Small Business Owners Wanting To Increase Cash Flow - Their struggle to overcome 'themselves' being the biggest hurdle
I recently came across an interesting article written by Ari Galper, which pointed out a common attitude many small business owners have when it comes to receiving advice to improve their business and solve their problem. It got me thinking about those hard working small business owners who have their business on the market privately (for an unrealistic value) and wondering why it's not selling. Here's the article:
"David, who owns a local corner deli/grocery shop just around the corner from my studio office is a very pleasant fellow.
Whenever I walk into his little store, he’s always chit chatting with his customers as if they are his friends.
After all, he’s been in business for over 10 years in our same neighborhood so most of the local residents consider David and his store part of the community.
I probably go into his store a few times a week to pick up a carton of milk or some bagels for the kids for the weekends.When I’m in the store and David isn’t talking to customers, he’s often asking me about my business and how I continue to grow it with very little resistance.
I explain to him that it’s a combination of having a restless entrepreneurial mindset of never accepting the status quo and a total commitment to continually making changes to get better results.
Over the past year or so he has confided in me that he is frustrated with how much income his store is creating for himself and his family.
He desperately wants to generate more profits from his store.
Being a generous person and often being accused of having a soft heart, I could feel his frustration and I offered to give him some actionable advice that could immediately grow his business, take it to the next level and of course, create more profits for him and his family.
Here are the 10 marketing ideas I shared with him…
1. Start collecting the addresses of each customer who enters your store using a raffle for a give-away of a valuable prize (e.g. Dinner on the town, tickets to the Opera House, etc.). He’s never ever collected one address of a customer.
2. Raise your prices 10% immediately, it will be unlikely anyone would really care that you did and you’ll be earning more take-home profits right away.
3. In the awning of your store (it’s plain now without just the name of his shop on it), add a large photo of yourself with your name next to it, so it’s clearly visible from at least 100 feet away. "YOU are your business I told him, not the products in your business." I explained that the close relationship that he has with his customers should be the primary message that is felt when people think of his store.
4. Create a monthly 4-page printed newsletter to send to his customers every month that shares more about him and his family, stories of his work in the community and a feature of his new specialty products he is bringing into the store each month.
5. Create a monthly promotional post-card campaign that goes out to a select group of customers with the promotion speaking to the nuances of each segment (e.g. Men, women, families, kids, men who exercise, women who are in mother’s groups, etc). The more you speak to individual needs, the stronger propensity of customers who are willing to listen.
6. Paint and redesign the inside of the store so it feels “high-end” to meet the level affluence of the neighborhood. (The store is pretty dingy with boxes laying around, it’s looks the same since the day it opened he told me), make it memorable and pleasant.
7. Create a protruding flag or sign that sticks out away from your store so when people drive by it, they can see your face as a reminder that they should feel comfortable visiting you at any time.
8. Turn the front of the store into a coffee/juice bar with stools on the sidewalk so you can create a new revenue stream of “to go” offerings that don’t require people who just want a drink.
9. Mail out coupons, not with discounts, but with value-add upsells like buy one get one free with an expiration date.
10. Create a monthly “event” in the store that brings people in just for the “event”(i.e. face painting for kids, make your own sandwich bar, etc.).
Those are the marketing tips I gave him over an approximate 12-month period.
Do you know how many he has implemented?
Only one.
He implemented #2, raising his prices.
I asked him how come he’s only done that one, and he said “Because it was the easiest”.
I was in the store last week and he shared with me his frustrations that he wasn’t bringing enough profit home to his family. The exact same conversation we had a year ago, after I gave him the above (too many, pretty basic marketing tips) advice.
Turns out he just doesn’t want to do the “work” to make a better life for himself and he continues to remain in the same spot he’s always been."
Unfortunately this is a common attitude amongst many Small Business Owners. If you want change, you must action 'change'. Getting help with your business, whether it's from a trusted advisor or other sources is one thing - putting the recommendations into effect is another. In some cases, just implementing a few small changes can make a marked difference in increasing the value of a business.
So why is great advice ignored? With many small business owners, it's as simple as pride. Nobody likes to be told what to do in their own business. It isn't easy swallowing your pride and putting in the elbow grease. Often having to do additional work can be like moving a mountain. But the simple truth is that without hard work and changes things remain the same - with not so happy outcomes. Being forced to sell isn't usually on the raidar of most small business owners either.
So why is great advice ignored? With many small business owners, it's as simple as pride. Nobody likes to be told what to do in their own business. It isn't easy swallowing your pride and putting in the elbow grease. Often having to do additional work can be like moving a mountain. But the simple truth is that without hard work and changes things remain the same - with not so happy outcomes. Being forced to sell isn't usually on the raidar of most small business owners either.
In the current economic climate, it is now an absolute necessity (given a business is not making a profit) to make improvements to increase the value and differentiate the business from it's competition. Running a small business with an open attitude, 'actively' working in the best possible position to 'sell' whether now or in the future is a great way to run a small business, especially if at the start of business ownership.
