Sizing up the challenges of small business
Experts weigh in on the top five concerns of small business owners and offer some helpful advise
During a July 2010 survey, Staples Canada got a glimpse of what’s keeping many small business owners up at night. Here’s a look at some of these key ssues and what business experts have to say about them:
Cash flow, lack of revenue stream and poor cost management were the biggest concerns for small business owners, according to the Staples survey. Sandy Huang, president of Vancouver business consulting firm Pinpoint Tactics, says it’s important to have a strong relationship with your bank or account manager. “Then it’s easier to persuade them to release their hold on payment cheques from your big clients,” she says.
Twenty-two per cent of survey respondents said drumming up business from new or existing clients was a big challenge. All the more reason to stay the course with your marketing strategy, says Huang, even if funds are tight. David Simpson, director of the Business Families Centre at the Richard Ivey School of Business in London, Ontario, encourages business owners to look for customers who will be passionate about their product or service. So if you’re a chocolate maker, for instance, target the foodies and chocophiles out there because they’re potentially your most ardent champions.
Tight deadlines and lack of work-life balance
Simpson says many business owners suffer from what he calls “founderitis”—thinking that only they can do the job right and solve problems. “But by passing authority to other people, you’ll not only free up your time, you’ll also benefit from an influx of fresh ideas.”
When it comes to finding and retaining good employees, small businesses often can’t compete against their larger counterparts. And many small companies can’t afford to hire the staff they need. Huang suggests outsourcing or, better yet, hiring an intern. “You need help and here’s someone looking for experience,” she says. “It’s a practical and mutually beneficial solution.”
The introduction this year of harmonized sales tax—or HST—in British Columbia and Ontario was a big bump in the road or many small businesses. “A lot of companies are offering discounts or swallowing the HST themselves,” says Huang. “It’s not a bad interim strategy, at least until their customers get used to the HST.”