Business people face many challenges to survive and succeed, but you can do a great deal to improve your chances of success without spending large sums of money. This guide offers six tips on how you can overcome the challenges of being in business and lift your business well above the average.
1. Develop competitive advantages
If you don't have some compelling reasons for people to do business with you rather than with other businesses, you cannot hope to survive long in business. It's therefore crucial that you develop as many competitive advantages as possible. The need to identify your point of difference is even more important if (like most businesses) your business offers similar products or services to your competitors. The more similar your business is to many others, the greater your need to develop competitive advantages.
The smarter you can be about developing and promoting your points of difference, the better placed you will be to compete and thrive.
2. Increase your credibility
Building credibility is all about risk reduction. To gain new customers or clients, you have to reduce the risk they might feel about doing business with you. Likely questions in their minds are:
- "Will I risk losing my money?"
- "Will I get good value for my investment?"
- "Will the product or service be of good quality and what about back-up and service?"
- "What happens if I'm not satisfied?"
Your task is to eliminate the risk they might feel in doing business with you by increasing your credibility. Here are some ideas:
Offer a guarantee
Show you stand behind your products or services by offering an unconditional, money-back guarantee prominently displayed on all your promotional material. If you offer quality goods and services, guarantees are a great way of building your credibility. Many businesses hesitate over guarantees, but most businesses that offer guarantees will tell you that only a very small percentage of people ever make claims. A personal guarantee signed by the owner of the business can be even more effective.
Collect customer feedback/testimonials
What other people say about your business carries more weight than your own claims. People feel less risk if they know that others have tried your products or services with pleasing results. One of the most effective ways of developing credibility is therefore to collect positive customer comments in a file and quote the best examples in your brochures, adverts and promotional material. Make sure to include a 'What Our Customers Say About Us' page on your website. If you can get testimonials from well-known people, so much the better.
Since many people shy away from any writing task, a tip here is to write the testimonial for them. Base it on what they said about your business, and then ask their permission to use the results. For example, you might email a customer as follows: 'Thank you for the very generous things you said yesterday about our product/service and your dealings with our business. Would you mind us quoting your comments in our next brochure/advert? As far as I recall, you said (quote the customer's words). Please edit this if it doesn't quite reflect what you said or felt, or if you wish to add anything else." Most people will accept your version of the testimonial (provided it is a reasonably accurate reflection of what they said), and give you permission to quote it.
Become the expert
Build credibility by becoming the expert in your field. For example, if you run a catering business, offer special cooking classes or write a cooking column for a local newspaper. If you set up as a financial advisor, run seminars on 'Investing for Retirement' or other financial topics.
If possible, publish short booklets on your industry that you can offer to people who are interested in doing business with you, or speak to local community groups such as Rotary, Lions and Zonta clubs.
Aim to establish yourself as the authority figure in your field, so that when people want certain products and services, they think of your business first. Aspire to be the first telephone call for newspaper or other media editors ringing for comments on what's happening in your industry.\
3. Provide a quality service standard
Whatever products or services your business sells, try to be the best. This will not only enhance your credibility, it will help you to retain customers and develop new business through referrals. Here are some tips:
Develop good systems
Work at developing efficient business systems that allow you to deliver quality products or services on time every time. Under promise customers and over deliver. For example, if you run a paint and panel shop, and you think a job will take five days to complete, promise delivery in seven days. The customer will be thrilled to get their car back early, and you have a safety buffer of two days if there are delays. Similarly, customers will be very impressed if you deliver a job or service for less than your estimate. If things don't turn out as planned, phone the customer as soon as possible and apologise for any inconvenience. Just these three simple business tactics and courtesies will put you well ahead of most businesses.
Train staff well
Every staff member is an ambassador for your business, so investing in training and effective communications with customers makes good sense. Make sure that staff offer friendly, knowledgeable service and they are smartly dressed if they deal with customers. Keep service standards high by mystery shopping your own business and by recognising staff who perform 'beyond the call of duty.'
Use the feedback loop
Actively seek customer feedback and use this feedback to fine-tune your business, or develop new processes, products or services that better suit your customers' needs. Once these new changes are in place, seek customer feedback again. Use this continuous feedback loop to evolve your business both to satisfy customers and to meet the changing marketplace. Make this an on-going process, since a static business can only end up going backwards.
Promote excellence through example
Set an example in your business of excellence in everything you do and in all your dealings with customers. Staff take their cue from their leader, so if they see that your standards are high, they are more likely to lift their own performance. Being the first to arrive and the last to leave the business may seem old-fashioned, but it still conveys a positive message.
4. Develop strategic alliances
One of the biggest challenges faced by small business owners is competing against larger business with more resources. One of the best ways of overcoming this challenge is to form strategic alliances or joint ventures with other businesses. Working with other businesses to achieve your goals is also an enjoyable way of decreasing the isolation of running a small business.
Strategic alliances can take many forms. For example, you might form a strategic alliance with other businesses in your industry to gain more purchasing power. Or you might form an alliance with similar businesses to share nation-wide advertising costs that you could not afford on your own.
Another example would be to form a strategic alliance with another business or several businesses so that you can offer a more complete range of products or services to your customers and become a 'one-stop shop.' The strategic alliance might also take the form of reciprocal website links whereby you promote the services of another business on your website in return for that business promoting your products.
Think about forming strategic alliances with your suppliers as well. If you use a well-known supplier, add the logo to your promotional material to build credibility. Ask the supplier to share signage and promotional costs, and see if you can benefit from their market research in return for you supplying customer feedback on the supplier's products to them.
In the end effective strategic alliances are all about thinking differently. Instead of viewing yourself as a small, isolated business, start thinking instead of mutually beneficial working relationships with other businesses that will enable you to overcome the handicap of smallness and compete more effectively in the marketplace.
5. Continually develop new products or services
Never rest on your laurels is a guiding principle for business life. No matter how excellent your products or services, they will go through the product/life that sees them reach a peak in the market and then decline. Depending on your business, this may take mere months, or many years.
The increasing pace of technological change means we all have to change. A business that is not investing in the research and development for the next generation of products and services is heading for decline. It is particularly hard to think ahead if you're enjoying great current success in your business, but markets can change quite quickly and the unwary do suffer.
Watch market changes
Keep alert through market research and through increasing your awareness of external factors that could impact on your business. Good business networking (such as belonging to your local Chamber of Commerce, Employers and Manufacturers Association or industry group) will help you combat the dangers of isolation.
6. Have a strategic vision
Studies show that most small businesses do not even have a written business plan (you can easily verify this by asking your business colleagues if they have one). This fact is startling, but it shows that most small business people 'fly by the seat of their pants.' It is no surprise that the failure rate for new businesses is so high. Aimless businesses end up going nowhere.
Completing a business plan for your business will lift you well above the average and help you to develop a strategic vision for your business. Simply reacting to events as they occur is no substitute for forward planning.
Working towards goals
You cannot hope to inspire your staff (let alone yourself) if you don't quite know where you're heading. A good business plan provides you with the necessary directions to your targets. Nearly all successful businesses are driven by clear goals and targets that give purpose and direction to the whole team.
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