Small Business Management Tips for Success
Small business management refers to the process of aligning and coordinating all aspects of a small business, whether it’s managing your employees, suppliers, business finances, its roadmap or performing your daily tasks.
Managing a small business presents some unique challenges for the owner. Apart from the knowledge of the basics of small business principles, you also need to know financial management, human resource management and the laws and regulations related to your business.
What this article covers:
What Is the Definition of a Small Business?
According to the US Census Bureau, about 99.7% of all companies in the United States are small businesses. While there’s no consensus as to what constitutes a small business, the Small Business Administration (SBA) usually considers a company with fewer than 500 employees to be a small business.
Apart from the number of employees, the SBA uses other factors to determine whether a company is a small business. For example, is the business headquartered and operate in the U.S., is it a minority player, is it independently owned, is it a profitable venture etc.
The reason why businesses are classified as a small business is that the management and operational issues of these businesses differ vastly from large corporations. By defining themselves as a small business, you can win contracts and avail business loans from the government. You also get access to tools that can help you compete against larger businesses.
Unlike large corporations, small businesses have limited budgets, far less bureaucracy and maybe catering only to a regional geographic area. They’re often focused on providing high-quality customer service and using creativity and innovation to create better products and services.
What Is Small Business Management?
From creating a business, determining funding requirements, managing employees, overseeing marketing and advertising and managing your own time, small business management involves coordinating all aspects of the business to ensure that it keeps on growing and achieves success.
Here are the ten things you should know about small business management:
Create a Business Plan
To create an effective business plan, outline your business goals and objectives and provide a succinct description of your business and the products or services. Include the details about the market you’re about to enter, your marketing and sales plans and your financial projections.
Review your business goals regularly to see what’s changed, what’s been achieved, and what needs to be revamped.
Separate Your Personal and Business Finances
Since the taxes for you and the business are calculated separately, it’s necessary to open separate personal accounts that are designated for only business transactions.
Determine Funding Requirements
If you’re starting a new business, funding the operations of the business is the topmost priority. Whether you’re opting for personal investment, angel investment, business incubators, bank loans or government grants, it’s important to familiarize yourself with the advantages and disadvantages of these funding sources as well as the criteria they use to evaluate the business.
Hire the Right People
If you want your business to thrive, it’s important to hire motivated, high-energy trainable people who are looking for success rather than making a quick buck. As a small business owner, you need to know how to retain valuable employees by offering them perks such as flexible schedules, happy hours and team building activities.
Train Your Employees
Even if you hire the smartest people in the world, it’s going to take some time for them to understand the ins and outs of your business and figure out how to put things together to achieve long-term goals. This is why training your employees well is vital for a small business. Create a training plan that makes your employees feel more competent and empowered in their jobs.
Keep Track of Your Finances
When you start a new business, it’s easy to keep track of the money coming in and going out of the business. However, as your business operations grow, this task can become a headache. This is why you should either hire a full-time, on-staff accountant or simply invest in an easy-to-use accounting software that helps you keep track of your finances and save your precious dollars.
Invest in Marketing
In a world where brands are constantly competing for consumers’ attention, small businesses need to force their way in front of people, show them something valuable and somehow have them listen to their pitch. Research the different small business advertising and marketing options before choosing a marketing model that works best for you and the business.
Learn to Delegate
Time management is crucial for small business owners. A part of managing your time involves being able to delegate work to those awesome employees you’ve hired and trained–especially tasks that you don’t really enjoy doing or those you know you’re not very good at.
What Does a Small Business Manager Do?
In a small business, the owners either manage the business themselves or hire a business manager to handle business operations.
Managing a small business entails having a variety of knowledge or understanding relating to business topics. It’s a job of the manager to oversee the activities of the employees; hiring, training and evaluating new employees and ensuring that the business is on the right track of achieving its financial goals.
Listed below are some of the key responsibilities of a small business owner:
- Oversee the daily activities of employees
- Recruit, hire and train new employees
- Ensure the day-to-day operations are running smoothly
- Manage inventory and make purchase decisions
- Handle production, marketing and administrative functions
- Design and implement the company’s budget
- Set sales goals and ensure that the team is on track to achieving them
- Ensure the financial goal of the business are being achieved
Managing a small business means managing all aspects of your business whether it’s your time, employees and other resources as effectively as possible. Learning innovative, new ways to manage these aspects, you can make your business more productive, and your life easier.