Most businesses fail within the first five years of opening their doors. Creating a mature and profitable business can be one of the most difficult accomplishments a small businesses owner can have. The state of our economy has put stress on many businesses that have made it passed that vulnerable stage. This has effectively leveled the playing field for the new and established businesses alike.
Small businesses are returning to the basics in order to survive in this uncertain time. The early 90′s was a tough time for business and I found myself responsible for the success, of multiple stores, for a large retail chain. Although the economy was not as bad as it is today, nevertheless, it was a challenge. I embarked on a campaign of return to the basics. The following list are just some of the thing I did back then, and will work today.
Give the best customer service:
This is a simple principle but very difficult to accomplish. As an owner or manager of a business, this is the one thing that you should become obsessed with. The value of good customer satisfaction can bring in new customers by word of mouth and keep your customers coming back. If your personal budget allows you to eat out one time a month, you will not return to a restaurant that gave you bad service or small portions. It could be years to win that customer back, or never. I can almost guarantee that the experience will be passed along to friends, family, and whoever will listen.
Take advantage of organizations set up to help small business:
There are many organizations out there willing and able to help your business survive and prosper. One would be SCORE (Service Corps Of Retired Executives). They have many programs that can help a small business owner succeed. I recently was talking to a very respected business owner, and he said that for many years pride stopped him from asking for help. When he finally did, it was one of the best moves he ever made. Not only did he get his business finances in order, but also has other successful business owners wanting to invest in his business. Take advantage of these local associations, they can help you fill any weak points in your business. You would also benefit from learning about the SBA funding program and how to get SBA financing.
Know what programs are available to small business :
One of the hardest things to do is keeping up with changes in government programs that could benefit your business directly. Within the past few weeks the President has announced several programs to help small business in America. Just a few of the proposals would be: $30 billion to local community banks for lending to small business, and $33 billion in tax credit for hiring new employees. If you do not keep up with these programs, you could be missing out. I was talking to a CEO of a company that I consult and work for, and mentioned the $5,000 dollar tax credit for hiring a new person. I was shocked that he did not know about the new proposal. Later he explained that he was so busy that he did not even here about it. Don’t get so wrapped up in your own world that you can’t take the time to read or listen to news about new government programs. This would include keeping up with state and local news, as well.
Network with your business community:
Join local clubs and attend mixers as much as your schedule will allow. This many seem like a wasted social activity, that you have better things to do with your time. Don’t take this principle lightly, this is where you can find new clients and create credibility in your local market. Countless stories of small businesses find great customers that help champion their business at these social clubs. Some of my biggest client relationships where formed at social events.
Keep up to date with profit and loss statements and develop a cash flow report:
This may seem like a no brainier, but you would be surprised at how many small businesses do not have a P&L and a cash flow report. If you happen to be one of these businesses, put on your calendar to purchase an accounting program that has these reports built into the program. A business recently spent $22,500 over a six month period of time for a consultant to get their books and reports in order. Don’t take this principle lightly, it could save or destroy your business. Get this one done ASAP.
Write a business and marketing plan:
In the movie The Hunt For Red October, the aircraft carrier captain played by Fred Thompson said “a Russian doesn’t take a dump without a plan” or something like that, can’t remember exact quote. Take his advice, get a plan. How will you ever know where you are going if you don’t have a road-map to get there? Another key element to a business’s plan is a marketing plan. Often overlooked, this particular item has saved me many times. Most of your competition will not do this step, or should I say will not follow what they plan. Keep this plan handy and make sure that you follow it carefully. It could make the difference in a positive or negative cash flow.
Hire the best people and learn to listen:
Although this is the last principle, it is probably the most important. Find a way to attract the best and the brightest in their field. Think outside the box when it comes to compensation. Bringing in the best will have the biggest impact on your business. Many small business owners will cut corners in this area, don’t be one of them. Having an A Team when the going gets rough will give you the confidence to take those big chances that could put you over the top.
Take these 7 principles for small business success and put them into practice. One trick is to concentrate on one principle a week. Always keeping up with the other 6, but put a major emphasis on one. Follow these principles and your chances for surviving the next 5 years goes through the roof.
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What you say is very true. Develop a good business plan and when it comes to searching for financing, some small businesses are financing through cash advances which can be a short term help and provides cash flow.
Thanks for sharing.
Writing the business and marketing plans are key components. They help you stay on track and that is so important. Great post.
Alex´s last blog ..The New Lifestyle of a Retired Entrepreneur
Thanks Alex
Zane Safrit’s My passion is small business and the operations’ excellence required to deliver a product that creates word-of-mouth, customer referrals and instills pride in those whose passion created it. Zane’s blog is Zane Safrit.
Where is the sensibility in caring for our students? They are our future and their future is burdened with a debt before they can begin and now we add high unemployment, economic issues and a vast majority of schools now charge fee for service and a focused on profit projection.
Very very true. Also in today’s market we also should include in our marketing plan our commitment and investment to e-business which should include SEO services and maintenance of your web site.
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