What is one sign that it's time to pivot your business?
We asked business leaders and entrepreneurs what signals small businesses need to look for when deciding if they need a new revenue stream to offset losses. From losing your passion to using market conditions as your guide, several signs may help you to realize it’s time to pivot your business.
Here are 10 signs that it's time to pivot your business:
- You’re Not Seeing The Results You Hypothesized
- You’ve Lost The Passion
- There Is A Greater Opportunity For Sustainable Growth
- Brand Switching
- Failing Metrics In ROI
- Unsatisfactory Growth Rate
- The Phone Stops Ringing And Orders Stop
- Use Market Conditions As Your Guide
- Development Has Hit A Plateau
- The Road You’ve Been On Is Becoming A Dead End
You’re Not Seeing The Results You Hypothesized
After reading through Eric Reis’ The Lean StartUp, I am very familiar with a business pivot. Reis describes it as a “structured course correction designed to test a new fundamental hypothesis about the product, strategy, and engine of growth." A clear sign that it is time to pivot is when you do not see the results you hypothesized in your previous plan. If things are not working, you shouldn't give up! But instead, change directions and come up with a new course of action with the same goal in mind.
-Kayla Centeno, Markitors
You’ve Lost The Passion
As a business owner, you need to maintain a passion for the business. Without passion, your lack of energy can become contagious and can be passed on to other employees. Fortunately, there tends to be a lot of energy to be gained with the excitement of a business pivot. Whether you decide to pivot or not, keep it fresh for yourself and keep the business fresh for your team.
-Dan Reck, MATClinics
There is a Greater Opportunity for Sustainable Growth
You pivot your business when you realize there is a more significant opportunity for sustainable growth. Pivoting isn’t changing everything about your business but changing the direction in which you’re headed. There’s a difference between an idea needing an adjustment and an idea just not working out. If you have to pivot more than a few times, it’s probably not a pivot but an entirely different concept.
-Zack McCarty, Qwick
Your consumers’ behavior and demands are always changing, and to be successful, you must keep up with the trends. Many businesses have pivoted in the last year due to COVID-19. Some have even seen their business take-off in this new environment. Depending on what sector or vertical you work in, I would say the most significant sign that it is time to pivot is when your customers start switching to your competitors — it is a telltale sign that you aren’t growing with your customers' needs.
-Randall Smalley, Cruise America
Failing Metrics In ROI
Suppose your business reports show failing metrics in ROI or a bottleneck in your sales funnel. In that case, it should become a priority to begin creating a new marketing strategy and even looking for other brand-building opportunities. The data simply can’t be questioned, so it must be addressed as soon as possible when it begins to show a broad picture of decline.
-Greg Gillman, MuteSix
Unsatisfactory Growth Rate
Evidently, because of a well-executed pivot that reconfigured their objectives and put them back on the road of growth, several organizations that initially collapsed eventually succeeded. However, it is always easier said than done to decide when it’s time to pivot, and many company owners fail to make adjustments because they are unaware of when to act. An unsatisfactory growth rate is one common explanation for business-wide pivots because managers are disappointed with the sluggish growth rate the company has experienced. If you are a company owner who is extremely worried about the pace of growth your business is going through, consider it a telltale indication that you have actually struggled to pivot a bit too long.
-Sylvia Kang, Mira
The Phone Stops Ringing And Orders Stop
It’s time to take a step back and see if what you have to offer is still relevant if your target market’s pain points have changed, and/or if your marketing message is reaching the right audience with the right message. I highly recommend working with a SCORE mentor. They offer free business mentoring advice from an objective point of view.
-Giselle Aguiar, AZ Social Media Wiz
Use Market Conditions As Your Guide
Are you working in a sector where the long-term outlook shows negative growth? Do you see an internal decline of performance that matches that outlook? It may be time to look at additional opportunities. While the prospect of a pivot may be scary, keep in mind that you have momentum on your side. If you act early enough, you have capital at the ready to invest in the pivot now, before it’s too late. Take stock of other opportunities that may be present in the same vertical. Nintendo decided to pivot from playing cards to another part of the gaming industry after 100+ years in business with the introduction of the NES back in the 80s. LG made a similar play by taking its manufacturing prowess and expanding beyond chemicals. Know what you are good at and have it lead your pivot.
-Steven Brown, DP Electric Inc
Development Has Hit A Plateau
A plateau in your company’s performance may mean slow or no progress in terms of gross revenue and net profits. The no growth or slow growth can be attributed to various reasons: inefficient processes, an uninspired team, undeveloped products and ineffective strategies. In any case, there is an urgent need to review all these reasons to come up with a strategic analysis and next steps to turn the company around.
-Anton Konopliov, Palma Violets Loans
The Road You’ve Been On Is Becoming A Dead End
It’s very tempting to stay the course, stick to who you were, and fall in love with your genesis story, but the mid to long-term success stories have always reinvented themselves and sometimes a few times over. In other words, plan for what the demand will look like in 5-10 years. If you know the service will get automated within the next several years, that is a gigantic red flag that it is time to pivot as soon as possible. Don’t get lured into thinking that only because you’re doing well now it will continue into perpetuity. Think of Nokia and Kodak who arrogantly rested on laurels as a warning tale and follow the example of American Express and IBM who saw the writing was on the wall and changed their focus before it became too late.
-Bart Turczynski, ResumeLab