There are several foundational strategies that every entrepreneur can use to grow your small business. Though the next 5 suggestions are simple, they can and will have a significant impact if done in the right way. It’s often forgotten that making very small improvements throughout the year is better than making two or three drastic changes. Start with one of the items below and make your way through the list in 2018.
The first thing you need to do is to make sure you have as much data as possible. These metrics fall into three basic categories. Metrics related to the state of your business, metrics related to your customers, and metrics related to your staff, culture, and productivity.
The first category, business metrics, is the easiest to start with. You should already be measuring profits, inventory costs, and cash flow. You should be tracking how much inventory you sell or how often you sell a service. Keep track of the seasonality of these products and services as well.
Customer-related metrics are the next thing you need to track. With this, you’ll need a system in place to measure the size of your customer pool, how long customers stay with you, how often they buy, and your churn rate.
The last category is a group filled with both soft and hard metrics. This is harder to gauge and quantify. For example, if you happen to have a high employee turnover rate, doing a little research into this data could save you from having big headaches as your business tries to grow.
For all of the above, there are automated solutions out there that will do much of the data gathering for you. The more web-based your business is, the simpler these solutions will be to implement. In fact, most small to medium-sized companies that are growing fast will be using some form of artificial intelligence or machine learning to generate actionable insights or potential paths to opportunity from this data within the next few years. If your business is entirely offline, it may be in your best interest to get a professional on your side, like an accountant.
Learning from others does not mean that you should follow in the footsteps of another business. It merely means to analyze the competition and what they’ve done in the past. In many cases, this will show you what works and where there is still room for improvement. For example, if you have a direct competitor, what do their customers complain about most? Is it something that your business falls short of, too? Or is it something you do better, or could do better?
Another tactic is to keep up with your reading on how business works in general, on your level and higher levels. Beyond just your industry, look at companies that are extremely successful at the moment. Larger organizations, especially those that have successfully adapted to the times, are worth studying. By reading about these businesses, it’s possible to get a glimpse into the mindset and structure that has sustained their business. Then, as your business grows, you will have insight into what is necessary to build a sustainable business model instead of putting effort into unnecessary things. By doing a little research now, you can begin to future-proof your business.
You can’t build a business based on a pool of customers that keeps shrinking or jumping ship. Sure, you can continue attracting new customers, but if you can’t keep them around, your business isn’t growing.
The first step to customer retention is to figure out what your retention and attrition rates are. Your retention rates are the number of customers that have stuck with you over a period. Your attrition rate, on the other hand, is the number of customers that have left your business for another. Subscription and service-based businesses have a much easier time calculating this than a company that sells non-consumable products, so, for the latter, allow some room for error.
Retention rates vary wildly based on industry-specific standards. The higher, the better, but if your industry average is only 45% year to year, aiming too high may be more stressful than it’s worth.
Once you know your retention rate and have a way to track it, then you can work on improving it. This might include simple things like expanding your customer service channels or updating customer service policies. You can send an incentivized survey to your current customers to get their feedback or sift through the complaints you have received.
However, if your retention efforts are all feedback-based, remember that one complaint, or a small number of similar claims, can be outliers. That or your business may not be equipped to offer everything your customers ask for. Start with the smallest changes that come up the most frequently. Fixing five small usability or policy issues is likely to make a much more significant impact than offering a specialized service that only a handful of people requested.
The point of technology in business is to make life easier for you and your staff. To that end, technology has brought about several ways for businesses, large and small, to improve themselves in some straightforward ways.
First, you need to make sure you’ve taken advantage of as much free online marketing as you can. A good place to start is signing up for online directories, like Yelp, Google My Business, and so on. Beyond that are industry-specific directories and organizations you may wish to join.
Small businesses, especially those just starting out, should also begin to focus their digital efforts in a mobile-first way. Mobile technology isn’t going away, and small businesses that start to cater to that audience now will still see an advantage over their peers over the next few years. The newest development in mobile is the Progressive Web App, a solution that allows small businesses to offer native app functionality without needing to develop an iOS and Android app, respectively.
Working on your image has two parts. There’s your business’s image or brand and then you there’s your image or brand. Both of these are important. The smaller your organization, the more your own personal image matters.
Are you making it apparent to your customers what’s unique about your business? In the same way, you need to identify your strengths as an entrepreneur and assets to your business. Why? Because even if your company hasn’t had a lot of success yet, you can springboard off some of your own, related past achievements.
Above all, remember that your “brand” is what your customers think of when they think of your company. It’s your whole image in their minds, not a website, not a logo, not a USP or a single product. For that image to be successful, it needs to be strong, memorable, and distinct. If you can match all of those criteria, your customers are much more likely to be loyal followers of your brand.
The easiest thing you can do to improve your brand is to make sure it’s the same across all platforms. In other words, whatever image you project should be the same whether the prospect first encounters your brand through Pinterest, your homepage, or a directory. Your image must be cohesive.
To achieve that cohesiveness across all content and platforms, you’ll need two pieces of information. One is your buyer persona; the other is your business’s mission or value statement. These two documents will help you and anyone in charge of publishing something related to your brand to know how to go about it. The longer this image stays consistent, the clearer your branding will be in the minds of your customers.
A business that makes just two or three major changes a year is inflexible and likely to miss the mark for its customers, potentially wasting resources on an approach that doesn’t improve their situation at all. On the other hand, your business, and any other business that makes small changes frequently, is flexible. They can adapt to changes in technology, the market, and what their customers want. This will give businesses like yours a steady advantage.
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