Tuesday, October 18, 2016

New Product Development in Small Business

In this world where everything is changing, products also need change to survive and gain more market share. Innovation / change or  new product development is necessary to stay ahead of your competitors. Customers expect and demand something different time to time. A good change gives new life to the product.

Unlike, big organizations small businesses have limited resources so when a small business opts for new product development then the owner has to share the major work burden.

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New product development could be a totally new product or could be a change in packaging, size, design, material or in  product features etc. Some of the advantages of new  product development are:

            * keeps your clientele intact.
            *  helps you stay ahead of your competitors.
            *  helps you increase your market share.
            *  prolongs your product's life.
            * improves quality of your product.
            * mostly it reduces your cost.
            * eventually leads you to more profitability.

Following are the steps needed to be taken for New Product Development:

Understanding when there is a need for product development: An unwanted change / innovation is not helpful for anyone. Timing is crucial. If you are late then your competitors may take advantage and capture bigger market share by launching the new product before you do.

Generating ideas how to fulfill the need: Once you know that change is necessary and market is ready to welcome it then think how will you deliver it. You can generate ideas by brain storming, talking to experts, research through internet, by visiting libraries, listening to your office concerned staff etc.

Do a detailed research on your idea: Once you have finalized your idea then do a detailed research on it. Find out how much time & money will it take to realize your dream. What will be the market size, profitability etc. Also, how is it going to benefit your customer.

Testing your idea: Once you are fully comfortable with your idea then produce the new product on a small scale for test marketing. Show the new product to your marketing staff, retailers and to the end users to get their feedback. If necessary make amendments accordingly.

Making a comprehensive launching plan: After you receive a positive outcome from test marketing make a comprehensive launching plan. Workout every detail i.e. funds needed, manpower requirement, ad campaign etc. Then set the deadline and give your best shot.

Post launching review: After the launch be in constant touch with your marketing staff, customers and other stakeholders. Give importance to the feedback you receive from them and make changes and improvements accordingly. Here, understanding customer needs and delivering according to their expectations is the key to success.

I hope you found the above helpful. please free to comment.


Wednesday, October 12, 2016

Market Intelligence for Small Business

Things around us are changing rapidly. In order to survive and grow we need to embrace the change timely. People who are slow to change or do not change lag behind others. Same goes for businesses.

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Businesses need market intelligence to understand what is changing and how it is going to make a difference for them. Also, this information helps them in decision making and to set & adjust their long term & short term goals. It is also required for market development and capturing bigger market share.

In simple words Market Intelligence is the latest information about anything relevant to a particular business which may affect it in any manner. It could be about:  new taxes government plans to impose,  a new substitute of your product, competitor has introduced something better ,a new cheaper source of raw material etc.

Keeping up with the change and taking prompt action is vital for the survival and growth of any organization. Big organizations have separate departments for gathering market intelligence and also they can hire services of agencies but small business have limited options. Some of the ways small businesses can gather Market Intelligence are as follows:

Customers: Always keep in touch with your customers. They are a good source of information as they are in touch with you as well as with your competitors, so many times they tell you what your competitors are offering.

Internet: Social media, customers', competitors', vendors', and News' websites reveal a lot of information. An online survey about your products / services may also be helpful. Once you get all the information then analyze it and act accordingly.

Your Sales Team: Frequently communicating with your sales team also gives you an sight about what is happening around you. Sales people are in constant touch with your customers. Also, when they go out in the market they see & meet their customers. They understand their & competitors' strengths & weaknesses. So, your sales team is one of the best sources to gather Market Intelligence.

Vendors: They can also be good source of information. They tell what & when they are going to offer something new but sometimes they also share what your competitors are doing.

Your Own Website: Track audience who visit your website. This will help you to find potential customers. Update your website or social media pages frequently and read visitors' comments regularly. This will also let you understand what is happening in your business environment.

Competitors: Always keep an eye on the activities of your competitors. Check their websites, social media pages and ad campaigns regularly. Also, visit the market to check their product price, quality, packaging etc.

