Most of the people reading through this blog will either be running an SME, working for an SME, or thinking about setting up an SME. Chances are, you are probably going through MohrWolfe’s blog to get some insight into how you can optimize your business and make your enterprise work out in the long run. As a successful SME, we can tell you this: it is not easy.
It’s crazy to think that even though SMEs comprise up to 40% of the national GDP in most economies, SMEs face incredible hurdles that large corporations and public sector enterprises do not. Perhaps they really were lying all along when they said size didn’t matter.
Despite this, we still stand by the proverb that performance matters the most. Just because it isn’t easy, doesn’t mean it’s impossible to sustain your business or even make it grow into something bigger. Ultimately, success as an SME boils down to dedication, consistency, and having insight into the challenges involved and working around them.
Conceptualizing a business model that works
The biggest choke point for most SMEs, whether they are just starting or have been in operation for some time, is attracting customers and maintaining profitability. This is especially the case when an SME is in a very competitive market with peers offering similar products or services, making it difficult for the business to stand out among other similar or more established firms that have secured their share of the market. But how exactly do these firms set themselves apart?
Well, it all starts with having a strong brand. Of course, this entails having an eye-catching logo and using striking colors that capture the attention of prospective customers; but note that branding goes deeper than that. Building a strong brand entails having an identity that resonates with your audience through effective visual, verbal, and written communication. Using tools such as social media coupled with an informative yet concise website is a good way to engage both existing and prospective customers to allow them to get to know you as a company. Even large corporations pay millions to get their branding right and convey the messages they want to disseminate.
Read more about branding here: https://mohrwolfe.com/threesomes-in-business-3-things-to-focus-on-when-growing-your-business/
Once the customers start pouring in, businesses must then find ways to maintain their profitability. It’s true that this is easier said than done, but successfully doing so often entails keeping in mind three basic principles: increasing costs, increasing turnover, and maximizing efficiency. This could involve evaluating your relationships with suppliers and partners to ensure that costs on your side remain as low as possible while ensuring you get the most value out of the transactions you make with them. Another way to ensure profitability is to look at your processes and optimize the value you provide to your customers by offsetting losses that come about through inefficiencies and backlogs. COVID-19 has reminded many SMEs of the importance of doing this in order to survive these difficult and evermore competitive times.
Effective leadership and valuing your team
MohrWolfe stands by this very simple principle: your company is as good as the team you have with you. The most successful businesses, whether they are an SME or a global conglomerate, thrive off of talented individuals that add value to their firm’s products or services. This could mean having a group of bakers who make the best burnt Basque cheesecake in town or industry leading programmers who can tip the tech world on its head.
But this doesn’t stop at simply finding and hiring the best talent you can come across. The most important thing to consider is being able to retain these talented individuals who can help you build your vision for your company. This means making team members feel appreciated for the work that they do for the company through fair compensation, benefits, and even training opportunities that allow them to grow their skillsets. In fact, the vast majority of employees who leave their companies, in spite of receiving good salaries, do so because they feel unappreciated or burnt out from overwhelming pressures they face in the workplace. Always keep in mind that while you can have the best technological tools in the world, your company’s true asset is its team.
Another way to retain your team is to ensure that you display effective leadership and have a firm vision for the company as a whole. This means inspiring them to become team members who are making a difference rather than just employees waiting for a paycheck every month. After all, we all want to feel like we have a greater purpose.
Leveraging technological tools
It’s 2020. If your business has not embraced the magic of technological tools such as social media and other tools that automate labor-intensive tasks, you’re doing something very wrong. Technology plays a pivotal role in the business community and various types of software are now available to make challenges easier for businesses to overcome. This can come in the form of marketing tools, project management software, or accounting programs that can help you automate the most mundane tasks so you can focus on the ones that truly add value. The investment is worth it.
We won’t sugarcoat anything and tell you that running an SME is easy – it’s really not. But keeping these things in mind will get you started on your journey towards dominating your market.