Thank you small businesses! With your help our economy is recovering, and most people I talk to are telling me their businesses are improving. One of the downsides for small businesses related to the slumping economy was a mass amount of layoff that left many very smart people without a job. Those people decided to go start their own small business. (This includes me?) With the larger amount of competitors out there, we cannot just rely on our ability to be nimble in changing time and our superior customer service as compared to the large companies; we must do more to set ourselves apart. I have compiled a short list of a few ideas I feel can help. I am also looking forward to reading all your ideas in the comments section.
1. Become a niche market – Many of our small businesses are sometimes cookie-cutters of other businesses or even our direct competitors. But what we forget is that we also have certain passions in our life. For example I am a passionate participant in the world of volleyball. I have done everything from coaching to managing to playing at all levels of the game. So for me, if I was a screen printer, I would certainly focus my niche on volleyball. I know their needs, and I would cater to that. I certainly would not turn other business away, but where is a better place to start a small business than dealing with people you might already know around something you love.
2. Don’t compete on price alone – Most failed businesses that I have seen in my day tend to be the ones that their only claim to fame is that they are the lowest price. The old saying “You get what you pay for.” is around for a reason, and people might go elsewhere for one or two jobs based on price but ultimately will come back if you provide something extra, like great customer service, prompt delivery, etc. Don’t be afraid to compete on price if you can make money doing it, but at the same time, give the customer some value outside of being the cheapest. Remember even in a down economy people are willing to pay a higher price for superior products and service. Think Starbucks – $5 for a cup of coffee that you could get for $1 at the local quickie mart!
3. Open your horizons – Okay, so this might seem to contradict point #1, but really it doesn’t. Don’t be afraid to jump to new markets. Most times, new customers are right in front of us, but we are so focused that we forget that. Let’s go back to me as the example. Let’s say I’m at the volleyball gym delivering some shirts, but in the same gym there is a youth basketball tournament going on. Why not approach them and see if you can help them. Then on your way home, you stop to get your car washed (because you live in AZ and the monsoons do nothing but make your car dirty). Why not quickly ask the manager at the car wash if you can compete for their apparel needs. Always have good professional business cards with you for these opportunities. (Bonus Tip: As a screener, make sure you print some nice tees with your logo and contact info on them that you can wear as often as possible. Remember a T-Shirt is actually a walking billboard!)
4. Education – As a sales/marketing person (which should be your main function unless you have someone you can trust doing that), your main goal should be educating your customers. Become the expert and make sure you know exactly what your competition is doing. More often than not you lose jobs not because of a better sales job by the competition, but because the customer didn’t fully understand what they were getting into. Maybe the guy up the street is selling shirts for $3 each but doesn’t mention there are setup charges, screen charges, multiple color charges, etc. During the quoting process, make sure you ask the questions of the customers as if they are looking elsewhere and what the keys are to their selection process. It is not inappropriate to ask, and I think it shows your customer you care about winning their business.
5. Make Money! – This is most likely the most important part of being a successful small business, which seems a little obvious, but trust me I have seen firsthand what happens when you don’t have a good handle on if you are making money. You must have your goal to make money; otherwise you have a hobby, not a business. You have to know what your costs are, and you have to price your products accordingly. This means you must spend the time to make sure you are tracking your production, know exactly what your costs are (i.e., did you factor in shipping costs to you, the cost of accepting credit cards from customers, how much you pay in interest on your credit cards, etc.). Then you must know how much your time is worth. As a small business owner (i.e. entrepreneur), you have given yourself the right to work 24 hours a day, but that has to be worth something to you. So ask yourself, do you know how much you are really making?
Hopefully those small tips give you something to build on, and mainly my goal was to get you thinking marketing. I can’t wait to read your comments and ideas.