Small Businesses. The other side.
Today, I am writing something which I really don’t know if it should make me sad or should it inspire me to push harder.
Firstly – If you have a secured job and thinking about starting your own business, really (and I mean REALLY) consider if it is worth all the hassle and getting your name out there. Some are lucky in certain industries, and some of us (who need to survive in a saturated market) need to push ourselves extremely hard to make living. So, think hard and do your research well enough to make sure that from the micro up to macro factors will make your business unique and stand out so that people can make use of your services and you can actually make money and grow your business in your geographical location.
We all know, with the macro factors currently at play in South Africa (volatility of the Rand, political uncertainty, etc.) everyone thinks twice before spending a cent on something. Personally, I can’t understand why businesses (which can make use of our small-businesses’ services) would rather make use of larger enterprises or not even thinking about what’s best for their own business. Of late, I have literally seen it with my own eyes, that a customer would spend large amounts on leisure items (and I mean big bucks) and would not invest in fixing / upgrading / maintaining their ICT side of their business. When they realize they must do something about it, then a friend of a friend’s brother who is still in school “can fix their IT problems” for free because he managed to install the latest cracked version of the latest game. Don’t know about you who are reading this article, but I assume some of you can relate to this as well. And this is the type of stuff which costs our small businesses dearly, and at the end of the day, creating skepticism at a client when hiring a new service provider (and which will cost them more to fix the initial issue and the stuff-up of the schoolboy). And situations like this, are getting even more common in smaller towns (IMHO).
So enough bitching for now about stuff we don’t have control about. What can we do as small businesses to make a living and grow our businesses? The one big elephant in the room to clear first, is that we should stop undercutting each other, because this is the first thing competitors do (small businesses and bigger companies included). This is the one thing I see so much. At the end of the day, the one that undercut the most, are shooting themselves in the foot, because how can you run a business to make a little bit on one sale, which at the end of the day costs more on logistics, time and other expenses JUST to get the deal? We can debate about this in the comment section, but this is something which I see between competitors. In our industry (ICT), the majority of us makes use of the same distributors, so we know costing on products being sold, so why go just above cost just to get the deal? Retaining a client? When I implement discount for a client, is that I take into consideration how much time I should allocate to win this deal, as well as would it be worth the hassle to compete with the large retailers when the customer already told you “but I can get this same unit cheaper at this or that shop”. They already made up their mind so to speak, and one of ten would maybe support you as a local business. So, the big thing here, is that we are competing with large enterprises which imports a ton load of products which they can sell at better prices, or just have huge markups because they can do it. What should we do?
Well. What I have experienced is that when a client is set to save one rand, they will not buy from you. Thinking out of the box and being creative and market your products and services in such a way which might attract customers. By checking analytics of mass marketing emails sent, only about 8-12% of recipients will open your marketing email, and maybe 1% of those who viewed your content, MIGHT be interested, but only stays interested. You planted a seed which will make them think in the long run, “hey, I remembered this deal at this company”, and there you might get a deal done. But as you can see, it is a very small portion of people who will support you only from your marketing.
So. What can we do? At the end of the day, you need to have extensive knowledge about your products and services which you have to offer, because someone with just a tiny hint of something better, will take your potential business. Stay up to date with your field of products and services. Be creative. Don’t get yourself involved in too many side-businesses which could lead to some passive incomes. Focus on YOUR primary business. Forget about the competitors for a little while, but also keep an eye on them – you might just learn something as well. You can sometimes provide services which your competitors can’t provide (well, I know I have some services above many competitors in my region) and propose a partnership with competitors (well, those who aren’t stubborn, ignorant and naive). This should also be done very cautiously, as you might just lose all your clients to a competitor. Maybe that is a stupid idea – it is up to you.
At the end of the day, small businesses can only survive and truly succeed if they have something unique to offer in a market where those services are truly required and try and have the best after-sales customer support. For a one-man-show, this might seem like a lot, but hey, give it a try. If you are a new entrant in a saturated market, you will need to prove yourself to be better. Don’t think it is easy to have your own business. It is really freakin’ hard work and a different kind of stress. Be realistic with yourself. Don’t underrate yourself, but also be aware not to overrate yourself. BE REALISTIC.
And for people not running small businesses (or other small businesses which requires services and products from other small businesses), don’t be THAT guy who source their business from another place out of town. Support local. We have skilled, talented and great products and services to offer. When you support local, you help grow on your local economy. You help families make a living. You help those families put their children through school. You invest in someone else’s future and dreams. You make a difference in someone else’s life who want to give up on their business, because others make use of businesses out of their local region. As small business owners – let us stay positive in these tough times. It will get better. It must get better.
Thank you for reading this article. Please feel free to leave your comments below and let us discuss if you are also in the same boat. Maybe give your advice as well.