8 Skills You Need for Small Business SuccessSee also: Management Skills
When you run a small business, you need to have plenty of drive, determination and passion in reserve.
Without it, you are likely to be one of the 60% of small businesses in Australia that fail within the first three years. However, just having these personal attributes is not enough to ensure the success of your business. You also need a raft of capabilities.
Here are eight skills you need for small business success. Channel these talents and you will go a long way towards establishing your venture for the long haul.
1. Strategic Planning
There is no truer saying in business than ‘if you fail to plan, you should plan to fail’. A process in which the goals and strategy of your company are formulated, it is impossible to overstate how important the skill of strategic planning is for any small business.
Without it, a business is much harder to run. It also makes the process of allocating human and capital resources, as well as generally making rational, considered decisions, a lot more difficult.
The most successful small business owners draw upon their strategic planning skills to roadmap the future performance pathway of their company. They generally do this through a 3-to-5-year business plan.
2. Financial Management and Cash Flow
For any business, the need to efficiently and effectively manage its finances and cash flow is critically important. Failure to do so puts it well and truly on the back foot. All businesses need to predict their sales revenue and cash flow.
Therefore, having excellent competency in financial management will not only assist you to run a profitable venture. It will also help safeguard your investment and livelihood.
A crucial element for doing this is cash flow. Arguably the most pertinent concern of all owner-operated or small businesses, it relates to the movement of finances within your business. In other words, how much money you make through sales in any given week against how much you have to pay in terms of expenditure.
Cashflow is both the main indicator of the health of a business as well as its essential lifeblood. If you don’t have a good handle on it, then you could end up spending more money than you make, which soon becomes unsustainable.
One of the best ways to manage your cash flow is to ensure all payments you receive are made with a Smartpay EFTPOS machine for small business. This EFTPOS machine can integrate with other POS systems and help effectively track all transactions coming into your business.
In turn, this makes it easier to track how much capital you have and enables you to pay your business expenses like rent, stock purchase and marketing costs in a more manageable way.
3. Sales and Marketing Skills
Henry Ford famously championed that all businesses need innovative marketing to survive.
At some point, especially just after you have launched it, you will need to be able to promote your products or services in a way that entices customers to spend money on it. There are several ways you can do this. Including social media, advertising, public relations, sales promotions, direct marketing and via your website.
To do this productively, it helps to have very good sales and marketing skills. This will enable you to decide what products to sell and price them accordingly. It will also help you determine who your customers are, the relative strengths and weaknesses of your competition and to develop a promotional strategy that creates ongoing and profitable streams of revenue.
Having good communication skills is a crucial component of a prosperous business.
Doing so will help you develop strong working relationships with your customers, staff, suppliers and employees, which can only contribute to ongoing success.
The better your written and oral communication skills, the more clearly you can convey your strategic vision for how you want it to run and grow. It will also help you to resolve any conflict that may arise more easily and potentially damage the smoothness of how your business operates.
To complement good communication skills, it is also important to be adept at negotiation as well.
You need to be able to negotiate with customers, staff and suppliers every day during normal business activities. Your ability to do so successfully should directly improve your bottom line.
The key to negotiating in your favour is to come to a point where you establish a win-win scenario that suits you and the other party.
You might not be able to do this immediately, but during back-and-forth communications, the savviest small business owners always work towards this outcome.
Should you employ staff, then you will need to demonstrate good leadership skills to keep them motivated, engaged and productive.Essentially leadership in business is the process by which you achieve your strategic and operational goals through people. The best way to do this is by leading by example, ensuring your customers are satisfied, enabling your staff to feel valued and empowered and developing good relationships with suppliers and investors.
Integrity is a key component of this, as is your ability to delegate and resolve any conflict that may arise.
7. Time and Project Management
Running a small business is not easy, and it is definitely not a 9-to-5 role either.
For this reason, it is important to have good project and time management skills as you will find yourself having to juggle multiple projects and people. It could include everything from serving customers and ordering new stock to running promotional activities and identifying new ways to streamline your operation.
As a skill, a lot of time and project management is the common-sense related approach that lets you manage your time in the most productive and effective ways possible.
The better your adroitness with these skills, the more value and success you can deliver to your business.
8. Problem Solving and Analytics
It doesn’t matter how well you plan. At some point during its daily operation you are going to need to make some tough yet sound decisions – occasionally under real pressure.
As the modern workplace is constantly evolving through more advanced and complex technology, the need for good problem solving skills becomes more pressing. It may involve assessing your business’s current operational status, ascertaining what level you want your business to get to and outlining areas within the daily running of your company that can be streamlined or enhanced.
The key to doing this successfully is to collate, evaluate and understand processes, trends and key data that will enable you to work out the best solution for your business.
When running a small business, you really do need to be a jack of all trades.
To make it a success though, you need to be able to draw upon the skills outlined above. If you possess them, you should be able to handle anything that gets thrown your way during the daily running of your operation.
If you don’t have these skills, you need to be honest enough with yourself to recognise this since this will enable you to find the right tools to help you improve your competency in them.