Who the hell wants to kill their business?
No one in their right mind would want to do that, right?
Hopefully, you're here because you want to avoid these 5 mistakes...
Yes, I hope you really came here because of that.
So what are the ways you can kill your business (that you should avoid)?
The best way to kill your business is by being another choice for the consumer. I don't care how boring your product is, you better make it different. You need to stand out.
Look at Dollar Shave Club, it's just a cheap boring razor anyone can get, transformed into one of the coolest products ever through powerful positioning.
Domino's Pizza was the first to come up with their "30 minutes delivery or free" claim, that made them stand out from Pizza Hut who was the leading pizza place at the time.
Look for ways to stand out. You need to be creative but it is achievable... it is the only way to succeed and become THE choice for the consumer.
How many times have you heard it? Great products sell themselves!
It's a load of crap... the biggest lie ever.
The truth is, great products need great salesmanship to sell them.
In fact, it's because the sales people behind great products are so good you don't even realize they are selling you on it.
Yes, it's true... your product is important but there are plenty of average products out there that have become household brands through skillful marketing and sales.
I've seen a lot of businesses make stupid sales mistakes... that costs them millions.
Learn how to sell... you can start by learning some copywriting or partnering up with a successful copywriter.
You could always sell a crappy product... but the problem is...
You'll start getting a ton of refunds, complaints and if you manage to get enough people angry you can get a storm of bad press... bye bye good reputation.
I remember I wanted to sell a product and thought that a salesman could make up for my bad product. I was wrong and I wasn't the only one who's done this.
You probably love your product and you don't want to hear this... I know. But, it's time to accept the reality of things and just find something else... or at least improve your product if it's just a bit off.
You can't build a successful business with a horrible product.
Stay the same as you are now and you'll fall behind everyone in no time. You'll become outdated and no one will want you anymore.
Other companies will be years ahead of you and the amount of catching up you'll have will be tremendous. Did I mention that customers won't buy from you?
Make sure you're always improving your products. No need for massive changes, but regular tiny updates are what's needed.
You have an awesome product, a healthy amount of sales coming in... the only problem is... the amount of profit you make is small.
For those who don't know what a profit margin is, it's the amount of profit you make per unit of product or cost.
Let's say you're selling energy drinks. The cost to manufacture, distribute and sell a can is 80 cents. You sell it for $1... the profit you made is 20 cents or in other words... your profit margin was 20%.
Ideally, you should aim for a 25% profit margin - personally, I prefer to have a 50% - 70% profit margin (at least double the cost).
There are a lot of companies who run with under 25%... some as low as 2%. Low profit margins make it hard to survive economic waves and unforeseen costs... because of the low profit you make... it's like walking a thin line between life and death.
Yes, it requires hard work...
No, you shouldn't give up...
Yes, you can do it...
No, others are not better than you...
But, in the end... it's totally up to you.
You can either build a startup to success or raise the white flag to surrender.
Which one is it going to be?
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No one in their right mind would want to do that, right?
Hopefully, you're here because you want to avoid these 5 mistakes...
Yes, I hope you really came here because of that.
So what are the ways you can kill your business (that you should avoid)?
1. Do the Same as Everyone Else
The best way to kill your business is by being another choice for the consumer. I don't care how boring your product is, you better make it different. You need to stand out.
Look at Dollar Shave Club, it's just a cheap boring razor anyone can get, transformed into one of the coolest products ever through powerful positioning.
Domino's Pizza was the first to come up with their "30 minutes delivery or free" claim, that made them stand out from Pizza Hut who was the leading pizza place at the time.
Look for ways to stand out. You need to be creative but it is achievable... it is the only way to succeed and become THE choice for the consumer.
2. Assume Your Product Will Sell Itself
How many times have you heard it? Great products sell themselves!
It's a load of crap... the biggest lie ever.
The truth is, great products need great salesmanship to sell them.
In fact, it's because the sales people behind great products are so good you don't even realize they are selling you on it.
Yes, it's true... your product is important but there are plenty of average products out there that have become household brands through skillful marketing and sales.
I've seen a lot of businesses make stupid sales mistakes... that costs them millions.
Learn how to sell... you can start by learning some copywriting or partnering up with a successful copywriter.
3. Build a Crappy Product
You could always sell a crappy product... but the problem is...
You'll start getting a ton of refunds, complaints and if you manage to get enough people angry you can get a storm of bad press... bye bye good reputation.
I remember I wanted to sell a product and thought that a salesman could make up for my bad product. I was wrong and I wasn't the only one who's done this.
You probably love your product and you don't want to hear this... I know. But, it's time to accept the reality of things and just find something else... or at least improve your product if it's just a bit off.
You can't build a successful business with a horrible product.
4. Don't Innovate
Stay the same as you are now and you'll fall behind everyone in no time. You'll become outdated and no one will want you anymore.
Other companies will be years ahead of you and the amount of catching up you'll have will be tremendous. Did I mention that customers won't buy from you?
Make sure you're always improving your products. No need for massive changes, but regular tiny updates are what's needed.
5. Have Small Margins
You have an awesome product, a healthy amount of sales coming in... the only problem is... the amount of profit you make is small.
For those who don't know what a profit margin is, it's the amount of profit you make per unit of product or cost.
Let's say you're selling energy drinks. The cost to manufacture, distribute and sell a can is 80 cents. You sell it for $1... the profit you made is 20 cents or in other words... your profit margin was 20%.
Ideally, you should aim for a 25% profit margin - personally, I prefer to have a 50% - 70% profit margin (at least double the cost).
There are a lot of companies who run with under 25%... some as low as 2%. Low profit margins make it hard to survive economic waves and unforeseen costs... because of the low profit you make... it's like walking a thin line between life and death.
Yes, it requires hard work...
No, you shouldn't give up...
Yes, you can do it...
No, others are not better than you...
But, in the end... it's totally up to you.
You can either build a startup to success or raise the white flag to surrender.
Which one is it going to be?
Zak Mustapha is a marketer and the founder of Foolishness File on a lifelong mission to help entrepreneurs learn from other entrepreneur's mistakes so they can progress faster than others. Download his free eBook 3 Common Marketing Mistakes You Can Stop Making Today to Humanize Your Brand.
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