How to Make $1 Million in Your Small Business

There are millions of small business owners within the United States and around the world. Together, they form a vibrant core to many national economies. However, a large portion of small businesses do not survive. According to the U.S. Small Business Administration, only about half of small businesses survive for at least five years—never mind making it big.

Almost every small business would like to grow its revenues, but most are only working with small teams of employees. While some marketing and growth tactics that work well for large companies can be applied to small businesses, many cannot. Growing a new business from scratch is even more unique.

Read on to find out how to grow a small business and bring it to the big leagues.

1. Be an Industry Thought Leader

Start a podcast, post regularly on social media, speak at industry events or even publish an e-book on your niche area of business. Become the expert that people seek out when they need a solution. If you market yourself enough you will be receiving warm phone calls from individuals wanting to buy from you instead of potentially cold calling on individuals who have no interest in your business. 

This is the least expensive suggestion on how to grow your business—there are plenty of platforms available for you to produce content on, and usually at a relatively low cost or free. Invest an hour a day in learning about your market and writing about what you learn. Within one year, you may very well have potential customers and joint venture partnerships approaching you. This strategy works for all types of niches, including dog training, hedge fund investing, copywriting, fundraising and physical therapy.

Every niche has an online audience looking to learn more about the subject. Start feeding them with valuable content and they will start feeding your business with leads and marketing opportunities. This tip is provided first because it has helped thousands of businesses grow to more than $1 million a year in revenue.

2. Make Passive Income Streams

Subscription-based models and membership programs sell a customer once and then continue to earn a profit every month as long as the customers remain happy. An example of this model is the trendy sports news subscription service known as The Athletic. The sports media property charges a monthly or annual subscription fee to readers in exchange for delivering quality journalism from an all-star team of sports writers without advertisements. As long as the paying subscriber finds value in The Athletic, this stream of revenue should continue to generate income.

Passive income models could incorporate a low monthly fee for on-demand customer service or maintenance, subscription access to exclusive services or even a personalized experience that syncs to all of your internet devices.

3. “Up Sell” Your Customers

If you have a customer who loves your product, perhaps they would like a premium version of that same product or a second one for a coworker or a family member. One of the easiest ways to quickly grow your business is to earn additional sales through your current customers.

4. Over-Deliver Whenever Possible

Word of mouth is the most powerful marketing tool that you can employ. Many large corporations spend millions of dollars on marketing only to pay their customer service personnel closer to minimum wage. This is their area of vulnerability—your small business can create more personal relationships and provide better customer service than most of the large players in the industry.

5. Conduct a Competitive Analysis

Analyze your top five competitors—everything from product lines, prices, digital presence and level of customer service. Take notes and come up with ten new ideas you could use from each of these competitors. If you do this once a year, not only will you keep up with your competitors as they innovate and evolve, but you will leapfrog over them as many others will not do this hard work. The combination of new ideas will lead to some creative solutions for your customers.

6. Stay Focused and Positive

Your business is an investment—changing your environment by spending time with other motivated individuals can help you remain focused. Become a student of positive psychology, and clear your office and workspace of distractions. If you get up early and start each day by studying your industry, your competitors and your top-level goals, you will work more efficiently and gain an edge on your competition.

7. Sell Globally

Choose one to three target markets outside of where you are currently operating and identify would-be competitors there. What do they charge? What products do they offer? Call or email these companies as time permits, and introduce yourself. Tell them you are doing research, as many will be happy to lend some advice or tips.

In a worst-case scenario, you will find that there is no way to expand abroad, but you will probably come across another product idea or customer acquisition strategy by completing the research and seeing what the industry is like within other regions of the world.

8. One Million Is Intimidating

Work toward a million a year in revenue backward. If you want your business to generate one million dollars a year, that means you must make $83,333 a month, or $20,833 a week, or $4,166 per business day.

That is a lot of money to earn every business day, but what new products or services could you add now that could possibly earn that much within one to two years? Think in terms of leverage, developing systems and residual passive income streams. Every minute of time you spend should be seen as an investment.

9. Look to Acquire Businesses

Who are your competitors? How are they doing business-wise? Are they about to retire? Most businesses sell for two to five times their annual earnings or profits, and many parties who are interested in selling end up simply closing shop after not finding an interested buyer.

You may often be able to pick up a business that, when combined with a business you already own, could pay for itself within 12–18 months. This is one of the most expensive but quickest ways of reaching a million (or more) a year in sales.

10. Experiment and Test the Market

Many business owners find that it is only through listening to customers and/or trying to offer a dozen business services or products that they finally find one that really resonates with their target market and takes off in terms of sales. Each experiment that you try will teach you something about your business and customers.

A great amount of the largest, most successful companies in the world have market-tested thousands of products to develop their eventual portfolios of one- to two-dozen product offerings. Hard work creates luck and if you experiment long enough, you will find something that sticks.

The Bottom Line

While this list is not exhaustive, it should help create some momentum and spur creative thinking on how to grow your business. As these tips may apply more readily to certain businesses, those that appear most foreign to your industry could be particularly valuable as it is less likely that the competition has already used them.

Read the original article on Investopedia.