We often think of business success as a result of something big, something significant or something widely innovative. While that may be true for many organizations, significant business success is often a result of well executed little things.
This paradox is highlighted in two different ways with small business: little things are often the biggest challenges. Likewise, little things, when executed well and consistently, lead to big rewards.
Money issues are often at the top of the list of small business challenges. Whether it be too many bills, unexpected expenses or clients who are sluggish in paying, available cash is limited. Small business owners are typically reluctant to borrow so they end up going month-to-month, hoping that the tides will turn while increasing incremental debt. That monkey becomes a very large burden quickly. The following are some suggestions on how to better keep finances in check:
- Create a budget – it doesn’t have to be complicated but it does need to be realistic. Then stick to it.
- Begin asking yourself, “do I really need this to get the work done or am I satisfying another, non-essential need?” For instance, is your desire to look good driving your decision to buy top of the line equipment?
- Align your business development or marketing expenses with an actual job or return. Just because the expense is a write-off doesn’t mean it is a good expense.
- Have clear terms regarding payment for your products or services. Don’t be afraid to assign late payment fees if necessary.
- Invest in software that allows for online invoices and has work flow processes to remind clients who are late in payment.
- Stay keenly aware of overhead and don’t shy away from offsetting reasonable costs with reasonable fees.
Even those of us who adore what we do get tired of doing it. Small business owners tend to “do it all” and do it “all the time.” While we like to think ourselves perfectly capable, we are often wrong. Burnout causes disorganization, forgetfulness and frustration for all parties involved. Small business owners who aren’t capable of seeing fatigue or burnout in themselves can often do more harm than good to their business.
Try the following to keep your energy and commitment optimized:
- Strategic planning
You can’t do it all but if you take the time to lay out the next 6-12 months of business objectives, you can more easily see who should handle or manage the activities needed to meet your objectives.
It’s foolish to do everything yourself and egotistical to think you’re the best at everything. Furthermore, if you’re doing everything, you don’t have time to do the most important things. Identify business tasks that are better performed by others and delegate accordingly. And engage in contract work, part-time work or even shared service environments when reasonable to do so.
- Automate what can be automated
Many small business owners fail to invest in critical infrastructure such as a client management system, project management software or financial platforms. Their life is consumed with doing things manually and maintaining countless spreadsheets. There’s always an app for that so perhaps you could invest in hardware or software solutions early on to ensure your business is built on an efficient foundation.
- Manage your energy, not your time
It is imperative to be aware of your own body, biorhythms and alarms when it comes to your health and wellbeing. Organizing work around when your mind is best to do that work, allowing yourself a mental holiday or break during a long and arduous project and knowing when you’ve reached your limit will help you sustain the long hours.
- Be realistic about time
When you’re doing it all, it takes more time. There is nothing to be gained by fooling yourself or those you care about and saying you’ll be there in an hour when the reality is you’re looking at three hours of work. Either obey the clock and walk away or schedule and prioritize the necessary time.
- Network with others
Burnout comes fast when you’re isolated. Build upon your professional network and utilize their resources to alleviate some of the needs of your business.
- Call uncle
Small business owners have a hard time asking for help. We need to get over it. We are often the first to assist others and we need to learn that being on the receiving end is just as beneficial.
Having the Right Customers
When I first started my business years ago, I accepted all work I was capable of performing. The thought of turning away a client didn’t cross my mind.
Looking back, I can assure you it made my first few years a lot harder than they needed to be. I spent countless hours, many of them unpaid, performing billable work I should not have been doing. I was four years into my sole proprietorship when I fired my first client due to non-payment and a continued lack of trust. It was about six months later when I declined a project and referred it to a colleague because he was better at it than I would have been. Soon after that, I told a client I didn’t want to do the work because I couldn’t support the intent of why it needed to be done.
It took me nearly five years of lessons before I felt empowered to ensure my services were matched with the right customers. Learn from my mistakes and try the below suggestions:
- Analyze your current client base and segregate them into buckets:
- those you want to continue working with;
- those you will continue to work with but with stipulations; and
- those with which you don’t mind if the relationship ends.
- Next, identify the reasons why clients are in the first bucket; these characteristics should describe your ideal customers.
- Then, brainstorm what businesses and organizations share those characteristics.
- Go after these ideal clients! Make a phone call, have coffee with them, connect via LinkedIn, or track them down at a community event. Tell them why they are the ideal client for you and, likewise, tell them why you may be the ideal vendor for them.
- Leave money on the table. The moment I realized the relationship wasn’t ideal, I needed to walk away from it. I was walking away from revenue but strategically, it was a better move.
- Ask for referrals from your ideal clients. If they know what you’re looking for and what value you can add, they will be the greatest ambassadors for your small business.
Staying Current and Relevant
Small business owners often forget to invest in their own expertise and leadership competencies. Whether they believe it’s a burden, selfish or otherwise, they don’t take the time to keep up on things. I believe if you engage in the following, you will have a better probability of staying relevant in your field and will be more capable of leading your team effectively:
- Schedule “meetings with myself.” Use this time to research competitors, build your professional network and read industry publications, blogs or books.
- Volunteer or serve on Boards for both community and professional organizations.
- Position yourself as a speaker for industry events or write for publications or blogs. Journals and consortiums are always looking for content and I think you’ll find that writing keeps your money where your mouth is.
- Attend professional development events. You’re not perfect and trust me, there is always something to learn.
In conclusion, businesses large and small have the same core challenges but small businesses have less resources to address them. Therefore, the little things can quickly turn into daunting problems. But small businesses are nimble enough to tackle the big challenges with a series of small activities that can be executed immediately. Therefore, small business owners might just have a bigger chance for success.