Having been a small business owner in the past, you quickly realize that you are affected by the economic climate quicker than larger companies. This can have a shock on the economic system since small business make up the great majority of businesses in the United States. According to the U.S. Small Business Administration Office of Advocacy, “American small businesses are the bedrock of the U.S. economy. There are more than 25 million of them in the to the Census Bureau. They employ more than 58 million people, that is a greater number of jobs than big companies, and they create more new jobs each year than any other sector.”
So how can your business learn to succeed despite the up and down cycles that it will inevitably experience? In case you missed our big launch last week, Network Solutions partnered with the Robert H. Smith School of Business at the University of Maryland, College Park to create the Small Business Success Index. The Small Business Success Index located at GrowSmartBusiness.com was designed to measure how successful small businesses believe they are in six key areas of business that include: capital management, marketing and innovation, human capital, customer service, IT deployment and compliance.
You can start by measuring your business, which we talked about in our last post, but you can two other important things to succeed despite the economic downturn.
Be Optimistic: Customers Buy from Positive People
During times when the news is negative and people are fearful to spend money, it is hard not to feel down and depressed and join in the groupthink. Just so you don’t think being optimistic is just sunshine and lollypops or hiding your head in the sand, it really comes down to how customers perceive you. If they think you are freaked out and running scared, how are you going to run your business let alone serve them. These are the times that people are thinking about taking advantage of the slow economy and shopping for new vendors. Don’t give them an easy out.
And if you are a numbers person, the Small Business Success Index captured the pulse of America’s small businesses and found that they are “optimistic, regardless of the current gloomy economic situation”. The report revealed the follow sentiment of small businesses.
- 23% of small businesses believe the economy will improve in 2009
- 26% of small businesses believe it will remain unchanged in 2009
- 48% of small businesses expect a decline in 2009
Be Contrarian: Invest in Your Company and Customers will Invest in You
Being optimistic is a contrarian concept and how you must work so you can keep your business running on all cylinders and retain the customers you have while getting a few new ones in the process. If you look back at history, which is a great teacher, you will see that those who were most successful and invested in their people and their customers skyrocketed when the economic cycle started to move upward again.
The Small Business Success Index survey revealed that “small businesses are still investing in their companies, in spite of the 48% of small business owners expecting the economy to be in decline in 2009″.
- 25% plan to increase their overall business spending
- 42% plan to spend the same
- 31% plan to decrease their spend
- 23% plan to increase spending on professional development of employees
- 26% plan to increase their marketing budgets, especially for online advertising and website development
So How Do You Plan to Succeed?
You can see how the majority of business plan to ride out this current downturn, so what do you plan to do? What other things are you doing in your business to keep your customers and be ready to grow when the economy kicks into gear again? Leave your thoughts and ideas in the comments.