism is good in life, but in the case of the business world, we have to open our eye in all directions.We must look forward the future problems.In addition, we have to think about the solutions that we need to apply.Be an optimist at the same time be alert.Each founder is misjudged about the product.They all think that their creative website and the product will definitely catch the market. Actually, in most of the cases, this happens only for very few customers after that the customer acquisition is an expensive task.First, we have to search the market and then we need to prepare a perfect business plan.Make sure that the plan is well organized and analyzed after the research.
Benefits of Customer Acquisition:
By applying proper customer acquisition methods helps the organization to gain the required growth.Effective and planned strategies will definitely help the organization to acquire the right customers in a cost-effective way.New companies like those that startups need to concentrate on customer acquisition well-established companies could shift their concentration to customer retention.Generally, customer acquisition cost is higher than the customer retention cost hence make a deep analysis about the benefits come together.
4. INEFFICIENT MANAGEMENT TEAM: -
The next major problem with the startup is related to the management team.A good management team is capable to avoid some problems.A weak team cannot plan a good strategy. If the foundation is weak, how can we build a perfect and strong building? Hence, from the weak strategy, we have developed a product that has no market value. Alternatively, they fail to validate the idea before the development stage. Problems during execution will result in a delay in product development which results in lower the product‘s market.Execution is important, smart execution plays a major role because others would have thought of the same idea earlier, but you have to be the one who is launching the product after proper execution & in the appropriate time. Well-planned and executed product will meet the urgent market need.
5. LACK OF BUDGET: -
Majority of the people think that starting a business is high risk because of the cost of realization and lack of budget available. In general case we start a business for making money, however, you cannot make money unless you have the budget to fund the new business from the initial stage.As early said risk is an important factor hence, you have to make sure about the cash flow is healthy.Even we have a perfect plan sometimes things never go as our plan for example product development may lag due to unexpected problems or we have to raise extra fund. Every startup needs a significant amount of money to cover the different expense. For eg. office space, new website, company logo, marketing materials, staffing, product launching program and the list is going on
Expense management is also important as the fund or investment management.As early said every startup need the significant amount of money to cover the different expense. For e.g., office space, new website, company logo, marketing materials, staffing, product launching program etc. Make sure that you never spend too much amount for decorating your office space or show the luxury of your office space.Remember that there is a lot of difference between an established company and a startup company. Hence, we have to avoid extra unnecessary expenses.
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