It is easy for small business owners to get stuck with questionable business practices, especially when they are in the early stages of development. Sometimes in the zeal to achieve profitability and success, the employees and management take shortcuts. Here are ten frequently overlooked secrets about small business management that will help your company achieve success:
1. Cheaper priced items will NOT attract more customers. Racing your competitors to the bottom on pricing is a hard path to follow. Instead of slashing prices to attract sales, create value for your customers. People will pay a higher price if they understand the value they are receiving.
2. Be careful with your tax write-offs. Some of the benefits of ownership are the small business tax deductions that you can enjoy. But, don't get carried away by writing off things that aren't qualified as business expenses. Work closely with your accountant to identify legitimate business write-offs.
3. Tax season is NOT the only time to look at profit and loss statements. Some business owners run their company with a blind eye throughout most of the year, and then they are shocked by the numbers they see at tax time. Instead of waiting until tax season to review the reports, make it a priority to look at tax numbers every month.
4. Every business needs a website. Even if you only make in-store sales, it is still necessary to develop a strong presence online. A website can drive potential customers to your store because they can locate your business online and then visit your retail location.
5. Don't chase sales at the expense of monthly cash flow. Yes, it is important to look for ways to boost sales. But, you can quickly eat away at your profits if you aren't managing costs. Instead of focusing only on sales, it is also important to control your spending and review monthly your cash flow management.
6. Set a reasonable timeline for profitability. Even if you are an expert in your industry, it takes time to build a profitable business. Don't be let-down if it takes a few years before you see the higher profit numbers that you are aiming for.
7. Invest in marketing. Every business owner has dreams about customers flocking through the door each day. But, the truth is that building a business doesn't necessarily mean that your sales will be booming. Business success is dependent on a good marketing campaign and connecting with your customers.
8. Develop a business plan. Even if you aren't seeking a small business loan you should still put in the effort to create a business plan. This plan will be the guiding resource to help you reach your goals later on.
9. Identify your profitable customers. The goal is to make sure that you are serving your clients, but there are some people who just can't be pleased. Don't get caught up with the one disgruntled customer… do the best you can, but know that some people are just unhappy.
10. Don't take on unnecessary business debt. Just because you are running a business, doesn't mean that you need to accrue business debt. When you are working closely with an accountant and managing the cash flow of your company, it is possible to minimize debt and maximize profits at the same time.