Before you start-up or scale, these 3 questions can determine your success

Starting or scaling a business is exciting - you’re confident that you’ve found a winning product or service, and can’t wait to share it with the world and see it grow. 

But beyond that initial launch, the longevity of your business comes down to how viable it is: what is your potential for long-term survival and profit? 

Unless your business was purely created to capitalise on a timely trend, you’ll be keen to see it last beyond its first year. More than 40,000 businesses were created in NZ between April and December last year, yet Statistics NZ estimates that only 37% of startups still exist after 2 years. 

While there are hundreds of unpredictable elements at play that determine whether a business will succeed or not, viability is one that you can control. 

So what makes a business viable? 

A viable business is (or has the potential to be) profitable, meaning it has more revenue incoming than outgoing. 

If a business isn’t viable, it’s difficult to maintain operations without going into a deficit. Non-viable businesses must find ways to increase revenue and cut costs, but even then it may not be enough to see the business survive.  

So how can you ensure from the start that your business is viable?

Three Questions to Ensure your Business is Viable

Viability is about much more than just incomings and outgoings. To have a viable business, you need to know how you fit into the market, what’s the demand for your product/service, and where you stand against your competitors. 

The following three questions are not only essential for the overall success of your business, but also key for creating a strong and effective marketing strategy to take your business message to the world.

1. What is your Unique Selling Proposition?

What is it about your product or service that makes it so unique? 

Ask yourself: 

  • Why would someone buy this, instead of something else? 
  • What can this product or service do for them? 
  • What problem does it solve? 

A USP makes it easy for potential customers to understand what you do and why they should pay attention. You can think of it like an elevator pitch - if you had to distil down to a single sentence what you do and why it’s unique, what would you say? 

In order to understand how your product or service is different from what currently exists in the market, you will first have to do some research (if you haven’t already) to understand what others are offering and where there are gaps that you can fill. 

Need some help getting started? Shopify has a great resource about writing a strong USP, and several good examples. 

2. What is your Competitive Advantage?

Going hand in hand with developing your USP, a viable business must also understand its competitive advantage and how to use it. 

Ask yourself: 

  • Who are your direct competitors, and how can you outshine them? 
  • What about your business is an advantage you can capitalise on? E.g. your location, vision, unique business type, quality of service. 
  • Why would customers fall in love with your brand? 

Your competitive advantage is what will help you to stay ahead of your competitors in the market, and remain a viable business. It answers the question: why should people buy from you? 

Veer away from competing on price or specials, and instead look to something you can deliver sustainably over the long term: personalised customer service, unique proprietary systems, a great location, or an innovative product that can’t easily be replicated. 

From the market research you did earlier, you’ll be able to see not only what’s being offered in the market at the moment, but what’s missing. Where the gap exists is where you can step in to own that space and gain an advantage.

3. Who is your Stable Customer Base?

Core to each of the above points is knowing who your customers are (or will be). 

Ask yourself: 

  • Who is going to buy your product or service? 
  • What are their problems that I can solve? 
  • How do they find new products, and make decisions - how can I reach them? 

A business lives and dies by the strength of its customer base - a business with no steady customers is not viable and will struggle to turn a profit. 

Understanding who your target audience is allows you to not only know where to find them, but how to craft an offer that will engage and convert them into paying customers. 

An accurate picture of who you’re selling to can give you confidence that your price and products match their needs, allowing you to more effectively scale up your business once that commercial interest has been proven.

Next Step: Nail Your Marketing Strategy

The answers you’ve created to the above questions will form the heart of your marketing strategy, directing your cross-platform messaging and audience targeting. 

Getting the right message to the right people in the right way is key to generating results for your business such as increasing your revenue and building brand awareness. 

Sprocket Digital are experienced at creating effective, efficient marketing strategies for startups and established businesses looking to scale. We know how tough it can be for small businesses out there, but we also know how great the potential is for many, if they get the right support to make it stick.

Ensure your Business Remains Viable

So you’ve got a great marketing strategy in place, you know your USP, your target customer base, and your competitive advantage, but how can you ensure your business remains viable in the long term? 

Longevity relies on keeping your business’ financial house in order, so that you can weather the highs and lows as well as unexpected storms.

1. Cash Stability

This is the most important financial factor for successful businesses: having enough cash and assets for day to day operations, as well as protection against any of the regular ups and downs that are part of running a business. 

