As many as 20% of businesses fail in the first year, while 30% fold in their second year, Forbes reports. Only 50% of businesses make it past year fives, which highlights just how important the first five years are for new ventures. After launching your business, growth is naturally your overarching goal – however, this is a continual, hard-won process that doesn’t happen overnight. While there’s no shortcut to success, a number of proven strategies can help you reach key milestones and catapult your business to success.
Form strategic partnerships with other businesses
Entering a strategic partnership with another business is a smart way to expand your brand reach and increase profits in the long term. Just look at the initiative between Pottery Barn and Sherwin-Williams as a clear example of a successful strategic partnership in the home improvement domain. On the Pottery Barn website, customers can match Sherwin-Williams paint colors with Pottery Barn furniture. The partnership advertises the paint manufacturer to customers while furniture shopping, therefore increasing reach and revenue.
A key benefit of strategic partnership is access to new customers – when you partner up with another business, you’ll reach their customer base in addition to your own. You’ll also boost brand awareness: launching a strategic partnership increases the numbers of customers exposed to your branding, which creates organic curiosity. Brand awareness is, of course, essential if you’re aiming to become a household name. So, if possible, try teaming up with a business already in possession of a larger customer base. After launching at least one fruitful strategic partnership with a successful brand, it won’t be long before other businesses start approaching you with similar offers.
Form an LLC
If you haven’t yet formed an LLC (limited liability company), doing so is a sensible next step for your business. An LLC is a type of business structure that provides you with personal liability protection, which essentially means you can’t legally be held personally responsible if your business suffers a loss. Therefore, your personal assets (including, your home, bank account, car, and investments) are considered separate to your business finances and protected from creditors trying to collect from your business. As such, with the protection of an LLC, you’ll be better able to take on risk and grow your business.
Forming your LLC is a fairly straightforward process, however, you will need to use a registered agent. A registered agent takes care of all official correspondence (including, tax documents and notices) on behalf of your business. So, take time to research various registered agents to ensure you select the right service for you. Northwest Registered Agent, for example, is the second largest registered agent in the U.S.; it’s been in business for over twenty years. So, is Northwest the best registered agent out there? It certainly offers a comprehensive range of core services (including LLC formation) at an affordable price. In fact, Northwest also offers address privacy, which is particularly valuable if you’re looking to keep your address off the public record.
Create a customer loyalty program
Customer loyalty plays a key role in business growth. By increasing customer retention, you can successfully increase sales. In fact, acquiring a new customer is as much as five times more expensive than keeping an existing one, while boosting customer retention by 5% can increase your revenue by 25%-95%. It’s also much easier to sell to your existing customers compared with new ones (a success rate of 60%-70% versus 5%-20%).
Customer loyalty programs, in particular, are an effective way to retain existing customers and increase sales. A good loyalty program provides customers with perks, while also forging an emotional bond between them and your brand. Above all, your loyalty program should offer customers benefits attractive enough to encourage them to join and keep coming back for more. Sephora’s loyalty program, Beauty Insider, for example, recently added Beauty Insider Cash as an enhancement. Customers can now exchange 500 points and receive $10 off their purchase, whereas, initially, they could only exchange their points for free sample products. Additionally, Sephora’s loyalty program is also packed with a host of other benefits, such as, free shipping, free birthday gifts, special events, meet-and-greets, and first access to new product launches – all effective ways to boost customer engagement and foster brand loyalty. In fact, customers who join and participate in high-performing rewards programs are, in turn, twice as likely to make purchases more often, according to the MIT Sloan Management Review. So, focus on building an attractive loyalty program and your sales will naturally soar over time.
With hardwork, strategy, and dedication, business growth is well within your reach. By creating strategic partnerships, forming an LLC, and launching a customer loyalty program, you can best set your business up for long-term success.
