Often associated with a startup business, is a pivot. For the first year or two, a startup business spends the time testing the market, analyzing numbers, making adjustments, and finding the right path. In some instances, the business is not profitable and will need a new direction, which is known as a pivot. This is not limited to startup businesses but can occur to an established business as well. It may be time to pivot in the event technology changes, the market changes, or new competitors arrive. Today, we at Mark Dicus & Company would like to elaborate on a business pivot. For example, like IBM, you may move from making typewriters to computers to business services, or like Apple, going from making desktop computers to smartphones. Where pivoting is a big decision, you need to be well-informed with the information below.
Signs Your Business Needs to Pivot
1) A Market Change. Industry may be the change in the market, think coal to solar. Leading from new tastes from generation; like millennial’s.
2) Reduced Morale. A team showing signs of burnout or, worse, apathy can be a sign you are headed in the wrong direction and a pivot is in order.
3) Loss of Customer Enthusiasm. Business is lessening and customers are losing interest for your products or services is another indication. This extends beyond customer ratings and seeing a drop off in the passion for your offerings.
4) No Customer Response. Even when you believe in your heart you have the right product; the consumers may not respond positively. In an attempt to demonstrate the value, you might be spending too much time and money.
5) A Decline in Profits. Lack of profits or growth is fairly obvious. The financial reports can tell you the answers you need.
6) Advanced Technology. Your company is left trying to do things the old way, the market is shifting, or has shifted, and to a new technology, is indicative that your product is simply outdated.
Deciding to Quit, Persevere or Pivot
The first thing to do is analyze the foundation of your business when deciding to pivot, persevere or quit. Along with your own drive, this includes your financial standing, and your team. If vulnerable and integrity is low, the decision comes down to pivoting or persevering, should the business still be in good financial standing, you’re passionate about the business, and your team is with you.
Examples of Business Pivots
Below are a few examples of business pivots.
YouTube. Initially, YouTube started off as an app where singles could upload their videos. They quickly saw the potential of all people hosting videos of all kinds.
Odeo. Starting as a podcast finder app, Odea is better known today as Twitter.
Starbucks. Starbucks began selling espresso makers and beans.
AirBnB. Not as the general consumer market, the AirBnB started with a focus purely on convention goers.
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There are countless examples as to how businesses pivot. Sometimes you need assistance and having an accounting and consulting expert can help you. Call Mark Dicus & Company and let our professionals assist you.