Management Tips for Small Businesses

As an entrepreneur, do you get a little confused when people start interviewing you on “business management”? Not surprising, since it’s probably based on the belief that the word “management” is more suited to big business and multinational conglomerates. From one perspective that might be true, but from the perspective that you want your business to grow, thrive and be successful, then it is the wrong approach.

Efficient business management is the foundation of a successful business. In simpler terms, small business management is a mix of many things: that is, the juggling of many hats like advertising, marketing, administration, HR and sales. If any one of these elements if managed incorrectly or with a lazy approach, then it can, in fact, make or break a small business. It is therefore extremely important to draft and execute governing policies—yes, even if you are the only individual—very carefully.

Policies to Implement and Manage

Running a small business does or one does not release you from acting responsibly to your stakeholders. The following is a list of policies that will support your growing business.

• Return Policy: Do you sell a good or service? Then you need to address the very real fact that someone may not like it after she has purchased it. This policy outlines how to deal with such situation.
• Bad Check Policy: Do you accept checks as a form of payment? Then you definitely need to have this policy in place. It will provide you the backbone to approach and resolve a situation if someone decides not to play nicely with his form of payment.
• Privacy Policy: Do you have any exposure on the World Wide Web? Do you communicate using e-mail? Then you need to ensure the privacy of not only your customer’s information but also your own. A privacy statement at the bottom on your emails, no matter how unimportant the email content may seem at the time, is necessary. After all, there may just be a need in the future to fall back on the privacy statement.
• Contracts: Do you outsource any of your work to independent contractors or have an ongoing relationship with a vendor? Then you need to consider having a contract which outlines the relationship and expectations of both parties set up. This is not only for your protection, but also for the other individual’s best interests. At minimum, have a procedure outlined as to how to enter into agreements, dissolve agreements and amend agreements. Having this type of procedure outlined for yourself will allow you to remain consistent in your business dealings. This also pertains to employees; that is, if you are an organization that has actual employees, then you need to make sure you are compliant with state and federal laws but also take into consideration if your city of business has employment laws. Having Policies and Procedures laid out prior to hiring anyone will allow for the process to be that much smoother.
• Payment: Do you pay your creditors timely or carry balance for clients? If so, then you need to clearly outline and state the payment terms so both parties are clear on what is expected of the financial exchange between the two of you. Again, this type of procedures outline will allow you to manage your budget and your communications effectively and efficiently.

These are just a few of the policies and procedures you need to consider when starting your own business. Establishing policies, even in rough draft form, will allow you to confidently grow your business to the next level and beyond. The concept of having policies and procedures in place for you business provides the means for you to review and refine them as you experience different circumstances. Do not be afraid to change or update a policy or procedure you’ve already implemented: this is called “growing.” And when we grow, we sometimes need to expand our wardrobe to include new thoughts and perspectives.

Budget Management

Another area of concern where most newly owned businesses can fall short is in budgeting. Even though as a private organization you are not responsible for reporting financial information to overseers or stockholders, you do need to have a finger on the pulse of your business from a financial perspective. What goes out must be equal to or less than what comes in. This might be simple, but with the readily available credit cards that are issued, getting yourself into debt can be very easy—almost too easy.

Marketing Budget

Have an idea of what marketing strategy you are going to implementing, and then get a rough cost on all the different opportunities to run ads, sponsor events, etc., before committing to any. When you have an idea, make sure you know out of all the opportunities which is most in alignment with your own business and potential clients. In order to pull together a marketing budget, you first need to be able to answer the following questions.

1. Who is my perfect client?
2. What is it they want from me?
3. Where do they live, work, play?
4. How do they spend their disposable income?
5. When do they need my service or product?
6. Why would they partner with me?

The above six questions will give you a very rough draft of your market demographic. You can search and find a lot of information on the website with regard to marketing strategies. One great blog to read regarding Small Business Public Relations and Marketing is the one by Sheri Fisher. Her most recent blog on knowing your audience is very helpful for this. You can read it here.

Sales Management

When you are a small business, sales force management is extremely important. Your sales team, which is normally just you in the beginning, must clearly understand the psyche of the target audience/customers. The endeavor of the sales team is not only for the sake of closing deals and ensuring revenue collection, but also for creating customer loyalty. One of the parameters for the success of a small business’s sales force is the number of repeat sales it is able to generate. After all, a new business’s stability comes from its loyal customers; that is, people who convinced that your product/service is worth investing into again and again.

It is important to remember that no business is born big. They all start small, but it is through efficient business management, proper policy and procedure creation, and fiscal responsibility that small businesses are able to grow into big multinationals. There are many resources available to expand your knowledge around proper business management, so embrace your ability to find these resources—your business and your pocketbook will thank you for it.

Until next time, embrace your inner wisdom.

Namaste,
Karen