More Business Start-Ups Succeed Closer to Home
A business start-up can increase their chances of success and longevity by nearly 10% according to a joint study by Yale University and Aalborg University in Denmark if the entrepreneur(s) starting the business have lived in their market area for over six years. Company earnings were also over $8,000 higher annually.
It makes perfect sense when you consider the number of businesses started by local entrepreneurs that fail before they hit the three year mark. It’s difficult enough to get a new business off the ground when you know your local market well. Those same individuals starting a brand new company in a brand new market in which they have never lived have proven to have slimmer chances for success. Some reasons for this are:
- Getting acclimated to living in a new area in and of itself takes time away from building the business. Anyone who has ever relocated to a new city can attest to the fact that setting up a new home, getting kids registered and acclimated to new schools are just a few of the activities that take many hours away from being at the office.
- A lack of a solid customer base from which referrals to potential new clients aren’t available.
- Not having a solid advisory team in place to help with critical business and financial decisions. These advisers would include a local banker, accountant, insurance/benefits broker, attorney and others.
- Incomplete knowledge of major competitors: their strengths and weaknesses.
- More challenging to hire top talent as a start-up without the company principals having a strong reputation locally.
These are just a few of the challenges a start-up in a new market is faced with. What others would you add?
Regents Bank assists local businesses, both new and established. With over 10 years experience in the San Diego we are positioned to help you achieve your business goals. Regents has offices in San Diego, La Jolla, Carlsbad and El Cajon. We also have a full service branch office in Vancouver, WA. For more information on how Regents can help your business grow visit www.regentsbank.com.