More than five million people took the leap to start a small business in 2021. This is a 53% increase from the number of new business applications filed in 2019.
It’s an exciting time to start a small business. It’s never been easier or more cost-effective to start a new business.
What you don’t realize is that once the excitement wears off, you have to do a lot of hard work as a small business owner.
Small business owners work more hours than the average worker. They’re more likely to have financial stress and mental health issues.
This is mostly due to the challenges of growing a small business. If you want to know what it takes to grow a small business, keep reading.
This guide has tips for small business owners that show you how to grow your business and make it successful.
1. Scale vs. Growth
Do you really want to grow your business? Small business owners believe that the one thing that will solve all of their problems is more revenue.
They believe that more revenue means more money and they won’t have to struggle anymore.
The thing to be aware of is that you can have more revenue, but your operations expenses increase to meet demand. You’re in the same boat you were in earlier, you just have more customers to serve.
Scaling means that you’re able to handle more customers while keeping your operations costs the same. The business is capable of handling more customers without adding more employees.
2. Create Your Business Goals
If you want to grow your business, you need to define what business growth looks like. Does that mean more revenue? More customers? Improved profitability?
To some small business owners, growth means that they hire more employees. They make the assumption that they have more revenue to be able to hire employees.
When you set your business goals, use the SMART goals formula. This gives you and your team the clarity to measure and move towards them.
3. Discover Your Brand
Can you sum up your business in one word? That’s a difficult task, but that’s what branding does.
A brand is the emotional glue between you and your customers. For instance, if you look at Apple’s brand, it’s about ease of use.
Google’s brand is about making information convenient and accessible. Coca-Cola’s brand connects happiness with carbonated sugar water.
The brand of your business is what you want to be known for. Sum it up in just a few words to make that emotional connection with your audience.
4. Assess Your Business Model
Your business model might be getting in the way of business growth and scalability. For instance, coaches, consultants, and trainers are the product.
They have a limit as to how many clients they can handle and how much work they can do.
If they charge low prices for their services, they’re barely making a living. It’s not a sustainable business model.
What does your business model look like? It might need to be changed to fit with your business goals.
You might need to shift to a subscription-based model to guarantee recurring revenue each month.
5. Create Business Systems
Small business owners spend too much time on small tasks that don’t generate revenue. Where there are things that need to get done, this largely amounts to busy work.
The most effective small businesses have business systems in place to perform certain tasks. Every task has a documented process that allows anyone to complete it.
They also use automation tools to handle repeatable tasks. Instead of having someone do data entry work, they automate those processes.
The resources that get freed up go towards other tasks that need focus and attention.
Look at all of your business processes and systems. Discover where you spend the most time. Find ways to automate as much as you can and free up your time to work on things that make money.
6. Create a Business Culture
If you don’t know what your values are, you can’t communicate them.
Your business values are simple phrases that let people know what your business stands for.
Clear and honest communication, respect, diversity, and the ability to dream are some examples of company values.
It’s not enough to craft nifty sentences and put them on your website. You have to live them.
The values are the foundation of your company culture. Even if you’re a solopreneur, you have to define the culture of the business.
The culture comes through in how you present yourself to clients. It ensures you attract the right clients to your business.
When you do hire employees, you’ll already have a set of clearly defined values and culture in place.
7. Employee Recruitment and Retainment
Your employees are on the front lines of your business. They’re the ones that interact with customers and vendors the most.
They represent your business and brand. One bad experience with one of your hires could be devastating to your business.
Hire the right people from the start. This is why company culture is important. You might not be able to afford a huge salary, but you can offer a great place to work.
When you hire employees, get clear on what you’re hiring for. Know the skills and experience the position requires.
Small business owners’ advice talks about hiring the best employees, but too many people fail to realize that it’s just as important to retain them as it is to recruit them.
Small businesses lose at least $26,000 a year in employee turnover costs.Make them feel heard and valued. Have a long training and onboarding process.
8. Reduce Business Risks
Being in business means that you take on a lot of risks. It’s part of business ownership.
You put your time, money, and energy into building a business knowing that it could come crashing down like a house of cards.
