Some Tips for Small Business Owners

Running a small business can be a lonely job and keeping on top of the day to day operations can often swamp the business owner. This often results in important trends or events being missed and doubtful decisions having a detrimental effect on the business. It can be difficult to see the wood from the trees.

Here are a few tips which if followed could help to demystify the problems that every business inevitably comes across.

1. Have a Plan

Business owners shouldn’t underestimate the importance of having a sound business plan. The process of preparing the plan in itself is important as it forces you to address the many variables which can affect the success or otherwise of your business. There is no need to spend big money on this but it is important to give it the time and attention it deserves. I particularly like this template from the Bank of Ireland website which I recommend. https://www.thinkbusiness.ie/articles/business-plan-template/

2. Know your Numbers

Every business has some key metrics which are important. Usually referred to as Key Performance Indicators (KPI’s). You need to identify which metrics are appropriate to your business and select five or six which should be monitored on a weekly basis. Here are some of the most usual metrics used.

3. Cash is King

Cashflow is the lifeblood of the business. Cash and profit are not the same. Many businesses which in the long run are viable and profitable have failed because of the failure to manage cash flow. The importance of careful cash management cannot be ignored. This is done by preparing a cash flow budget. Again I recommend the following template.  https://www.thinkbusiness.ie/articles/cashflow-template/

4. Know and Listen to your Customer

Excellence in customer service is key to business success. Know who your key customers are and ensure you listen to their feedback. Loyal customers can be your most ardent advocates and give you sound advice. Customer feedback should be encouraged and this can be done easily using some or all of these strategies:

• Have a customer panel.
• Online feedback channel.
• Phone call to key customers.
• Analysing complaints when they arise and responding promptly and generously.

 5.  Build a strong team

Zig Ziglar the American author said “You don't build a business, you build people and then people build the business”. This is true for even the small business. It is important that you pay good attention to recruiting your team. Don’t rush the process as poor recruitment can cost you dearly in the long term. Careful consideration needs to be given to

• Writing a Job Specification
• Writing a Person Description
• Identifying the appropriate qualifications and experience
• Defining the salary
• Conducting a professional recruitment process

Following successful recruitment, you should focus on the ongoing professional development of your team.

6. Manage the Sales Pipeline

Managing the sales pipeline is a crucial activity for small business. We tend to take our eye of the ball when we are busy and have a healthy sales book. Be conscious of the lead time to generate new sales and keep the pipeline moving.

7. Develop an Online and Social Presence

Decide how you are going to communicate with your market and if social media is important be sure to embrace the various platforms and channels. This function can be carried out by someone who is not directly involved in the delivery of the service. Many companies are now engaging 3rd level students who have a particular skill in this area.

8. Get a Coach/Mentor

Being a business owner can be a lonely job and business owners should consider engaging a coach to assist them on their journey. Mentoring schemes can also be very useful. Local Enterprise Offices (LEO’s) in every county or schemes such as www.bizmentors.ie  are a useful place to start. Also you might consider asking a friend or family member with business experience to provide mentoring.

9.  Have Plan B / Contingency Plan

One of the first casualties when something goes wrong in your business is your reputation. It is very important to have a contingency plan to deal with possible shocks to the business and to protect your good name. These shocks can be internal or external.  The first step is to carry out a risk assessment of the likely pitfalls for your business. Having identified the risks, a comprehensive crisis plan should be developed. Typical issues that can derail a business include an accident, breakdown in machinery, theft, food poisoning, bad PR and any amount of other shocks depending on the business. I will return to this in future blogs.

The advice given to young hurlers by their coach to “lift up your head and look around” can be equally valid for business. We need to be able to “lift our heads” from the task and get an overall view of the direction we are taking. Time spent in this type of planning will repay itself in spades.

About the author: Myles McHugh is an experienced business professional based in Galway, Ireland. He holds an MBA from NUI Galway and is an experienced mentor and coach. Myles can be contacted at [email protected] .