Please keep in mind, gathering Market Intelligence and acting accordingly is not a one time job, for your survival and growth, it needs to be done frequently.

Hope you found the above helpful. Please feel free to comment.

Saturday, September 24, 2016

Leadership Skills for a Small Business

My last post's topic was, "Skills Needed to Run a Small Business". In that post, I mentioned leadership as one of the vital skills to run a small business. Now, in this post I'll briefly explain what leadership skills are required to effectively manage a small business:

Leadership is not a single item. It is a combination of many skills. Some of the important leadership skills a small business owner needs are as follows:

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Decision making: A small business leader should be confident & quick when taking a decision. The decision should be based on data or past knowledge. If necessary do some brain storming, research or consult your team members. Once you have all the necessary information then with a calm mind make a timely decision and stick to it. Usually little or lack of information delays a decision making process.

Communication: Good communication is a vital ingredient of any business' success. In a small business, communication should be frequent and clear. A good communication is not only important within an organization but it also helps the business owner to build good relationship with his customers, vendors, bankers, employees etc. Also, it helps in networking with others related to the industry.

On the other hand bad communication causes misunderstanding and confusion. Also, often it is the reason behind the poor performance of a business.

Delegation: Survival & growth of an organization in a long run is impossible without delegation. It not only empowers other team members but also develops future leadership. Also, it gives more time to the business owner for thinking, planing and improvement.

When a business leader shares his/her responsibilities with other team members, it makes them feel important and develop team spirit. Also, it results in increasing employees' morale, confidence and productivity. This eventually helps a business to perform better.

Adaptability to change: An ancient Greek philosopher, Heraclitus, said, "There is nothing permanent except change." Understanding and adapting the change is the key to business survival & growth. Now things change more rapidly than ever. Organization which are slower in change or do not believe in change cannot last longer.

Organizations with a climate of learning and seeking opportunities in the changing environment easily survive & grow than those which are afraid of it.

I hope you found the above helpful. Please feel free to comment.

Thursday, September 8, 2016

Establishing & Managing a Small Business

There are certain skills which one require to effectively run his/her small business. Unlike big businesses you can not afford to hire professionals for different jobs. In a small business owners need to wear different hats as per the requirement.

Some of the essential skills needed to run a business successfully are as follows:

Leadership: It is the key skill a businessperson needs to establish & effectively manage his/her business. Leadership includes planning, motivating employees, problem solving, communication, coaching employees, decision making, setting short term & long term objectives etc.

Accounting: It is one of the most important skills one needs to establish & successfully run a business. The small business owner should be able to make budget of his/her business and should be familiar with bookkeeping. Successful business owners  understand their financial responsibilities and timely execute them.

Marketing & Sales:  Small business owners should be able to market and sell their product/services. They should know who their customers are, understand their needs and maintain a good relationship with them. They should work hard to ensure that customers are satisfied with their products / services.

Networking: It helps a business to survive & grow. A business owner needs to give his time & energy on regular basis to make his/her business a success. Networking makes a business stronger as when you meet new people you get new ideas, meet potential customers, meet more vendors and others related to your business. This helps to manage business easily & effectively.

Social networking can be done by actually going somewhere and meeting the people, contacting them by phone or through internet.

Risk Taker: A business owner is always a risk taker. Taking a risk does not mean jumping from an air plane without a parachute but one should take calculated risks. When starting a business the owner should be well prepared to face all the challenges. He / she should have a good understanding of all aspects of the business.

Negotiation: It is also one of the necessary skills a small business owner needs to be successful. This skill is vital to satisfy customers and to strike good deals with the vendors.

I hope you found the above helpful. Please feel free to comment.

Monday, February 29, 2016

Risk Management in Small Business

No guts no glory. It is not possible to achieve anything in life without taking risks and small business is no exception. In order to succeed one should understand the risks and know how to deal with them. Some of the risks which small business owners may face and ways to manage them are as follows:

Departure of Key Employee: Usually small businesses have limited man power. Departure of a key employee may hamper or suspend business operation. To minimize this risk, you should be fully involved in your business,  Also, you should know the daily activities of each of your employees. In case if any one decides to leave then you can manage the work with the help of other employees till you find the suitable replacement.

