There are a lot of factors involved in the running of a successful business. In a “normal” year, small business success can be threatened by a wide spectrum of obstacles. But the combination of a global pandemic and resultant economic downturn created far more obstacles than we’re used to.
Still, there are reasons to look out for a brighter future.
Here are 12 tips to ensure that your small business thrives in the second half of 2021.
#1: Rank your customers
You may know your best customers by name, especially if you are a small business with few customers, or sell mainly to businesses rather than the general public. If you can, rank these customers on one criterion, for example ‘who spends the most’, and then create a contact list for reorders.
You can also find out if there are any particular products your customers tend to purchase more than others, then build products related to those that your customer may be interested in buying too. Using accounting software makes it far easier to sort all your customers and their purchases.
#2: Support your brand advocates
Happy, loyal customers will always refer you to their friends. They will post about you on social media, which is free advertising, and people tend to trust their friends’ opinions far more than they do a company’s marketing efforts.
If you have customers like these, make sure you comment on the reviews they leave for you on Google, Facebook, or other social channels. A small gesture like that will help solidify your future relationship even further.
Offering a referral incentive is another good way to show appreciation to your loyal customers. A good example is if your customer refers a friend to your business, they will both get a discount on their next purchase.
#3: Create a culture of agility
If there’s anything 2020 has taught us, it’s to be prepared for any eventuality. This means rolling with all the punches. While many large organisations adopted a work-from-home policy, some businesses require physical labour or on-site staff.
Prepare for worst-case scenarios, revisit your business plan, and have a “what if” forecast, where all scenarios are accounted for in your cash flow.
Agility also means adopting practices that make your business more efficient. Tools like Robotic Process Automation (RPA) can free up management from routine, time-consuming tasks. Evaluate which of your processes can be automated and invest in that, if possible. It is something that will serve you long after the pandemic ends.
#4: Embrace targeted social media advertising
Facebook advertising offers look-alike audience targeting. Using your existing customer database, Facebook finds people who match the profile of your existing customers. You can then create ads that are targeted at this look-alike audience.
As another plus, Facebook ads are seamlessly converted to Instagram ads within the Facebook Ads Manager. When used correctly, Instagram can be a huge platform to grow and sell.
Targeting is the number-one benefit of using social media, because when you are setting up your ads, you can request criteria such as education, financial status, ethnic affinity, location, and life events.
You may get fewer people seeing your ad when you narrow your criteria, but lower numbers are outweighed by the benefits of reaching more of the type of people who are looking for your kind of business.
Make sure you set up tracking pixels for retargeting ads. These ads will show your products to those who have already visited your website, making it a seamless way to remarket your business to your audience.
Don’t have the funds to advertise on social? Running a giveaway contest is an easy way to increase your engagement and followers for a relatively low cost.
#5: Serve diverse markets
If your usual market is under pressure, are you able to try other markets? For example, you might find success in the next town or by changing your marketing focus. If your market is too broad (for example, people living within a one-hour drive), it may be better to narrow it to “female accountants who own townhouses in the city centre”. You may even discover a new market.
#6: Automate time-consuming business processes
If you’re struggling to keep up with paper receipts each month, it’s time to get a receipt app. It will lighten your load when it comes to reconciling expenses, because the app automates the process for you.
Another added benefit is the reduction of human error. When you can simply scan receipts the moment you receive them, you no longer have to worry about losing them or making mistakes when you input them into your accounting system.
#7: Use your accountant for financial confidentiality and support
Maintain confidentiality as you seek financing solutions and lean on your trusted accountant. You may not want to affect the performance, confidence or morale of your employees, customers, and suppliers by having them know that your business needs a cash injection.
Accountants have been on the financial frontlines of getting small businesses through the pandemic. As more upcoming legislation can affect the options of riding out the end of the pandemic, small businesses should have their accountants on speed dial as they can make headway potentially confusing applications and seemingly never-ending updates to legislative stipulations.
#8: Encourage subscription-paid services
Can you run your business on a subscription basis? If you can, set it up and offer your customers an incentive to sign up.
Subscription services or goods make it easier for both the customer and for you. For the customer, it is a pain-free way to get their goods on a regular cycle, without having to waste time with payment processes. For you, it can mean a consistent, regular cash flow.
By providing your customers with a variety of payment options, your small business will remain competitive and attractive to clients.
#9: Get feedback
Ask around and don’t be afraid to get honest feedback on where others think your business could do better. Often employees are instinctively aware of issues (and solutions) in the business, while those with an outside perspective can share ideas that you may not have thought of previously.
#10: Outdo your competition
It’s much easier to be competitive if you solve a customer’s problem better than the competition. Focus on the problems you solve, not the product you sell. If you were selling electric drills, it’s not the drill you are selling – it’s the hole.
2021 is a year of rebuilding. Ask yourself how that affects your customers. How can your business help them better in these new ways of doing business? If you can offer more value than your competitors, you’ll thrive.
#11: Offer more, don’t charge less
Lowering your price in order to compete is a losing proposition – especially against your larger competition who have deeper pockets. Instead, beat them using superior service, product mix, product knowledge, or post-sale support.
#12: Take sound advice
There are smart people out there ready to support you. Be open to listening to others and accepting their advice.
Recommended Next Read
Planning for the future using cash flow forecasting