Small business development strategies or 7 effective tactics for an entrepreneur
- Implementation of customer incentive programs without lowering prices for goods or services.
- Correct allocation of resources aimed at serving and attracting customers.
- Formation of an image of an expert for business and a leader in the media.
- Increase local popularity in order to promote the brand.
- Outline and Clear vision of the boundaries of your niche in the market for goods and services.
- Analysis of a large business as a competitor, identifying the benefits and benefits for a small business.
- Raising entrepreneurial standards.
These 7 strategies do not require specialized investments, you just have to invest your desire to develop and act. Results are guaranteed! You can emphasize a lot of related useful information from this article. And also quotes from successful strategists of the modern business world are waiting for you.
Develop standard business management skills
Intuition, emotions and advice from acquaintances are better tested in personal life than in business. Therefore, the first thing a budding entrepreneur needs is to improve their organizational standards in three steps:
- Strategic thinking and cold calculations must be embedded in the quality of an entrepreneur even before starting a company. Basic knowledge of marketing strategies, which uses tools to promote goods, set prices, search for new customers, develops a practical way of doing business. It is like a stone embedded in the foundation of a house, so your strategy must be ready before you build a foundation for business development.
- Write down your goals and remember to be real, they should be measured in time and investment, and also have their own localization. When making a decision on any topic, think about your primary goal: this decision brings you closer or rather alienates you from it. Success is the sum of small, deliberate decisions.
- Always take the time to choose the direction in which to move. Otherwise, how do you know where to go?
- Your strategy should include a reward system. Regularly reward yourself for new, even small achievements in order to be always motivated.
The tactics of raising one's own standards of managerial qualities should be applied to all types of strategies, so it comes first. If the level of the manager's quality standard is higher than the competitor's, you have a huge advantage. Develop self-discipline and defeat your competitors by working on yourself. In any strategy, it is important to manage resources, and the only question everyone has is: how are they managed? All four of the above rules will work if there is a created image of a manager and mutual support of employees according to the principle of synergy. Remember, the product itself is not everything! Firms very often focus on the product, motivating it with the old stereotype that is irrelevant in the competitive market: “a good product will protect itself”. The product itself cannot form apart from the three marketing tools: sales, distribution, and price. These elements are mutual and are born only together, creating a coherent integrity.
Strategically develop popularity with your business
How easy is it to find you? Think globally, but act locally, start being visible on your street, your neighborhood, your city. Expand the local popularity of your business with step-by-step strategies. Use the possibilities of the Internet and get interested in geo-targeting for your site. Test modern approaches to doing business, make friends with Google Analytics, check the statistics of your site. Remember, your website is not just a business card, but also a strategic tool, you only have a few seconds to attract a client so that he decides to take advantage of your offer. Think of visual design as an investment in attracting additional customers. Your brand logo should not be a work of art, its task is to convey a thematic message to target consumers. Take a high-quality surprise with the goods, regularly update the nomenclature in the price lists and prices. Fill in the contact information as much as possible, add the service: "Order a free call". Check the correctness of the site display in different browsers on different devices (PCs, tablets, mobile phones). Customers meet your apparel business. Plan a small project to develop the company's image and local popularity.
Only% of customers develop your business
The Pareto principle says about the 80/20 imbalance, which shows that 80% of the effort brings only 20% of customers, and vice versa, the same 20% will bring the business 80% of the income. All efforts cannot be equally designed for all buyers: firstly, it is unrealistic, and secondly, it is unprofitable. Look only at your target customer group, that is, the main market segment to which your proposal is directed. Think of the market as a cake. Your task is to carve out the most beautiful piece of the market for your own business. This does not mean that the big chunk is the best. Think about whether you know your customers not only from a demographic profile angle, but also from a psychological and behavioral one. How do your consumers live, what do they like, what do they expect, what unites them? Only in this way can you find the connecting thread of the proposal with the target audience of interest. In your advertising slogans, unleash the clientele problem, control the language of usefulness. Keep an eye on your promotional materials. Are they presented in an accessible language? Have you forgotten to note the benefits for the buyer? It is important for the client to get information from advertising: reliability, experience, safety. If you don't know your customer well yet, use the customer pleasure method. Use the mystery shopping method, that is, the person who will check the quality of customer service in the firm on the principle of observation. Do not be lazy to apply marketing analysis, their benefits can be objective, which you may miss. In practice, marketing tools are fairly easy to apply, and the results can be astounding.