Employee disputes: A small business can be run successfully only when its employees communicate and fully cooperate with each other. Disputes among employees cost heavily to the business. This can be avoided by hiring like minded employees. In case it does not work then you have to find the reason for the dispute and act accordingly to resolve it.
 Market Size Shrinks: Many small businesses serve niche markets. The size of these markets sometimes shrink due to different reasons. This causes very difficult situation for the small business and sometime pushes it towards the closure. This risk can be managed by offering more than one products in different markets. 
Arrival of competitor: As mentioned above many small businesses serve niche markets which are smaller in size. Therefore, sometimes competition makes the survival difficult. This risk can be minimized by maintaining good relationship with your customers and providing quality product / service to them. Also, as suggested earlier a business should not depend on a single product or limited market. It should offer more than one products / services in different markets

Loss of Key Supplier: It is not possible to run any business without the cooperation of reliable suppliers. Usually small businesses rely on few good suppliers. An unexpected departure of a key supplier can give a big loss to an organization. However, one can manage this risk by engaging at least two suppliers for most critical items. Also, this risk can be further minimized by maintaining some stock of those critical items so, in case of loss of the key supplier you will have sufficient time to find a new supplier.  
Equipment breakdown: This can definitely badly effect a small business. To overcome this problem small business owners should make necessary arrangement to minimize the down time. This can be achieved by having necessary expertise within the organization to fix the out of order equipment and by maintaining the stock of necessary spare parts. Also, the management should be in touch with the equipment manufacturer / supplier as well as with a qualified technician

Receiving late payments from customers: Many small businesses have limited resources. When some of the customers take too much time in clearing their dues it creates a liquidity crunch for the small business. This creates many difficulties and sometimes even jeopardizes the existence of the organization. This problem can be managed by avoiding long term credit to customers and by having a number of customers. In case some do not pay on time but others will do and this way the business operation will continue functioning. Depending on a single product and on few customers may turn out deadly for any organization.

     I hope you found the above helpful. please feel free to comment.

Sunday, January 31, 2016

Retaining Employees in Small Business

Retaining employees in a small business is sometimes not an easy task. Unlike big organizations small businesses have  smaller budgets therefore they cannot offer many perks to their employees. Small businesses have to use ways other than spending money to retain & motivate their employees. Some of the things they can do are as follows:

Respect Your Employees: The first & most important thing when you desire to retain your employees is that treat them as human beings, do not criticize or yell at them. Try not to do anything that hurt their feelings. Always be polite and talk  to them in a friendly tone. Communicate with them often and try to understand their problems.

Train & Develop Your Employees: Show them how to perform their duties in the right way. Also, time to time teach them new things. Take interest in their career development. This will motivate them and help them to work with confidence.

Give Recognition & Reward Your Employees: Every time any of your employees meets a target or perform well recognize his / her efforts in front of other employees and reward him / her by giving a letter or certificate of appreciation. Be generous with praise. This will make him/her feel good and increase employee's loyalty with the organization.

Involve Your Employees: When making decisions involve your employees. Ask their opinions and then make decisions accordingly. Keep them engaged and make them understand that problem solving and meeting targets is a team work. This will make employees feel important and they will work hard to implement the decisions wholeheartedly.

Allow Flexible Working Hours: Be result oriented and do not make rigid rules. Offer flexible working hours to your employees or allow them to work from home. As long they are meeting the deadlines you should accommodate them. Make family-friendly policies. This will provide you highly motivated and loyal employees.

Do Not Layoff Your Employees: Even in difficult times make laying off employees your last option. First focus on cost cutting. Communicate with your employees and ask them to come up with cost cutting ideas. When you will help them in testing times then most likely they will be with you when you need them.

Profit Sharing With Your Employees: Every time your organization does well and earn some handsome amount then celebrate this with your team. Also, share the profit with your employees by giving them a bonus. This will not only increase their motivation but also increase employees' loyalty toward s the organization.

