PrintEmail

A common question is “What should I focus on in business?”  You could do an MBA (Master of Business Administration), but what SME has time for that?

I’d like to share what I’ve learnt about running a small business over 20 years. 

Most businesses have five areas:
1. The product or service you offer
2. Marketing and selling
3. Operations and finance
4. Customer service
5. Human resources

If you proactively manage these five areas, a lot of hassle can be avoided.

The product or service that you offer

Many businesses get started because someone has an idea or a passion.  Unfortunately not enough research is put into whether the product or service is viable and if there is a market for it.  Passion is important in business, but if the idea just doesn’t have legs, it’s going to cause a lot of heartache.  The product or service needs to be well researched to ensure it delivers a solution or benefit.  Research, testing and improvement needs to be ongoing , as markets change rapidly.

Marketing and Selling

Once you’ve found a great product or service and you’ve identified a market, how do you let people know about it?  Marketing is one of the most important factors in business success.  There is no point in having a fantastic product or service if no one knows about it.  If you can’t convey your value proposition, the business will fail.  You must research your market, let them know what you have to offer and the benefit.  Once you’ve got some interest the deal isn’t done yet.  You need to sell to your customer.  You need to engage with them, listen to their needs and find ways to solve their problem.   It is a long road from enquiry to closing a sale and it needs patient and trained salespeople.  A good sales process can have a massive impact on revenue and getting top performers to share knowledge is vital.

Operations and Finance

Once you’ve made the sale, you have to deliver.  There is a lot involved in delivering a product or service to the satisfaction of customers.  Systems are the best way to ensure efficiency.  SMEs are often time poor and lack ways to implement systems.   SMEs complain about being overworked and trying to do everything.  Systems are the solution.  Documenting tasks, especially repetitive ones, will help the business owner be involved in more strategic aspects of business.

Then there is finance to consider.  There are costs and overheads to pay, stock and jobs in progress to finance, debts to collect, equipment to be bought or financed, suppliers to pay, interest to financiers and the list goes on.  Cash flow is one of the biggest issues for SMEs.  It has to be managed proactively with forward planning, such as budgets and cash flow projections.  If cash runs out, the business won’t survive without outside injections.  These can be difficult to source if finances aren’t run effectively.

Customer service

Have you ever heard the saying “The customer is always right?If the customer is wrong, go back and read the first line”?