Specialization strategy gives dominant business advantage
Good means a lot, but a lot is not good overall. If you are a beginner entrepreneur, first learn how to compete in a narrow industry. Typical mistakes that restaurateurs make are too long a list of dishes on the menu and, as a result, colossal chaos in the kitchen. The client waits for his order for a long time, after which he receives it in not the best quality. Of course, according to statistics, more purchases are made where there is more choice, but first of all, you should think about your money associated with the development of the assortment, as well as about barriers to entry of new investments. Naturally, this does not mean that he should not expand his activities. Just do it gradually as your business opportunities grow. One of the most important problems is the leftover goods that lie on the shelves. Most often, they bring losses, since they cannot be sold even at cost. The wider the assortment, the more sales, but also the more unprofitable balances. On the other hand, if a wide range of products has insufficient stock of goods, then many customers will be unhappy with the frequent lack of availability of previously purchased goods. With a wide range of products, it is more difficult to maintain a balance of surplus and shortage of goods in stock on shelves and warehouses. Be consistent throughout your time.
Do not use price discounts in business strategies
Before answering the question, it makes sense to dwell on the analysis of existing statistics in order to understand: what is small business in Russia and what is its structure. In fact, it is important for a general understanding of industry trends and the level of competition in a particular small business sector.
Small business is not only an economic, but also a legal category, because what types and forms of activity should be classified as small business is determined by the norms of Russian legislation. Now the following criteria are used to classify enterprises and individual entrepreneurs as small businesses:
- Average annual number of employees. Up to 100 people inclusive - for small businesses, and up to 15 people - for micro-enterprises (including).
- Marginal revenue from the sale of goods and services excluding VAT. Up to 800 million rubles - for small businesses, and up to 120 million rubles - for micro-enterprises. It is revised once every five years using the data of continuous statistical observation for the previous period.
- The book value of the assets. There is no decree of the Government of the Russian Federation on this issue yet.
Small business statistics are kept separate from microenterprise statistics. Let's try to find out what are some indicators of Russian small business statistics.
Small business statistics in Russia
According to the Unified Register of Small and Medium Business Entities , as of February 10, 2021, more than 266 thousand small businesses were registered in Russia. The number of micro-enterprises by the same date exceeded 2.5 million legal entities, the number of individual entrepreneurs - more than 3 million people. If we compare with the data of the previous year (see Fig. 1 and 2), the growth in the number of small enterprises is visible only in three federal districts: the North Caucasus, South and Siberian - in other regions there is a decline.
Fig. 1. The number of small businesses by districts of Russia, February 2021, according to the Unified Register of Small and Medium Enterprises.
Fig. 2. The number of small businesses by districts of Russia, February 2021, according to the Unified Register of Small and Medium Enterprises.
Nevertheless, the Central Federal District remains the leader in the number of small businesses, followed by the Volga Federal District by a large margin, and the North-Western Federal District closes the top three.
On average in the country in 2021, the number of employees of a small enterprise is 27 people, of micro-enterprises - 2 people, regardless of whether a legal entity is registered or employees are hired by an individual entrepreneur. According to Rosstat, micro-enterprises in recent years have shown better financial performance than small ones. For example, in 2021, the turnover of small businesses amounted to 44,124.3 billion rubles, of which 18,587 billion rubles were accounted for by micro-enterprises. A year later, the turnover of small businesses fell to 38,877 billion rubles, and micro-enterprises accounted for 20,138.8 billion rubles . Of course, the turnover of enterprises is largely determined by the sectoral focus, but the numbers speak for themselves.
