Building Your SME Business (Small to Mid-Size Enterprise) with the Right Business Essentials
Find out what principles and practices you need to pay attention to in order to grow your SME business effectively.
When you take the process of building a small business you’re taking on a LOT of additional stress, not unlike the stress of building a family and just like building a family — you’re going to want to plan this out a bit.
If you own a small business—or are thinking about starting one—you’re in good company: there are 28.8 million small businesses in the United States, according to the U.S. Small Business Administration, and they have 56.8 million employees. Small businesses (defined as businesses with fewer than 500 employees) account for 99.7% of all business in the US.
In fact, small to medium enterprises (SMEs) make up the vast majority of businesses in most countries.
There is no lack of great ideas out there, but many entrepreneurs find themselves lacking the ability to successfully market their product or scale their business effectively.
About two-thirds of business survive 2 years in business, half of all businesses will survive 5 years, and one-third will survive 10. The longer a company has been in business, the more likely it is to stay in business—it’s those first few years that are the hardest; which is exactly why you need to be focusing on the essentials for your SME business.
Probably the Biggest Hurdle for any SME business is Cash Flow
Cash flow problems are the leading cause of small business collapse, so coming up with a plan to deal with this potential threat should be on the top your list. Here are some common solutions that most successful SME’s put into place:
1. Short-Term Business Loans
There are many different ways you can go about getting a short term business loan, perhaps one of the most SME friendly is OnDeck. OnDeck offers short-term working capital loans and lines of credit up to $500K. Their application process is completely online and only takes a few minutes. They can typically have you funded in as fast as 1 business day.
These loans typically have a higher interest rate (APR), however, the total cost of capital can be less expensive than longer-term options with a lower APR. If you’re looking to obtain a short-term loan quickly, OnDeck Capital business loans may be a good fit.
With OnDeck, you can generally qualify if your personal credit score is above 500, you’ve been in business for at least 12 months, and have at least $100K in annual business revenue. This short-term loan is a good fit for businesses that need money immediately and are willing to pay it back in 3 – 36 months.
2. Business Line of Credit at a Glance
A business line of credit gives you capital to meet a whole variety of business needs. Draw on your business line of credit to get more working capital, buy inventory, handle seasonal cash flow gaps, pay off other debts, or address almost any other business emergency or opportunity.
Typically, you can get a traditional line of credit through your bank, but if you do not qualify or need access to a line quickly, you can apply to online lenders like BlueVine or Kabbage through Fundera.
Three business essentials you may have overlooked setting up your SME
Whether you’re starting your new SME from the ground up or into your first decade as a legacy business, it’s all too easy to forget about the peripherals when it comes to your daily management details. Your business success is not guaranteed, and ensuring your progress is not something to take lightly. While you’ve been concentrating on suppliers and your marketing strategy, you may be neglecting these business essentials that might just make the difference between your company turning a profit or calling it a day six months down the line.
Taking the necessary steps to protect your company in as many ways as possible is vital in the fast-paced business culture of the digital age, but keeping in mind the basic essentials can really make all the difference.
1. Is your Website reflecting you?
In the past, not every company needed to be online, but the truth is that it nowadays it is considered a business essential. Nearly two thirds, or 64%, of the recent Bank of America (BofA) Small Business Owner Survey respondents said they wish they took better advantage of technology innovations to help manage their business.
If you want to expand your client base beyond your local geography, then you need to make sure that your online presence is easily found and easy to navigate. From social media business accounts to a website that reflects your marketing and branding strategies, having a professional website is not only easy to build, it’s also increasingly important for those companies that refuse to stand still.
Having website that truly embodies your brand message with the ability to deliver your products or services on demand is also a great way to create a scalable sales structure. A website will enable your customers to get the right product in the right place at the right time. Online sales will also create a system that can be easily tracked and managed for improved sales forecasting.
