Honesty Is The Best Business Policy: Here’s Why

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Anybody can start a business.

But not everybody can run a successful one.

If they could, then the world would be overrun with them! In reality, roughly half of all small businesses fail within 5 years of starting up.

Clearly, running an operation that drives revenue and grows in perpetuity is no mean feat.

So what separates the winners from the losers? A lot of factors contribute, for sure. The leadership, the concept, the cash flow, competition, and economy all come into play.

As pivotal as the rest of them, though, is this: honesty.

Why is honesty important to running a successful business? Allow us to explain. It might be the missing ingredient required to sky-rocket your enterprise to new heights.

Keep reading for 7 essential reasons to prioritize honesty in your business.

1. Brand Image

Branding, according to Jeff Bezos (the Amazon founder and CEO), is “what other people say about you when you’re not in the room”.

A quality brand image drives growth and success.

Customers will connect with you, buy from you, tell their friends about you, and keep coming back. If you lack a brand, then you’re nothing but another generic business flogging a product/service.

Your chances of winning in your industry dwindle as a result.

These days, the most successful brands have honesty and integrity at their core. They aren’t trying to swindle their customers; they don’t cover their tracks and point fingers.

They’re open and transparent and prioritize the customer. Bring honesty to the table and consistent business is sure to follow.

2. Relationship Development

What’s at the core of business?

Capital? Investors? Systems? Software?

Yes to all of the above. But there’s another that supersedes them: relationships.

They’re are all-important.

Sure, you need money for growth. Yet it’s the relationship that should come first. Prioritize every relationship your business has and you’re sure to do better.

Your networking will be more effective. Your marketing will be more effective. Customers will like you better, which will make your sales teams more effective too.

In relation to this post, you can’t build a relationship on the back of dishonesty. Honesty facilitates trust (more on this next), which is a primary driver in relationship development.

3. Cultivation of Trust

Bring to mind your deepest darkest secret.

Now, consider the people to whom you’d be willing to reveal it.

The one thing they’ll have in common is one thing: trust. These are the people you trust most in the world not to spread your secrets to others.

It’s hard to overstate the value of trust in business too. Think about it: would you really buy something from a store you don’t trust? If you wouldn’t, then neither will your target audience.

Trust is a commodity that’s hard-earned and easily lost. What’s more, you’ll never earn it if you lack honesty. Let’s face it, you’re unlikely to place your trust in somebody with a reputation for lies and deceit.

Honesty and transparency are at the cornerstone of winning consumer trust. From there, you’ll have fewer questions to answer and a far easier time of selling to them.

4. Self-Awareness

Honesty is at the heart of self-awareness.

And self-awareness is vital for a business to beat the competition. Why? Because how else can you recognize problems that need addressing?

Business leaders must be aware of two things:

What they’re doing right, and what they’re doing wrong. By honing in on the good stuff and steering clear of the bad, your business stands a greater chance of succeeding.

Conversely, a lack of awareness poses a significant hurdle.

Convinced they’re right and the world is wrong, stubborn business owners don’t know when to quit and change direction. They’re more likely to continue with flawed methods and, potentially, drive their business into the ground.

5. Customer Retention

As we’ve seen, an honest approach to business is central to attracting new customers.

But new leads and conversions only get you so far.

If customers leave at the same rate as you attract new ones, then you’re not growing. A revolving door effect takes place; it’s a constant battle to get to customers.

By contrast, the higher your rates of retention, the quicker it is you’ll grow. Customers on top of customers lead to exponential growth. It’s the best way to succeed.

Alas, you’re unlikely to earn repeat custom if you lack honesty. Customers realize their error in using your service. They feel betrayed and look elsewhere in the future. In so doing, you not only lose hard-earned customers but fuel your competitors as well.

6. Business Culture

The culture of your business is another vital ingredient to success.

Who would you rather work for?

  1. The company that mistreats its employees, lacks integrity, and lies, cheats and steals its way to attract customers, or
  2. The company with a reputation for fair, genuine, open and kind operations?

Option b, of course.

The culture you create in the workplace will have a direct impact on employee satisfaction. Employees that are happy work harder. Indeed, they’re known to be 20% more productive!

As we’ve seen, customers appreciate your honesty as well and will become loyal to your brand.

Cultivate an honest, happy environment, then, and everybody wins.

7. Top Employee Interest

Every business wants the pick of the bunch in terms of employees.

Why? Because a bad employee can have severe negative repercussions. They can damage the team spirit, hinder operations, and reflect badly on the company itself.

Top employees are the opposite.

They work hard for the company, contribute to a positive environment, and, ultimately, bring results. This is another area that the brand image you’ve created comes in handy:

A reputation as an honest employer will bring quality prospective employees through the door.

Why Is Honesty Important in Business? Now You Know

A huge number of new businesses start up every year.

Only a relatively small number of them succeed. In your bid for business success, honesty is essential. Hopefully, if you’ve been wondering ‘why is honesty important to a business’, this post has provided the answer.

Looking for an honest company to deliver your basement waterproofing? We can help. Get in touch today to learn more.