SMALL BUSINESS GROWTH

Small Business Growth

Helpful information on how to ensure your small business survives - part 1

The reason for marketing is simple: to attract more people to your business. However, it can be expensive, and if not done properly, ineffective. This has made it a tricky issue for startup businesses with small budgets. To work, marketing campaigns must be carefully targeted at the desired audiance meaning there are few generic 'must do's'. However, there are some marketing disasters that all businesses should definitely avoid.

1 - Not communicating effectively with your existing customers

If this is the case, why are so many businesses so ineffective at communicating with existing customers? Here is an example that we can all relate to. Think of all the ads in your local newspaper for restaurants. Imagine all the money the restaurant owners are spending on these ads. Now ask yourself this question: When did you last receive a letter or an email from a restaurant you've visited, asking you to come back, or offering you a free bottle of wine if you bring your family? What would happen if your local restaurant asked for your email or your address at the end of your meal so that they could keep you informed on special offers, incentives, or perhaps to enter you into a prize draw for a free meal. What would happen to the first restaurant in your area to apply this systematically for the months and years ahead?

Now apply this principle to your business. Here are some useful questions to ask yourself. How often do you communicate with your existing customers? What do you have to offer your existing customers? What are you not offering existing customers that you could be offering them? When did you last send a letter to your customers? When did you last email them? Did you measure the response? When did you last call them? What would happen if you doubled your contact with them this year? When you do communicate with them, what more could your be doing to clearly explain the specific benefits that they will experience?

I once had a client who generated £300,000 by sending a brochure to their clients once a year. I asked what would happen if they sent the brochure twice a year. The thought had never even crossed their mind. We did it (and a lot more) and it generated a fortune for my client.

This may sound ridiculously simple but it is not an unusual story. We are all so close to our businesses that it is often a challenge to step back and look at the obvious - the elusive obvious.

When I start working with a new client, I know without a doubt that they are sitting on a goldmine. This goldmine consists of the wealth that is hidden in their relationships with their current customers.

Here are some more useful questions to maximize your relationship with existing customers: How often do you communicate with your customers by direct mail? Do you test and measure the response? Do you spend at least 15 minutes each month thinking of an exclusive offer you can make to your existing customers? Do you say ‘thank you' to your customers either by letter, email or telephone? Do you ask your customers for referrals? Did you know that there are at least 90 ways of getting referrals? If you have a limited service or product line - do you know of additional companies, products or services that your customers could benefit from?

1: Be flexible with a small business

Flexible working laws introduced last April require you to let parents of young children work varied hours or even from home.

Take advantage of the rules by letting more staff work at home, allowing you to downsize your workplace, saving you money.

Improved broadband access and other devises, such as SMS messaging and email, should allow you to keep in touch with employees and maintain productivity.

2: Overcome skills shortages

Train up - Skills shortages are a big problem in UK workplaces.

To help combat the problem, the government has extended Employer Training Pilots across England, following a successful trial period.

The scheme allows you to train low-skilled staff towards a vocational qualification, with the associated costs met by the government.

3: Expansion with a small business

Expansion - With small business confidence rocketing and the economy set to emerge from its downturn over the next 12 months, this could well be the time to invest and expand.

Maybe you could update your business plan if you are doing well and take on a few extra staff.

If demand is great enough and you can budget carefully, new workers could drive your business onwards and upwards.

- Alternatively, how about branching into other areas? If there is a niche market being ignored in your local area and your business is doing well, why not exploit it?

Do some market research on demand and how any potential expansion would fare - be careful not to over-stretch yourself.

However, a targeted, well thought-out expansion into a closely related field could prove to be very profitable.

4: Don't bank on banks with a small business

Don't just bank on banks - Research has shown that the majority of small firms go to their high street bank whenever they need new finance, despite the fact many are unhappy with the level of service and the charges that banks impose.

If you are looking for more capital, why not consider other options such as venture capitalists, business angels, or, if you are struggling to make ends meet, factoring?

Although not all kinds of businesses can gain such help, it is well worth a try if you need a cash injection.

5: Go public with a small business

The government has announced that red tape on securing public sector contracts will be cut and that work will be awarded on a regional, not national, basis.

Both measures are good news for small firms, who can now compete against a reduced field at a fraction of the cost for government contracts.

From pavement maintenance to IT work, there is around £13 billion worth of contracts out there - so what are you waiting for?

6: Get your message across with a small business

Get your message across - If you have spent the last year relying on local newspaper adverts or the Yellow Pages, it may be worth widening your options slightly to help boost your business.

Cinema advertising often proves effective, as does panels on the side of buses.

You may want to put together a radio advert to reach out to local customers.

If you come up with a targeted, attention-grabbing campaign at a reasonable cost, you should be able to boost takings significantly.

7: Get supplied with a small business

Get supplied - Getting quality, affordable stock is essential in making your business profitable. If you feel that you aren't getting the best deal from your wholesaler, do something about it. Most are happy to negotiate over prices and good wholesalers reward loyalty by offering money off or extra products to repeat customers.

If they don't, find another one. Do some research on suppliers in your local area - if all of them don't offer good value then look further afield - the savings you make could be critical.

8: Get paid on time with a small business

Get paid on time - Late payment has been seen by many businesses as acceptable practice for many years, putting small firms in debt that they can little afford.

With tardy payers being one of the biggest obstacles to profits and expansion, its important that you act to get what's owed to you.

The government has introduced legislation over the last year to tackle the problem, allowing firms to take clients to court for compensation.

If all your chasing proves fruitless, consider using these laws

9: Keep the cash flowing with a small business

Keep the cash flowing - Debt is not necessarily a bad thing for small firms attempting to grow.

However, it's essential that you keep up with repayments or your whole business could be at risk.

Make sure you operate a well-organised cash flow system - try to negotiate repayments so that you can pay in instalments when it suits you best, try to use a business debit or credit card to cut down on paperwork, make sure your records are well looked after and ensure that you are aware of all outstanding debts.

10: Have an up to date business plan

You need to know where you are going and how you are going to get there. You need a map that you have developed showing what you need to do to achieve you financial goals. It's no good selling a product that costs £100 for £80 or investing in a flash website for £5,000 that no-one visits. Write down the exact steps you need to take and then tick them off as you achieve them.

Sample Business Plans
Download a fully completed business plan for your industry online right now.
Includes narrative, financials and support