What Exactly Is a Small Business?
The Australian Tax Office classifies a Small Business as a business with an annual turnover less than $10 million AUD. Generally, small businesses have less than 20 employees.
Here are some interesting stats:
Similar to the US, around 95% of all businesses are small businesses
Small Businesses contribute around 33% of Australian GDP
There's around 2.5 million registered Small Businesses in Australia
Average 3 year survival rate of all new Australian Small Businesses is 40%
That's right, 60% of all new Small Businesses fail within 3 years!
Why Do Small Businesses Fail?
There are a number of reasons that are outside of a business owners control for why businesses fail. Then there are reasons such as low demand, poor market-fit and so on that is outside of the scope of this article.
But many otherwise viable business fail for these main reasons:
Mismanagement!
Mismanagement!
Mismanagement!
It's tough love, and inimitably true. Because starting a business requires so much from the founders, who have limited time and money resources, any wrong decision could just be the final death knell.
Success requires an analytical and methodological approach. So without further ado, these are the 3 crucial steps to buck probable failure in small business
3 Crucial Steps to Buck Probable Failure
Be a Triple Threat
By far the biggest hurdle, but as Michael E Gerber notes, you need to be able to play the roles of multiple people to succeed:
The Practitioner - 33%
The Manager - 33%
The Entrepreneur - 33%
Ideally, you would be equal measures of each. As a Practitioner, you are the expert; as the Manager, you're improving business processes; and as the Entrepreneur you're focussed on growth.
Choose Your Growth Engine (and stick with it)
Many small businesses struggle to reach and attract their target audience due to ineffective or outdated marketing strategies. Poor visibility or lack of brand awareness leads to low customer engagement, making it difficult to generate consistent sales.
A Growth Engine is a systematic approach to growing and retaining customers. Choosing a growth engine that is appropriate for your business and sticking to the experiment-based methodology will increase your chance of success.
Effective automation
Technology allows businesses to do more with less, and small businesses that are unable to keep up with technological advances will not be able to compete.
Business automation can be a game-changer for small businesses by streamlining operations, improving productivity, and reducing costs. If you as the 33% Manager can set up effective automations for your most common business processes, you will free up the other 66% Practitioner and Entrepreneur to do their best work, giving you a leg up over your competition.
Conclusion
Small business success isn’t just a stroke of luck - it’s a combination of strategic management, growth-driven focus, and efficient automation. To thrive, you need to be a "triple threat": embodying the Practitioner’s skill, the Manager’s efficiency, and the Entrepreneur’s vision. Embrace a growth engine tailored to your market, lean into automation to maximise your impact, and keep the mismanagement pitfalls at bay. With the right approach, your small business isn’t just surviving, it’s on track to flourish and leave a lasting impact.
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