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Business traction refers to the progress of a start-up company and the momentum it gains as the business grows. There is no one way to measure traction; however, companies usually rely on customer response and revenue as indicators of their success. The reasoning behind developing traction is to grow the business while meeting specific company goals and objectives. While traction may be a seemingly abstract concept, it is important and helps a company understand where it stands in an industry and where it would like to be.

While the concept of traction is important for the company founders and employees, it is of equal importance to investors or other stakeholders who have an interest in the organization. The higher the traction, the more investors are attracted to the organization. Consequently, the more investors, the more funds are available to help your business succeed. Therefore, developing a high level of business traction is important to any start-up business and should be a large part of its business growth plan.

Understanding the future of the organization, developing specific goals and a means to reach those goals, is the first step for successful start-up. Clearly stated goals in both a business plan and mission statement shows investors how the company will progress in relation to marketplace factors and competition. However, simply defining these goals is not enough. To measure traction, the company needs to understand what metrics it will use to define success. Depending on the industry and external marketplace factors, traction may be measured through sales, customer response or market research.

The most well-intentioned organization with a clear business plan may still struggle with traction. While there are many reasons start-ups fail, one of the most common is lack of product or brand awareness. As competition increases in the marketplace, smaller businesses with little-known brands or products are often overwhelmed by larger, more established brands. Therefore, to avoid this pitfall, new companies increase advertising and marketing efforts. In addition, if the product or service is not generating customer demand or is priced too high, a company will lose its foothold in the industry. Only by careful research and reaching out to customers can a company regain its business traction and continue its path to success.

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