Tuesday, September 4, 2012

HOW SMALL BUSINESSES REMAIN SMALL

6 WAYS TO SHOOT YOURSELF IN THE FOOT

Often small businesses have trouble growing or surviving. If they do manage, often they get stuck and look for the quick fix. In a video posted by Watch Me Franchise Amanda covers off the 10 top mistakes businesses's make but I'd like to focus on 6.  


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Recently I was contracted to work with a company to develop their business and help them grow. Now in their 11th year they have not cracked the 3 million dollar mark. When I started to dig I began to understand why and then began to understand that they really didn’t want to hear it. Just fix it. This was the mantra for the contract duration and impossible to satisfy without their collaboration, support and participation. With this learning, I want to share some tips for doing it wrong or six ways to shoot yourself in the foot.

1. DON'T HAVE A VISION

Having a vision for your business is one of the foundations that set’s the path for your future. Without it your brand will remain undefined and uninspiring to anyone who comes in contact with it.


Your vision statement is a clear articulation and declaration of where you want your company to be in the next 5 or 10 years and without it, it’s like being in a sailboat without a sail or rudder and hoping you’ll get “there” eventually. A vision statement aligns your team and keeps you on course. Without it you and your team get caught up in the day to day without having a clue what you are headed toward. Innovation which is critical is often non-existent because there is nothing for innovation to stick to.

2. FORGET THE BUSINESS PLAN. JUST USE A SPREADSHEET


Bottom line is important however if your business plan is only a spreadsheet you will find yourself being a bit myopic and reacting constantly. It is thinking small in a major way. Why? Because your focus will be on money and sort-fall not growth. A spread sheet may have targets attached to it but goals and strategy are missing. Should you have investors and a spreadsheet is all you have by way of a business plan then count on being hounded constantly and getting a big huge ulcer.

3. DON'T MARKET. JUST FOCUS ON SALES SALES SALES!
Whether you are just starting up or you’ve been around for 11 years don’t assume people know you are there. An article posted in MarketingProfs Today talks about this and it’s worth the read, The company I was working with , while doing good work when they got it was flying under the radar therefore getting a sale was a long and often slow and expensive process even for an experienced sales person and especially one making cold calls. Let people know you are there and engage them. If you don’t have a large budget that’s OK you can create a sound strategy that connects with your audience all the same. Social Media is an important tool. Either invest in learning how to do it right or hire someone to do it for you. While this company does have a Twitter and Facebook presence they are not creating inbound marketing opportunity or engaging their community. They do have a decent website. Too bad no-one knows it’s there.

4). CHEAP OUT
By this I mean several things. If you pay your suppliers late you can rack up late fees and penalties. If you decide not to pay them for whatever reason it is the kiss of death. Either way the word spreads and people will not want to do business with you or they will demand strict terms if they do. Companies that are cash strapped in low volume periods often resort to this to buy time. It really isn’t a good strategy. The second thing is mark-up on top of your fees. I know a lot of people do this however, I am not sure I agree with it. If you have a fee model that builds in profitability you shouldn’t have to mark up for the few extra bucks you will make. Marking up on fees is double dipping and you can be known as expensive. I can’t tell you how much business this company lost because their pricing was too high for this very reason

5. TREAT YOUR PEOPLE BADLY AND FOSTER BAD POLITICS

Under-pay, over-work and threaten them, yell at them publically and threaten them with the loss of employment and see what that gets you. I can’t believe that the leaders of even the tiniest business thinks that fear is effective. It affects not only the quality of person you hire but it also affects the quality of work delivered. At the end of the day costs you money through attrition or lost business. Need I say more?

6. DON'T LISTEN AND PLAY THE BLAME GAME
This happens a lot. A business in trouble will ask someone like me to come in and fix it and then steadfastly refuse to listen, collaborate or participate. It’s much easier blame your staff, the client, the latest consultant or coach than it is to actually take a hard look at the inner workings of your business, its philosophy as well as leadership than do the work. This lack of responsibility will again cost you money but hey – it was someone else’s fault right? And that kind of thinking will in the end stop your business dead in it’s tracks.

This isn’t the only company I’ve seen struggle with these issues. There have been large ones as well as small ones and the thing is, something can be done about it. If any of the above hit’s home then maybe it’s time to explore the flip side.


Ellen Smith: Change Maker
@encourse
www.encourse.ca

1 comment:

Michel Babun said...

Inbound marketing is very important for every business no matter it is large or small business. Inbound marketing is the best option to inform the audience about your business and make good communication with them.