It takes a special breed of person to run a small business successfully. You have to be passionate about what you do to succeed, because the work is so hard and the competition — including that from major corporations with deep pockets and seemingly unlimited resources — is steep. Yet more than 28 million small businesses are making their way in America right now, and small businesses outnumber large corporations by more than 1,000 to one. The entrepreneurs and established small business owners who run these individual small companies are the backbone of American business.
You should be proud to run or own a small business. Unfortunately, your status as heroic pursuer of the American dream will not exempt you from any of the tough fiscal realities that make small business ownership such a tough calling in the first place. If you’re going to keep your dream alive, grow your company, and thrive in the world of business, then you’re going to have to learn how to keep your business lean and your profits high.
There’s no magic formula to doing this, but there are some basic principles and a few tricks of the trade. Here are a few of those concepts to help you run a better business.
Use software to lighten your workload
You only have so many hours in the day. You only have so much money in your budget for payroll. So how can you handle all of the work that you need to get done?
One thing you should consider is taking a page out of the big corporate competition’s book. Leverage the lower costs of automated solutions. Thanks to the rise of software solutions and tech-based outsourcing services, small businesses now have access to automated and computer-based solutions that were once only available to larger operations.
Of course, software solutions can be pricey themselves, so be sure to do your research and read reviews on trusted sites such as TrustRadius. Pick the software solution that is most appropriate to your needs, or contract with a software firm to customize another product or create a new program for you. It’s worth paying for the right fit!
Hire very, very carefully
Small businesses are huge drivers of job creation in the United States. They produce a disproportionate number of jobs, and that’s a good thing — for the economy. Of course, as one of the people at the top of a small business, you know that hiring is not cheap for a company.
Hiring is expensive, and firing and rehiring is more expensive still. Keeping employees on the payroll is pricey. So is firing them because you have too many employees, and so is paying them overtime because you have too few. One of the most important things you can focus on as you seek to make your small business more efficient is the cost of your employees.
Make careful plans and run through the numbers multiple times before making any payroll decisions. Consider outsourcing payroll and accounting services, and consider contracting with a consultant to help you make difficult decisions. Make absolutely sure that you’re hiring the right people, and keep them on for as long as you can — the more experienced and better-trained they become, the more you’ll be getting for your money.
Use outsourcing to direct your focus
When you’re running a small business, your focus should be on your core competency. You should be bringing your expertise (and that of your employees) to bear on the things that you do best — and you shouldn’t be focusing on things you’re not as qualified for.
Happily, you can use other professionals to direct your focus. Rely on outsourced solutions for non-core tasks, and free up more time for you and your employees to do what you do best. You’ll have to strike the proper balance, of course, but don’t assume that it’s cheaper to do everything in-house — that is frequently not the case, and even if it is, you may generate more value for your company in the long term by focusing on what you’re really here to do.