Five advantages a start-up has over an established business+
The economy needs more start-ups and entrepreneurs. For economic growth, job creation and to celebrate pioneering entrepreneurship. Thinking about taking the plunge and starting your own business? Then read our top five advantages a start-up has over an established one as inspiration for your journey.
Ability to innovate at speed
If you think a start-up can’t compete with more established businesses, think again. One of the key benefits of being new and small is it allows you to be truly innovative and reactive. Large companies may have successfully carved a niche for themselves but these can be hard to shake off and hamper their ability to adapt to changing market conditions. The owner of a small business tends to be much closer to their clients, benefitting from immediate and direct feedback, something that the MD of a big business can only dream of. The speed-of-decision making is much faster, meaning the business can react much faster.
Flexibility in its business focus
In much the same way that a start-up has the potential to innovate at speed, it can even shift the business focus altogether if the market dictates a change. A large company may encounter extremely challenging times if the need for its services begins to wane, where as a start-up can shift its focus much more easily whilst it is still in its infancy establishing itself. Trying things out and shifting attention is the nature of many a start-up, whereas the risks are often too great for an established business.
Industry partnerships over permanent staff
A major stumbling block of the speed of innovation that the small business benefits from is that it often requires extra resources, something that a start-up company is unlikely to have internally. One solution is to establish partnerships with similar sized operations and form something of a cooperative, where you pool together resources to complete multi-discipline tasks, work on new offerings or win bigger projects that combine elements from various elements in the start-up pool. This way everyone can grow together and benefit from more business.
Incentivise staff with shares
When you start a company you have shares to play with, which can be a useful tool in securing and incentivising top talent to work for, and be truly committed to, your business. It’s a good way of reducing salaries in the short-term, whilst simultaneously gaining the commitment of your workforce, as they will have a share in the businesses’ success. A great example is Facebook; many of their first employees received shares instead of full salaries, and now they’re looking at their share of a multi-billion dollar fortune.
Lower office space costs
Another practical advantage of start-ups over larger business is the lower office space and maintenance costs. Unless you’re an entirely ‘virtual’ business your staff will need a place to work together. If your office is going to be a point of contact for your customers then it’s important that it looks professional. You need to convey to your customers that you know what you are doing, can deliver on what you are offering and are, basically, a safe pair of hands. A space on a business park can really give you the edge over your competitors and helps to present the right image to your clients.