5 Actionable Tips For Running A Successful Small Business

America’s nearly 30 million small businesses — independent business with fewer than 500 employees — are the backbone of the economy. They’ve created two out of three jobs in the past five years and have outpaced large businesses in job creation for 15 of the last 20 quarters, according to the U.S. Small Business Administration’s most recent quarterly report.^[1] Nearly 80 percent of small businesses survive their first year, but only about 50 percent survive five years or longer, according to the U.S. Small Business Administration^[2]. This success rate has been consistent over the long term, regardless of economic conditions. Keeping small businesses up and running for the long term requires business acumen. A successful small business is no accident.

Here are five tips for running a successful small business:

1) Write a business plan.

You have the idea and passion, but you need a plan. The length is not important, and the plan can evolve over time, but the key is to map the path you want your business to follow. Your plan should include a break-even analysis, profit-loss forecast and cash-flow analysis. It should also set goals and identify milestones, making it easier to measure success and keep on track. It should also identify target markets and customers. The Small Business Administration can be a great resource to help you find ideas and examples that can help you write an effective business plan.

2) Emphasize Marketing and Promotion.

Marketing and promotion are important investments in your business. Small business marketing strategies^[3] should include a clearly defined target market, a marketing and sales plan which describes how you are going to reach your target market, measurable goals, a plan to achieve those goals and a budget. This strategy should be included in your business plan.

3) Hire the right people.

Small businesses should start… small. Early miscues are easier to recover from without incurring as much debt if you start small. To grow, successful small businesses need strong leadership and an inspired staff willing to work hard to achieve the company’s goals. Hire the right people who have the skills, but also the motivation and personality to succeed within your industry and your company.

4) Develop the right product/service.

Success comes from having a great idea or product that fulfills a true customer need in a unique way. Competition abounds, so your brand must stand out. The product or service needs to be consistent in its quality and value. No matter how well-run a small business is or how well-liked its owner is, customers won’t return if the product or service is lackluster. Consider sending out customer surveys, asking customers to rate your product or service, and ask how you might improve. This will help you make sure you are fulfilling your customers’ needs. As demands change over time, make sure to update and refine the product or service to meet customers’ latest standards and expectations.

5) Make safety a business strategy.

The costs associated with employee injuries and illnesses can cripple a small business. The Occupational Safety and Health Administration (OSHA) can fine businesses for unsafe working conditions, and workers’ compensation insurance claims can cause your insurance premiums to increase. Further, unplanned staffing shortages can hurt employee morale. Small businesses must instill a culture of safety where every employee is held accountable for maintaining a safe work environment. It begins with an authentic commitment from management that makes workplace safety a strategic imperative across the organization, and the willingness to invest strategically in the business’s most important assets – its people.

For more information and other tips for running a successful small business, contact EMPLOYERS® today.