A few years ago, the Bank of America did a survey which told them that small business owners find their SME owner tasks to be the most stressful thing in their lives. They said that running a small business is three times more stressful than raising children and twice as stressful as maintaining a relationship with their partner.
When you consider everything that goes into running a small business, this should come as no surprise. There are just too many factors that can sink your business before you even realize something wrong is happening.
It soon becomes quite obvious that you need to do everything in your power to safeguard your small business from failure.
But, how do you do this, exactly?
Surround yourself with the Right People (and Keep them)
It may sound a bit idealistic to some, but it is a simple fact that your business can only be as good as your employees. No matter how you cut it, your people will be responsible for the biggest portion of your success and you will do well to surround yourself with the best people you can find.
When you hire the right people, you can count on them to provide the most responsible approach to work, maximum productivity and an endless stream of ideas on how to improve your business.
Unfortunately for many SME owners, retaining employees has become one of the most difficult tasks when running a business. Employee loyalties are waning, the gig economy is taking a hold, and it is safe to say that very few people know how to keep their best employees.
Treat them well, provide them with benefits and allow them to advance their careers and improve their skills. This is the best place to start.
The majority of small businesses use some sort of software in their day-to-day operations, but it is safe to say that business software is generally underutilized among SMEs. This is especially true since the proliferation of Software-as-a-Service solutions.
Namely, with these SaaS solutions, small companies can now get access to software that used to be unattainable for them due to exorbitant prices. This new way of procuring software has made such software far more affordable and it enables SMEs to, for example, use business analytics software that used to be reserved only for the largest companies.
There are innumerable ways in which the smart use of software will safeguard an SME from failure. It will provide a much more fact-based decision-making process, it will streamline many operations and it will increase productivity manifold.
Don’t Neglect Cybersecurity
There used to be a time when small companies didn’t have to worry about cybersecurity as they were not attractive targets. However, as even the tiniest companies started operating with sensitive customer data and storing it, they also started becoming more and more alluring to attackers. This is probably best seen in the rise of ransomware, which is a very cost-effective way of making a living and it pays to attack small businesses too.
As an SME owner, you need to make sure that you pay attention to cybersecurity. This will entail installing all of the latest cybersecurity measures, especially if your customers/clients leave sensitive personal information with you. You will also need to educate and train your employees, as well as promote a culture of cybersecurity. It will also be a good idea to update your cybersecurity policies and to make sure your third-party vendors are secure.
The reason why you will want to go through all this trouble is that data breaches can be fantastically expensive, especially when you factor in the recovery period during which your company might have to be shut down. Keep in mind, these recovery periods can last up to a few weeks or even months. Can you afford to shut down for that long?
We didn’t think so.
Be Careful with Your Money
Perhaps the easiest and the fastest way for your small business to fail is to lose track of your money. Perhaps your revenue is being eaten up by something like shipping and it takes you a few months to notice. Perhaps you have been paying your taxes the wrong way and you soon find out you owe a substantial amount in back taxes. Perhaps you decide to buy out a competitor and take out a really bad loan. Perhaps your employee turnover or legal fees are making you haemorrhage money.
There are innumerable ways in which an SME owner can lose track of where their money is going and how liquid their company is. When something like this happens, you start getting into damage control mode and, for a very long time, you are always a few steps behind, sticking your fingers in a leaking ditch, trying to stave off or prevent a catastrophe.
Always make sure you have your finances in order and if you are not sure you can do it yourself, hire an accountancy agency to handle this for you. You may not have planned to do so, but you simply need to.
Rethink Your Marketing
It is difficult for a small business to become relevant and stay competitive. The competition is almost always very strong and there are never enough customers to go around. One traditional way to go about this is to do some marketing, but unfortunately, many SME owners do their marketing the wrong way.
There are two main schools of thought and action when bad marketing is in question.
The first one is the traditionalist school of bad marketing where nothing that was invented after 1950 is a good idea. The proponents of it refuse to acknowledge customers that might find them online and they sink huge amounts of money in local media, even if it does nothing for them.
The second school of bad marketing is the ‘join the hype’ one, where every marketing buzzword gets them excited and throwing money at it. They rarely track actual results and spend time and money on (mostly online) tactics that need far more expertise and context to work.
Marketing is about making money. It is about finding ways to attract new customers that will spend money with you. It doesn’t matter if you use VR marketing or if you paint the side of a cow.
If it works, it can help you avoid failure that is inevitable once the customers run out.
John is one of the directors at RE:SURE a remote CCTV and security company with bases in Dublin and Belfast. The company provide live monitoring and live audio for CCTV security systems.