Provide Good Working Conditions: Treat your employees well. Make sure the working conditions you provide encourage them to work hard and stay motivated. Give them proper tools, a comfortable place to work and all other necessary facilities which make them to perform well. Make your work place a happy place.

I hope you found the above helpful. Please feel free to comment.

Sunday, January 24, 2016

More Business from Existing Customers

There are several ways to increase your sale but getting more business from existing customers is the most economical and easiest wayUnlike big business owners mostly small business owners know their customers and they are in touch with them. On the other hand, acquiring new customers costs time, effort & money. Following are some of the actions you can take to get more business from your existing customers:

Communicate with your customers frequently: More you will talk to your customers more you will understand them and their needs. Also, time to time visit their premises, this will give you a better understanding about their requirements and give you ideas how can you serve them better.

Improve your product & service: As mentioned above, communicate with your customers regularly and improve the quality of your products & services according to the feedback you receive. Keep in mind without customer satisfaction neither you can retain them nor you can get any business from them.

Offer more related or unrelated products: Find out what else your customers need or what else they could use. You can offer them more items by increasing your product range or by offering other related or unrelated products. For example if you supply marble flooring to different home builders. You can also offer them marble floor cleaning products. Similarly you can offer other items used by them like doors, window glass, kitchen cabinets etc. This will not only make your customers' lives easier but also result in expanding your business.

Start a customer referral program: It is one of the best and economical ways to gain new customers as well as retain the old ones. Reward  your existing customers who bring you new customers. Encourage them for referrals by offering them a special discount, by giving them a VIP status or by sending them a gift,  Also, personally thank them for helping you locate a customer.

I hope you found the above helpful. Please feel free to comment.

Friday, January 1, 2016

Retaining Customers in a Small Business

All businesses need customers to survive & grow. Gaining new customers as well as retaining old ones is necessary. Here we will discuss actions needed to be taken to make them return to you again & again.

Usually, it is not possible to for huge organizations to personally know their customers but a small business has an advantage that it can meet and give personal touch to each of its customers. 

Following are some of the ways, you can apply in your small business, to retain your customers and gain their loyalty:

Honesty is the best policy: Sell truthfully. Never lie or cheat your customers. Be transparent. Always make sure that your product / service quality is up to the mark. Never compromise on quality. Make sure you deliver what you commit. Always check that your weights & measurements are as per your offer. This will help you gain trust of your customer.

Serve your customers well: A good customer service is essential for every business.  It produces satisfied customers who would like to revisit you. A good customer service includes: 
            treating your customers with respect,

             meeting their expectations and

            giving them a complaint free service.

 It is only possible when you fully understand the needs of your customers. Providing a good customer service helps you build a strong relationship with your customer. This eventually results in generating more revenue & expansion of your organization.

Communicate frequently: Always stay in touch with your customers. Try to meet them when possible, otherwise communicate them via phone, email, blog etc. Keep them informed of developments related to them. Time to time get their feedback regarding your products & service. Then take necessary actions accordingly.

Delight your customers: Happy customers are the loyal customers, who keep coming back. Keep in mind, the happy & loyal customers are the backbone of any business as they bring more revenue. The more a customer is happy the more business he / she will give you. Always give your customers the importance they deserve & delight them by:

            giving them excellent service,

            thanking them time to time,

            giving them gifts / discounts,

            being flexible with them,

            under promising & over delivering them and

            by listening to them.

Create a complaint handling system: A complaint registering and handling system plays a vital role in retaining & gaining loyalty of your customers. More quicker you respond in an appropriate manner towards the complaints more you will have satisfied customers.

When you receive a complaint listen to your customer very carefully and try to comprehend the problem. Then try to find the best possible solution. Customers are not interested in merely lip service, they want right action. Try to resolve the dispute as quickly as possible. Remember retaining old customers is a lot cheaper & easier than getting new ones.

I hope you found the found the above helpful. Please feel free to comment.