Small businesses are the backbone of the American economy. According to a recent study conducted by the U.S. Small Business Administration, there are over 30.2 million small businesses in the country. This translated to 99.9 percent of all businesses in the United States. In 2018, they employ almost 59 million people in the country.
However, the success of a small business relies on multiple factors. Unless you’re running a completely online business such as an internet store or similar service, your small business will need to fit into the community. Without determining if your business is a good fit with the neighborhood, you may shutter your business within the year.
Here are 6 ways you can ensure your small business will flourish in your community and remain profitable.
1. There’s a Need
According to business experts, lack of a significant market is one of the top reasons small businesses and startups fail to prosper. Study the neighborhood if there’s an actual need for your type of business in your community. If you’re trying to set up a franchise for sign printing, make sure there are plenty of other businesses who will want to become customers. This will ensure you have a constant source of revenue to depend upon.
2. There are Few Competitors
You may not be the first person to realize there’s a need for your business in the neighborhood. Identify potential competitors in the community. If there are more than three providers of the service or product you plan on selling, you should consider changing the business. If you’re really determined to hawk your wares in a community, see what your pre-existing competitors are doing wrong and how you can improve upon their services.
3. A Central Location
Just like in real estate, your business relies on a great location to become profitable. Although there are plenty of successful hole-in-the-wall operations, a small business needs excellent foot and car traffic to sustain itself. These pedestrians and motorists can be potential customers. Having a central location also makes you more accessible and easier to find, which is important if you’re relying on online users to visit your physical store for revenue.
4. Nearby Suppliers
Logistics is an important facet of running a small business. A lengthy travel time between your suppliers and your store can increase costs in your overhead, not to mention it can cause delays in production or sales. You need to determine if you have access to nearby suppliers for your company before you even open it. This will make it cheaper to make your products and lets you have a fully stocked inventory without worrying about your suppliers getting stuck in traffic or similar travel problems.
5. Convenient Surroundings
A central location alone isn’t enough to make a possible place for your store or business sufficient. You need to consider if the place around your possible location is convenient. First and foremost, is there a nearby parking space for your customers? If not, is there at least a few street parking spaces out front? Is it in any danger of flooding during a rainstorm or does the street have a reputation for repeatedly being under construction? All these factors can determine if customers will flock to your location or if it will drive them away instead.
6. Abundant Partnerships
Business partnerships are different from suppliers in the sense that these companies can help you form a support network. They can refer clients to you, or you can provide products to their customers that they’ll need. For example, if you run a restaurant or similar food-industry related business, you may want to form a partnership with local courier services, so they can deliver food to your customers for you. Such partnerships are essential in ensuring your business’s success.
When it comes to running a business, keeping an eye on the big picture is essential in determining success. Analyzing the community and how your small business will fit into it is important for the future prosperity of your enterprise.