Think Big To Grow A Small Business: 4 Fiscal Factors to Success
Not too small. Not too big. Just right.
More than 29 million small businesses account for 99% of all companies in the U.S. and employ approximately 58 million people. “Small” is defined as between 1-499 employees, with companies employing fewer than 100 people having the largest share of small business employment.
Many small businesses grow from an idea that an owner is passionate about. They put that passion to work to create a happy and fulfilling career. However, starting and running a small business can bring just as many challenges as rewards.
The goal of a small business is to add value to people’s lives and, of course, to make money. Setting growth goals and strengthening financial savvy is essential for small business owners. Without goals, owners may find themselves stuck in the same place, not growing the business to its full potential, or possibly losing everything and shutting it all down.
Whether you are the owner of an existing business looking to move to the next level or just jumping on the entrepreneurial express, here are the 4 keys to small business success and growth …
1. Know Your Customer!
The first step is to research the market.
- Is there a market for what you are offering?
- Who is your ideal customer?
- What makes your business unique?
- Why would a customer select your business?
Market research provides a data-driven roadmap and direction for the business, helping to prioritize actions and make informed decisions.
Owners need to understand their target customers, their needs, and what competitors are offering. Conducting market research helps identify gaps in the market and helps position the business to meet those needs. Once the target market is identified, SMART goals can be developed.
SMART goals are:
- Specific
- Measurable
- Achievable
- Relevant
- Time-bound
For example, if you want to increase your revenue by 20% in the next six months, you can break that down into specific actions, such as increasing your marketing budget, launching a new product, or expanding your customer base.
2. Seek Smart Support
Small business owners may not have the same budget or workforce as larger companies. Owners need to be creative in finding solutions, including leveraging technology to automate processes and save time or outsourcing tasks to freelancers or contractors to reduce costs.
An efficient accounting system is essential. You don't have to go all-in and pay for a full-blown bookkeeping service or software, but having some sort of digital record will help keep track of everything that happens in the company. A clear financial record offers a quick-look reading of your company’s money situation.
3. Delegate the Weakest Links
Another challenge small business owners face is the temptation to do everything themselves. While it may be tempting to take on every task to save money, it can be detrimental to the business in the long run. Instead, owners should focus on their strengths and delegate tasks that are not their expertise to others. Seeking advice from other business owners or mentors can offer valuable insights and opportunities to learn from their experiences.
4. Keep the Cash Flowing
Cash flow is another critical aspect of growing a small business. Owners need to have enough cash to cover expenses, pay employees, and invest in growth opportunities. One way to manage cash flow is to create—and follow—a budget and monitor expenses regularly. Exploring financing options such as loans, grants, or investors to fund growth plans can provide capital to help take advantage of opportunity and move the business to the next level.
When small business owners consistently pay attention to these 4 fiscal factors, upsizing a company to its full potential adds up to more rewards and financial security.
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Photo by Greta Hoffman