This list of 13 business tips for small business owners serves to provide some tips and advice for small business owners.
Running a small business isn’t easy! It can quickly turn into being reactionary and putting out fires left and right.
The aim is for these to serve as a launch point to your next breakthrough.
1. Market Efficiently
There are truly countless ways to get word out there for your business. Costs to do so can range from free to $5 million for a 30 second Super Bowl ad.
It can be easy to overlook the free grassroots marketing methods – and this can be a critical mistake.
Many networking/referral-based outreach methods can be extremely high-impact.
Free marketing – higher impact – sounds good, right?
We cover a whole variety of marketing methods, paid and free, in this blog article.
2. Study The Competition
Though it is important to differentiate yourself from the competition, many valuable lessons can be learned from observing their actions and decision-making.
For instance, with marketing, if you see them run a short-lived campaign, chances are it was unsuccessful, and you’d probably be foolish to do the same.
Have they been consistently advertising on the same billboard for 5 years? It’s likely this is for a good reason.
These observations won’t be indicators for guaranteed success or failure, but they can be valuable pointers – almost like free small business advice from the competition!
These actions will have generally cost your competition money, and you’ll be able to reap lessons from them for free.
3. Keep It Simple
Stick to a vision, and when presented with a new opportunity, determine if it fits in that vision.
Ideally, what this will result in is simplified processes, efficient resource usage and clearer messaging.
4. Be Intentional When Crafting A Company Culture
Company culture is critical for many reasons. By having a clearly established culture, this will help you with staying on track with your big picture vision.
It will also help your employees in doing the same with their day-to-day decision-making.
Here’s how this can help you, your employees and your customers:
Let’s say that the culture you’re trying to foster is one of “delighting our customers is top priority”. This will make decision-making easier from the moment you start evaluating who to hire.
Wondering which candidate to extend an offer to? Hire the person who fits with your cultural vision.
When training this new hire, make it abundantly clear you hired them because you believe they understand the company culture.
When this hire comes across a situation that has multiple approaches (which could all be valid under various visions), your hire can go with the approach that will “delight the customer”.
Ideally, this will result in:
- A more cohesive team
- A clearer vision to guide management for big picture decisions
- A framework for employees to refer to when presented with decisions
- A more efficient team because they can trust their intuition, rather than pull their manager away from what they were doing
- Happier customers – due to more consistent service and a clear message
Ray Dalio covers this in great detail in his book, Principles, and touches on it in this interview.
5. First Who, Then What
This is a concept that Jim Collins covers in his book Good To Great.
While most business owners know that good hires are important, Collins has evidence that it’s even more important than most would think.
This book studies the common threads between big, established, yet somewhat unremarkable companies that suddenly went through sustained growth and excellence.
“The good-to-great companies understood a simple truth: The right people will do the right things and deliver the best results they’re capable of, regardless of the incentive system.”
Another finding that he had was that often these companies didn’t have a vision prior to hiring the right people.
They got the right managers in place and then the ideas came after. In this sense, the people are more critical than the ideas.
After all, what good is an idea if your team will get in the way of its implementation?
6. Existing Customers Need Recognition
You’ve probably heard this classic small business advice:
“It’s cheaper to keep a customer than it is to earn a new one.”
With this being such a widely-known business tip, you’d think that more than 6% of small businesses would focus on keeping customers, right?
A customer who feels valued is more likely to:
- Do more business with you
- Refer you to their friends/colleagues
- Write positive reviews for you online
- Provide helpful feedback (as opposed to write a bad review online)
In other words, an existing customer is not only a source for revenue, but they’re a source for new customers.
7. Perfection Isn’t Necessary – And Seeking It Might Be Harmful
There’s a reason many startups launch when they’ve assembled a Minimum Viable Product (MVP). Most things in business are iterative.
It’s impossible to know what the real-world result will be until you test it in the market.
Additionally, there’s a significant opportunity cost to investing time and resources into something without allowing it to be out there making an impact.
Let the market shape your products, presentations and processes.
8. Think With Scaling In Mind
When developing a new product, service or business process, ask yourself – “how will this scale?”
For instance, a way of delivering customer service might work well when you’re small, but then become burdensome when you have scaled up.
Now, this might be ok if it is a catalyst of growth and could be filed under “good problems to have” if your business is taken to the next level.
You just don’t want this to be a surprise if you can avoid it.
This is especially true if there were an alternative that could have been taken that would have eliminated the need for changing things with scale.
9. Be Proactive With Your Time Management
When you’re taking on a new project, have time allocation at the forefront of your mind. Budget how much of your time, as the business leader, will be required by this.
You should view your time as an investment.
As you “spend” your time, what are the short term and projected returns?
10. Don’t Ignore Ugly Truths
“Facts are better than dreams”Winston Churchill
It’s easy to ignore ugly truths, especially for a small business owner, who has no shortage of things to occupy one’s attention.
However, when there is an ugly truth looming in the distance, it’s critical that resources be spent addressing this, rather than further embedding oneself in the status quo.
A great example of how failing to do this can topple giants is in the case of Borders Books.
They delayed investing in e-commerce, then became overly reliant on Amazon in their partnership for online book sales. They didn’t start their own independent e-commerce presence until 2007.
By that point, it was too late and they went out of business three years later.
The ugly truth for Borders was that e-commerce was becoming the preferred method of shopping for their customers.
They were going to either need to differentiate themselves or invest heavily in developing an online presence. Ultimately, they chose the half-measure approach and partnered with Amazon to handle their e-commerce.
Perhaps if they had taken the threat of e-commerce more seriously they would still be in business, like Barnes & Noble?
11. Find Your Hedgehog Concept
Here’s another concept from Jim Collins’ Good To Great. The story behind this funny name can be found there.
Collins found in a study that business leaders who were able to turn a solid company into a thriving one all led their companies with a clearly defined vision that focused on the intersection of three concepts:
- What are you deeply passionate about?
- What can you become the best in the world at?
- What drives your economic engine?
When businesses’ product/service and roadmap focus on that intersection, great things tend to happen.
The opposite is being a business that tries to be great at many things and then becomes inefficient and unfocused.
12. Work Backwards
What’s your goal?
It’s a lot easier to know what to do next if you know what you want to be doing in 5-10 years.
This is also a great way to try to anticipate future challenges, and to perhaps be better prepared to address them.
13. Direct Yourself And Write An Action Plan
This is a lesson from The Effective Executive, by Peter Drucker. He also discusses the subject in this Harvard Business Review article.
As a small business owner, there is no-one to manage you.
Even if you have a board or investors to answer to, are they going to look over your shoulder and instruct you on how to spend your time?
Of course not. It’s up to you.
So, you should take a look at how you spend your time and pretend that you are advising someone else.
A great way to accomplish this is with an action plan.
Being reactionary isn’t a good way to be productive. So, a good way to combat this is with an action plan.
Determine what you would like to accomplish in the next 18-24 months and get it in writing. Refer to the action plan as you progress and revise it as you realize wins and losses.