According to Accenture, U.S. shoppers plan to increase their holiday spending by 11 percent for the upcoming holiday season. Meanwhile, shoppers will remain focused on the bottom line and on scoring deals. If you maintain an online store, you may be wondering whether you need to organize your sales data using some type of accounting software or if you can keep track of data yourself. With online shopping forecast to grow, make the investment now in a good software solution, so you can learn to use it and automate reporting when you are pressed for time later.
For many e-tailers, the best way to track sales is through sales receipts, which both record the amount paid by the user and the amount of the sale. If you sell a lot of products, manually keeping track of sales receipts can be time consuming and challenging. If you experience hardware failure or you lose printed copies of the receipts, you may not be able to recreate your sales records. This can cost you when tax-time arrives.
Accounting software allows you to track employees, customers and inventory in one system. This can be very valuable for busy times of year, as you can better target repeat customers and ensure that you don’t run out of a popular item, as PC Mag explains. The software also allows you to run reports, generate sales figures, view at a glance which items are unpopular or unprofitable, and generate insights that can improve your business model, according to Inc.
Some e-tailers may shy away from accounting tools because they think the tools are difficult to use or require specialized skills. While some software certainly does, there are plenty of programs available for small business owners without an accounting background.
If you have a niche business — for example, if you make and sell hand-carved clocks — you may sell only a few items for a high price. In this case, you may not need accounting software because overall sales are low. However, it is a good investment for the average SME business.
What to Look for in E-commerce Accounting
A cloud-based solution may be ideal for e-commerce owners who use the cloud to manage and store business assets, and many companies, including Intuit, offer cloud-based versions of their software that can be perfect for e-commerce shop owners. Other owners may prefer dedicated small business software, which can offer greater explanation and guidance to those who may not have accounting skills. In addition, there are lots of desktop-based solutions for PC and Mac owners alike.
Most e-commerce store owners can use generalized accounting software, which is often cheaper than specialized industry software. Before investing in any program, think about what sort of information you need to keep (say, for tax time) and what sort of information you need to make business decisions. Then look for a piece of software that allows you to handle those tasks. If you think you’ll be hiring one to two employees, you may need a solution that offers payroll services. If you’re a one-person shop, you will not need to pay extra for a program that allows you to make a payroll. Then comparison shop to get the best deal for your budget.
Making use of professionals to help you design, build and even manage your online accounts, can take a lot of the pressure from you, so that you can focus on the more important things.
2. Building a Branding
Remember, you’re not just building an SME — you’re building a brand!
Too many small businesses launch right into marketing their business without identifying clear marketing goals:
Choose your target audience.
The surest road to product failure is to try to be all things to all people.
Connect with your audience.
Your objective is to make your audience feel an emotional attachment to your brand.
Inspire and influence your audience.
An inspirational brand message is far more influential than one that just highlights product feature functions.
Reinforce the brand image within your company.
Make sure employees at every level of your organization work and behave in a way that reinforces your brand image.
Building out your brand messaging into branded peripherals can help you in a number of ways. There’s a reason why companies hand out business cards (and pens with the company logo on). Not only do branded peripherals keep you in a customer’s mind, they can also improve the professional personality of your business. Using professional staff ID Cards can be an easy way of displaying your professionalism, and by using ID Security Online services you are also adding an extra layer of security to your premises and employees. Often it’s these examples of going the extra distance that will ensure your company presents a confident, reliable and successful persona to present and future clients.
3. After service follow-up
Not every business can rely on repeat customers, but that’s no reason to neglect your after-sales service. Even for real-estate sales that will most likely never garner another sale again in the short or long term, taking the time to check up on your customers after you have provided a service can earn you word of mouth recommendations and positive social media reviews. These, in turn, will inspire new customers because they will have the social proof that you have done all that you promised and even beyond. For companies that either hope for or expect to gain a growing business thanks to repeat custom, it’s also important that you don’t neglect those dormant clients. These are the customers who were happy with your service but for one reason or another opted to go elsewhere. Picking up the phone, social media updates, and email newsletters can all help to entice new customers and re-inspire old ones.