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Business Management Basics: Seven Factors for Success
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All business owners want to be successful. This article outlines seven aspects of a company that require effective management. You can always find ways to create a "well-oiled machine." Improvements typically translate into returns on your investment.
1. Marketing – Product, Price, and Positioning
Timing is everything. Snickers, Tootsie Pops, Mars bars, and Three Musketeers were all created during the Great Depression of the early 1930s. During stressful times, people turn to comfort foods. Chocolate candy is an inexpensive choice that also relieves cravings & releases endorphins. At this time, perhaps the best item to market is digital information. People surf for information everyday on a variety of electronics. How-to videos, webinars, articles, ebooks, and podcasts have all seen an amazing increase in demand. The out-of-pocket costs are very low and you can create these materials at home on the computer in your pajamas.
2. Finance - Earning money and accounting for your receipts
If you’re not earning money, it’s time to close shop. Be creative. Get paid for freelancing. Develop a good checklist for minimizing losses. Increase profits by upselling & outsourcing. Keep your receipts and organize them by month so you won’t scramble for information at tax time. Many small business owners fail to itemize expenses for this very reason. Make sure you don’t miss the major deductions.
3. Production - Creating with consistency and high quality over the long term
Customers don’t want to spend their hard-earned money on products that stop working or break shortly after purchase. They also don’t want to pay for shabby services. Dependability will add a premium value to your business. Your customers will notice and start talking about your merchandise (or service) to their family & friends. The word of mouth factor (viral marketing) cannot be denied. Every company of every size strives to achieve this on some level.
4. Distribution - Getting your products or services to market timely and economically
The channel you select will be determined by the type of merchandise you sell or service you offer. Research the distribution system of your competitors and copy what works for them. Some products are appropriate for convenience stores, others fit best in wholesale, direct sales or larger retail establishments. Protect yourself with an agreement with the manufacturers. In regard to marketing, you’ll need to implement offline and online strategies. Here are a few examples:
Offline:
- Print advertising in newspapers and magazines
- Radio/TV ads
- Flyers, postcards, brochures, and door hangers
- Cold calling
- Event sponsorships
Online :
- Pay Per Click (PPC) ads, such as Google AdWords
- E-mail marketing
- Blogging
- Videos
- Widgets
- RSS feeds
- Affiliate programs
- Social media networking
5. Research & Development - Innovation, reinvention, and responding to the competition
This process can consist of several steps before the prototype is finished, beginning with developing ideas. Next, you’ll have to work through the product’s design, engineering, market research & analysis, and price. Not all of the steps are always necessary. Also keep in mind if the item is very technical, development research can be very expensive. One way to spread this cost is through business partnerships. IBM used this strategy in 2001 (not the first company or instance) and they’re still collaborating today.
6. Government Regulations - Complying with all federal, state, and city laws
Every state has rules regarding the issuance of a business license. Check the website of the Department of Revenue in your area. For a quick search, check Business Licenses and Permits. The restrictions, approval process, and fees will differ from state to state.
The procedure could include some or all of the following:
a. Legalizing the structure of the business
b. Registering the business name with the Secretary of State
c. Registering for a Federal Employer Identification Number (EIN)
d. Registering with the Dept. of Revenue for a Business Tax Number
e. Initial consultation with a city representative
f. Completion of an application
g. Review of the physical location, if any, by a Zoning representative for a permit(s)
h. Review by an inspector, if necessary
i. Issuance of a certificate
7. Labor - Finding the people you need and training & developing your staff
Personnel are extremely important. It’s the highest expense of any company when you consider recruiting, payroll, insurance, and retirement costs. The collective ideas of staff can propel businesses into the billions. Uncontrolled behaviors and poor management can propel companies into failure. (Look at the Bernie Madoff fiasco). Office policies are crucial to every business. A non-hostile, supportive workplace environment ensures optimal employee performance. Other factors are important, such as mentoring and continuing education on office technology, safety, and diversity.
Control these issues and enjoy the results of planning your destiny!
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