As we learned from 2020, many business owners were caught off guard by the sudden lockdown and were not adequately prepared to ride out the alert levels. Hopefully we won’t be seeing that level of crisis again for some time, but it’s a worthy reminder of how quickly things can change. 

Being cash-stable takes discipline. It’s a carefully planned move that ensures your business doesn’t over-extend during the highs times so it can survive through the lows.

2. Continued Financial Attention

To have the confidence of knowing that your business is viable now and in the future, you need to have an up to date awareness of your financial operations. 

Business owners should be regularly updating, monitoring, and analysing their financial situation to ensure they’re on track, cash stable, and in a good position to continue and grow their operations into the future.

We know what it takes for a business to grow - we’ve helped hundreds do exactly that. If you’re ready to take the next step and scale up or share your business with the world, get in touch with our team today.

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Taking the first step is the easiest part with Sprocket Digital. Simply describe your company and schedule a free no-obligation consultation to find out how we can help scale your business and increase your revenue.

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    Covid lockdowns meant complete operational shut down for our small NZ owned business. However, in the last few months we have finally got back up and running again with the help from Josh and his Sprocket team.Their understanding, resources and communication has been unwavering in this process and we have seen measurable results month on month. Trust plays a big role in digital marketing and I believe their formula is full proof.Sprocket has had a big role to play in getting our small business back on it's feet. I couldn't recommend this company enough!
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    We have worked with a couple of other agencies that did not deliver and I'm impressed with the level of service, support & results we get from Sprocket. Within a few weeks of working with Sprocket, we can see immediate improvement on our sales. Harry and the team has taken the time to understand our business and continue to work on delivering results. We look forward to continue working with Sprocket to grow our business. If you are looking for a result-focused agency, you can't go wrong with Sprocket!
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    Nudi Point
    FINALLY... a digital marketing company that actually gets the results. This is the 5th business I have dealt with in the last 7 years - and the only business that has proven results. Our sales have increased hugely and it's only been 1 month. Harry is amazing to work with and the whole team at Sprocket Digital know exactly what they're doing. The results speak for themselves. Highly recommend!
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    I have been working with Sprocket for about 6 months, and the team has delivered outstanding results, giving us one of the best return for every dollar we spent through them. I have worked with digital agencies across Asia, Europe, and NZ over 15 years, but the ROI improvement I have seen Sophie and the team deliver is best in class. If you are a result-focused marketer who needs an agency to get you results, try letting them run your campaign. It worked great for us.
    Josef Arnet
    Sprocket Digital has been great to work with and has provided great inside and addition to the digital side of our business (Kitchen Things) their SEO team is fantastic and Harrison their Email marketing specialist is an absolute savant when it comes to knowing how set up email campaigns, templates as well as automatic email flows and the logic required to make them impactful and effective for a business. They always continue to impress with the work they do.
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    Sprocket has been an incredible digital marketing partner, helping us grow our monthly turnover. They are extremely helpful and are quick to respond to any needs we may have. I would highly recommend for any company looking to take on a digital transformation journey.
    Matt Boylan
    This is the second time I have used Sprocket Digital in my role as Marketing Manager for small to medium sized businesses. Given our marketing team is very small and we don't have a specific digital marketing resource internally, it gives me peace of mind knowing that all our digital needs are being outsourced to Sprocket. On both occasions of working with Sprocket, the team have very quickly got up to speed on our business. The setup is seamless and my regular meetings with the team help to identify opportunities for us to leverage. The entire team are really knowledgeable and down to earth even though they have some very experienced people working on our account. I would highly recommend Sprocket to any other business who wants expert advice and guidance on their digital marketing with an accessible and down to earth approach.
    Phillip Wards
    Harry and the team at Sprocket have done an amazing job for our start up company. It's been an absolute pleasure having them onboard, pushing our sales and helping make our business what it is today, this has only taken one month. Looking forward to many years to come.Thanks team
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    Great start with Sprocket. Particularly like the data driven methodology, transparency and friendliness.
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    Great team to work with, we've experienced growth from day 1 and we're still going! Thank you team Sprocket Digital
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    I really enjoy working with Sprocket. I've worked with them on two different projects now; they're data driven, great communicators & listeners as well as extremely good value/above board. They helped us improve our Google quality and conversions by nearly double. I would definitely recommend them.
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