Things happen that you can’t control that could cost thousands of dollars. A major storm could flood your warehouse and ruin your entire inventory.
A cyberattack could compromise your customers’ payment information, leaving you liable.
Customers could trip and fall. You get sued and have to pay legal fees.
Small business owners have to learn to mitigate these risks. Take out comprehensive insurance policies to protect all aspects of the business.
This gives you peace of mind and you can turn your attention to growing a small business.
9. Know Your Target Market
Now that you worked on the internal systems of your business, let’s look at the external factors that lead to small business growth (and scalability).
No matter how you market your business, it takes a clear understanding of your target market to do it well.
Successful small business owners know it goes much deeper than knowing basic demographics. They know the emotional reasons behind a purchase.
Someone doesn’t buy weight loss products because they want to lose weight. They want to feel confident, healthy, and attractive.
Consumers don’t purchase a high-end watch because they want to know what time it is. They can check their phones for that.
They want to show their status as a wealthy person by showing off their watch.
Think about your products and services and why someone would buy them. The more you can understand a customer’s emotional needs, the easier it is to communicate that in your marketing.
10. Use the Right Digital Marketing Strategies
Customers are online. There’s no doubt about that. Ever since the start of the pandemic, consumers flocked online to make purchases.
That trend is here to stay.
Your business has to be online, too. Digital marketing is the key to business growth. It’s cost-effective, but it does require time and consistency.
Emphasize your marketing efforts according to your target market. If they spend time on YouTube, create a strong presence there.
You should also emphasize search engine optimization. Just about everyone uses search engines to answer questions and research products.
You’re going to have more traffic to your website, so it needs to be redesigned to make the most of it. Create a website designed to convert customers to leads.
Set up an automated campaign to nurture those leads and turn them into sales.
11. Have a Referral System
Most small businesses get new businesses from repeat and referral customers. They wait for referrals to show up, instead of actively seeking them.
Every person you come across is a potential referral source. Create a system where you ask for referrals regularly.
12. Create a Customer Experience
What’s a customer experience? It is an experience made up of every moment a customer engages with your business.
It could be as simple as seeing a social media post or as intense as a customer service call.
Small business owners who create an enjoyable customer experience see substantial returns. Customers who are happy with the experience are loyal and spend more per transaction.
They’ll also tell their friends about your business.
Create a map of every single engagement a customer can have with your brand. This visualization lets you see how you can impact the perception a person has of your business.
Work on each touchpoint and you’ll be able to see improvements over time.
13. Outsource to Scale
Earlier, you learned the difference between scaling and growth. Scaling makes the most sense for businesses that want to be more profitable.
How can you do more with fewer resources? Outsource.
You probably outsource things like accounting and bookkeeping.
Outsourcing digital marketing allows you to grow your business in a way that is scalable. Marketing delivers a return on investment. It also saves time because you don’t have to do the work yourself.
14. Measure Results
Don’t just focus on social media followers or how many likes a particular video gets. Focus on the things that align with your business goals.
For instance, if you want to lower operations expenses, then use that as a key performance indicator.
Measuring the right results gives you the data to make strategic decisions. The key metrics to follow are the average order value and the lifetime value of a customer.
If you know these metrics, you can take steps to increase both. Increasing the average order value by a few percentage points could work wonders for business growth.
15. Ask for Help
Small business owners get taught that they have to bootstrap and do everything on their own. That’s a lie.
It’s OK to be vulnerable. It’s OK to not have all of the answers. It’s OK to ask for help.
The people closest to you don’t understand what it’s like to operate a small business. They don’t understand the challenges and struggles you face.
It’s best for your sanity to surround yourself with people who are business owners, too. You can create a support system full of people who get it.
Business Growth Guide for Small Business Owners
Growing a small business takes work, but it also takes knowing what to do. The old thinking of adding more customers just doesn’t work.
You need to be able to do more with less. This guide for small business owners has all of the tips on how to manage a small business that’s efficient and effective.
Put these tips for small business owners to use and you’ll see results in your business.
Check out the SEO section of this site for more digital marketing tips.