Image by iha31
Here’s a question from a reader:
Q: Despite my hard work and advertising, my small company has not been faring well financially. Help!
A: A company performs well by employing strong marketing programs as well as maintaining efficiencies in the control of costs, performance and quality. So, there could be a myriad of reasons for your demise, including competition, lack of proper focus, and poor employee performance.
Not to oversimplify, but here are four areas that warrant your attention:
— Expenses
— Too much focus on revenue
— For talent, strategize to recruit mature workers
— Big picture planning
Expenses. You don’t indicate how many workers you employ, but the first area on which to focus is your ability stay in business.
So focus on expenses without looking desperate.
The key is to cut where you can without appearing to do so, and to determine your break-even point.
Until you have reason to be confident, fake it until you make it. Act with conviction and customers and vendors will remain confident in you.
Sometimes hiring or outsourcing work to independent contractors are the way to go because they’re more experienced and require less supervision, and they do not require health insurance or other benefits.
For many job descriptions, interns can be beneficial. But if you don’t pay interns, make certain you adhere to applicable laws and regulations. You don’t want to be accused of exploiting them for profit gain.
And, there is wealth of software that helps small businesses to function.
As for your location, determine where you can economize. Can you move your business into your home or into an executive suite, which can be rented by the day or month? You’ll get secretarial help, such as a receptionist or telephone answering services and photo-copying.
Many professional firms sub-lease or rent out their extra space. Conversely, perhaps you could rent out your extra space.
…four areas that warrant your attention:
— Expenses
— Too much focus on revenue
— For talent, strategize to recruit mature workers
— Big picture planning
What about your loans? Can you consolidate your loans for vehicles or equipment to lower your payments?
Implement the step-by-step solutions for a company turnaround.
Too much focus on revenue. Sometimes entrepreneurs find themselves focusing on how to make money when that’s really the desired result, but management behavior doesn’t match the goal of being profitable. They reactively cut prices to generate volume without considering other solutions.
And cutting employees without enough focus on other sales and customer service are often premature.
You need to find customers who want your products and services. Give them reasons to keep coming back. Give them the right incentives to refer other customers to you. And don’t forget to make your business fun.
Companies succeed when customers come first by creating a happy buying environment. This accomplished when you start with the point of customer contact. You must have competence in telephone answering – a skilled receptionist, who is great in business etiquette and in solving of problems.
Make certain customers get prompt responses and don’t screen your calls. How many times a day does your receptionist say these words: “Can I say who is calling?” Customers don’t like to be screened out.
Consider the elements needed for your customers’ satisfaction. Low prices only represent a small percentage of their satisfaction. Customers appreciate fast, responsive and knowledgeable customer service.
My research shows customers will start buying from your competitors when they feel taken for granted by you or your employees. That’s true in 70 percent of cases when customers buy elsewhere.
Only about 18 percent of consumers are so price-conscious they only buy products or services at the cheapest price.
So, target the customers who appreciate value in other ways: The diligent work of your staff, your strong business image in the community, convenience, and a reasonable price.
Here are the 10 best marketing tips for growth even on a tight budget.
Never stop marketing. Invest 20 percent of your time and resources every day. Give adequate thought on how much money to invest. For more on marketing, see the secrets to success in a weak economy — expand marketing.
If you’re frustrated in looking for clients, soften your approach.
If you take such precautions, you will distinguish yourself from the competition.
Recruit mature workers. They are a source for experience and stability — in human resources, slow motion gets you there faster. Employer turnover and poor recruitment are detrimental to controlling costs. Research from employment services company Manpower Inc. in 2007 indicated many companies don’t have a good understanding of employee recruitment.
In particular, it seems that 78 percent aren’t concerned about the graying population and its impact on the retaining of good workers. Some 28 percent don’t have a strategy for keeping their workers past the age of retirement and 18 percent aren’t planning to recruit such mature employees.
The temporary help firm suggests several best-practices in hiring, such as training programs to increase skills, flexible scheduling or job-sharing, and new job descriptions to accommodate candidates who can bring value to the company.
Big picture planning. Budget time on a regular basis for “blue-sky” planning. In other words, make the most of your free time. Even the most harried entrepreneurial manager can make time to brainstorm. Use the white space on your calendar to connect the dots between your personal and business goals.
Hint: Think 1930s for business success. Consumer attitudes are changing.
Consider whether you need to make fundamental changes, alter your business structure, fine-tune components, or to inspire confidence in customers and employees.
Thinking outside the box is a bit of a tired, over-used phrase, but it’s still apropos. Consider the principle of “contrary action.” Take contrary action in all that you do. In this way, you’ll learn to keep an open mind. Then, focus on areas in which you’re passionate.
Become known as a leader in your industry. But don’t make the mistake of failing to learn principles from others outside your profession. Read biographies of successful people and learn the reasons why they solve problems and create opportunities for growth. And, network with professionals outside your particular industry.
Study your competitors. How do they differ from you? Think like a customer and take out a pen and paper. Determine where you fall short and what you need to do for improvement.
When facing a stressful problem, remember this one basic principle: There’s at least one event in your past that has prepared you for this challenge.
From the Coach’s Corner, by the way don’t forget about developing an exit strategy now.
“Profit in business comes from repeat customers, customers that boast about your project or service, and that bring friends with them.”
-W. Edwards Deming
__________
