Top 5 Small Business Do’s & Don’ts

As part of Small Business Week 2014 #SBW2014 across Canada, Tuesday I attended the Toronto Board of Trade luncheon with Jean-Rene Halde, President & CEO of the Business Development Bank of Canada (BDC).  Mr. Halde spoke about the importance of small and medium sized enterprises (SME) to the Canadian economy, and outlined the results of a BDC study of over 1,100 companies to determine the top 5 activities that SME business owners can do to lead to success, and those which occur that can lead to failure.

BDC is dedicated to serving entrepreneurs, so their interactions with thousands of businesses provides them a unique perspective to determine key SME business drivers.

BDC Luncheon at BOT Oct 21 2014 - small

Jean-Rene Halde, President & CEO of BDC

 

Panel Discussion at Toronto Board of Trade

Panel Discussion at Toronto Board of Trade

Following are my notes from the session.  At the end of my notes you can download the BDC’s complete list of Do’s and Don’ts, to share with your management team and to keep in a handy place for reference.

 

Top 5 Small Business Do’s

1. INNOVATE

– continually offer new products and services, adapt to changes and embrace technologies.  Do not assume past successes will continue into the future without adjustment.

2. ASK FOR OUTSIDE ADVICE

– seek advice early, establish an Advisory Board or gather a select group of people outside of your business to give you honest, unbiased advice.

3. HAVE A SOLID PLAN & MEASURE PROGRESS

– have a plan about how you will operate and grow your business and measure progress.  As carpenters often say, “measure twice and cut once”.  So plan, execute, validate, measure, adjust the plan and improve continuously.

4. HIRE THE BEST & KEEP THEM ENGAGED

– do not just fill seats to get anyone doing the work needed, i.e. do not take the BTN approach “Better Than Nobody”.  Instead take the time needed to find the best person for the role.   With all your employees, keep them engaged, and this does not just mean with money.  Leadership is multi-dimensional and employee engagement is part of the mix of what a leader needs to ensure happens.

5. BUILD STRONG RELATIONSHIPS WITH KEY SUPPLIERS

– ensure you treat your key suppliers as partners.  Building an ecosystem of suppliers that you need for business success is important.  And from a practical perspective you never know when you may need to call upon these suppliers for a favour.

 

Top 5 Small Business Don’ts

1. RELY ON TOO FEW CUSTOMERS

– diversify your customer base so you are not relying on any one or two customers.  If they run into problems, your business will also run into problems.  No customer is too big to fail – remember GM’s bankruptcy?  Therefore you need to have at least a few significant customers.

2. UNDERESTIMATE THE IMPORTANCE OF FINANCIAL MANAGEMENT

– you do not want to look at your company’s bank account and just realize you will run out of money next week.  Ensure you understand the profitability of each of your products and services in detail, by geography, by customer, by each metric that is important to that specific item.  Focus on cash.  As they say, “Cash is King”, and this is for good reason.

3. LEAVE CONTINGENCY PLANNING UNTIL IT IS TOO LATE

– plan for contingencies early, before you need to act.  If you wait too long, it may be impossible to react to implement corrective action in time.

4. IGNORE WHAT IS HAPPENING IN YOUR MARKET

– change is happening faster and faster.  Competitors are able to mobilize quickly, popping up to steal market share because customer demands are not static.  Pause periodically to take a look around to see what is going on in your industry, as well as in other industries that can impact what you are doing.  Learn, and  look at things from a higher level.

5. WAIT TOO LONG FOR HELP

– seek advice early while there is still time to implement options. Do not be afraid to ask for help.

 

The Bottom Line

The bottom line is that really none of the Do’s and Don’ts are revolutionary. They are common sense.  This is great news since this means there is really nothing mysterious about how to achieve business success.  It is all about having a good idea, turning that idea into a product or service that satisfies customers’ wants, determining how to bring the product or service to market in a competitive way, executing, measuring, and continually innovating and improving.

Of course this is easy to say, but in practice takes lots of work.  I obviously get this, as I am also a small business owner, so the fundamental dynamics are the same for my business as they are for yours.

What I think is positive here is that by paying attention to the fundamentals you too can do what every other successful business does. Sometimes it is lonely at the top, especially as a small or medium sized business owner. Remember you are not alone, and fundamentals never go out of style. Over-night successes are rare, so keep working and adjusting and do pay attention to the Top 5 Business Do’s and Don’ts.

 

DOWNLOAD TOP 5 BUSINESS DO’s & DON’Ts

Note: Adobe Reader is required to view the PDF documents above. To download on your Windows PC, right click on the link above. To download on your Mac, click and hold down the mouse button.

 

George

 

 

 

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