3 Things All Small Business Owners Need to Know.
- Admin
- Oct 29, 2017
- 3 min read
New and Small businesses are fighting an uphill battle. This is not only because they do not have as much money or influence as some of the bigger corporations, but also because they do not know how best to run their businesses. As someone who started a business that saw success before it was sold, I can tell you with full certainty that most business owners don’t know what they are doing (to no fault of their own).
Ok, put down the pitchforks and hear me out.
If you are a baker in Greenville, South Carolina who specializes in custom cupcakes, what do you know about depreciation or amortization?...Probably nothing
If you are a self-employed taxi driver in the hills of Colorado Springs, Colorado what do you know about Cash Flow?... Not too much
If you manage a His and Hers boutique parlor in the heart of Atlanta, Georgia, how well versed are you at structuring your business to give you a massive tax shield?...You aren’t at all, and no one would expect you to be.
Most who start small businesses are EXPERTS at their trade but novices at how to keep them afloat. Additionally, most small businesses don’t have the extra money to hire a full-time business operations manager. So you are left with two options
Hire a consultant from one of the big firms, or a contract strategy consultant like me (Hint: I will charge you A LOT less than some of those other guys)
Try to figure it out yourself, and hope you aren’t losing out on sales or savings while you do
I would like to offer a third option. Learn your business and what influences it.
I have been consulting small businesses for the last 3 years now and I can say that this is a constant unknown to most business owners. It is like the Wild Wild West with some of these guys, so to save you all some time and money, here are 3 need-to-knows that will help you grow your business into what you had envisioned when you started your journey.
Know What Industry You Are In
This seems like something that everyone automatically knows, but you will see in a minute that there is more to it. You should take a hard look at every industry that you currently (or could) serve to maximize your portfolio and offerings. A great example is McDonalds and their added offering of convenience. The McDonald brothers were really good at making decent food quickly, but it wasn’t until they went into business with Ray Kroc that they realized how important location was for expansion. Though they gained success focused on the industry they knew they were in, they would not have achieved global dominance in the fast food industry without considering the impact real-estate had on their business.
Figure Out What Affects Your Industry
You do not live in a bubble, so staying informed is key to your business success. You should know what is going on globally (and if not at minimum nationally) and how it could impact you, so you can plan accordingly. For example, if you own a Chinese restaurant that only uses gas stoves, I would keep an eye on news from the Middle East (or new from southern states) to see how my business could be affected. If war, political changes, or natural disasters threaten those areas, I might host specials for the menu for popular menu items to generate a little more income to prepare for the inevitable increase in gas prices.
Realize Where You Lay Within Your Competitors, and Use That To Your Advantage
You don’t need to be a huge company to do well for yourself, as I hope you well know. In fact, smaller businesses are able to catch a lot of the business huge companies aren’t focus on. This comes with specialization, and knowing where you can compete. An example of this could be a grocery store like Food Lion, and how it has to tailor its offerings to the majority of the US consumer market. There is a finite amount of space that each store can have, and their offerings can only vary slightly for regional tastes. This gives local store owners the ability to tailor their stock directly for the communities they serve, and catch those dollars that are being left on the table. To be clear, you would want to keep some stuff that most every consumer would want (like bottled water and bread), but if there is a locally popular hot sauce that everyone in your community likes, you can put it on your shelves way faster than the larger chains could.
Know what makes you, YOU! Own it, and lavage it to help your business grow.
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