What small business is being opened in Russia
By industry, the situation has remained stable over the past few years. Most Russians choose small businesses in the field of wholesale and retail trade, car service and repair of household and other products - this is a good half of all Russian small businesses (from 38 to 53%, depending on the organizational and legal form). It should be understood here that if these areas of business are the most popular, then they have the highest competition in the small business market.
Real estate trading follows. Various real estate services occupy from 11 to 21% of the entire market.
Business development, from the moment the company was established, goes through certain stages.
A coffee shop, a real estate agency, and large car companies all have the same processes, problems and solutions. The entire life cycle of a business is made up of these stages.
It can be compared to the existence of a living organism.
Experts say: in order for a business to develop and live, at every stage of its formation it must be “fed” with finances and fresh ideas.
The owner of the company needs to understand what stage his business is currently going through in order to know how to develop it in the future and what money is needed to develop the business.
- 1 Business establishment stage
- 1. How to raise money at the start?
- 2 Stage of reaching zero
- 2. How to raise money to reach zero?
- 3 Stage of business growth
- 3. How to raise money for business development?
- 4 Stage of business maturity
- 4. How to raise money for scaling?
- 5 Stage of business decline
- 5. How to raise money?
- 6 Does a business always go through all five stages?
Business establishment stage
The very first stage of any business is the stage of its foundation. At this stage, the company is planned, registered and created.
The founding stage is the only stage in the life of a business that they go through. This is one of the most important and important stages in life, it determines the further development of any business.
Success at this stage in the life of a business largely depends on how well you plan it. This means that the start-up costs have been calculated, risks have been taken into account, an analysis of the sales market and the weaknesses of competitors has been carried out. It has been determined which specialists will be in the team and where to look for them. The business plan is ready, it suits you - it's time to start implementing it.
First steps at the founding stage:
- registration of the form of ownership of an individual entrepreneur or LLC (consultation with a competent accountant will help you to take into account all the nuances of taxation and determine the form of ownership)
- recruitment of employees (you can contact a recruiting agency for the selection of qualified personnel or submit an ad yourself on job search sites)
- search for the first clients.
The share of small and medium-sized businesses is 20% of Russia's GDP, which makes it an important component of the country's economic growth. Small business refers to a small firm owned by one or more individuals. Such an enterprise does not have powerful production facilities and a large number of employees.
Small companies require minimal investment and generate stable passive income, and with the right approach, you can multiply your capital at times. In our article, we will tell you in detail how to properly invest in a small business and minimize risks.
Advantages and Disadvantages of Investing in Small Business
Small business investment has many benefits:
- No economic education is required, especially in the provision of services;
- Each contributor can participate in the management of the enterprise and make decisions that affect the development of small business;
- Simple and convenient control of all processes, important nuances always remain in sight;
- A wide range of areas and forms of investment;
- To organize passive earnings does not require large investments;
- Fast turnover of funds;
- Possibility to occupy a niche in the sale of goods from the sanctioned list.
It is worth remembering that investing in small businesses carries a high level of risk. The development of a company may require a lot of working capital. In addition, small firms in Russia often lose competition to monopolies - large business entities.
When organizing a small business, it is more difficult to obtain credit funds, and the investment does not pay off immediately after the investment.
Types of Small Business Investments
Investing in small businesses is classified according to the following criteria:
- Investment objects: real, financial;
- The nature of investment participation: direct, indirect;
- Investment term: short-term (up to 1 years) and long-term (more than 1 year);
- Form of ownership: private, state, mixed, financing by foreign investors;
- Geography of investment in small business: domestic, international; li >
- Degree of investment risks: risk-free, low-, medium- and high-risk, speculative (investments in the most risky assets to potentially get maximum earnings);
- Degree of profitability: non-profitable (most often it means investments in social purposes), low, medium and high income.
Best Small Business Investment Ideas
Due to the coronavirus, entrepreneurs are facing serious difficulties. According to experts, more than 30% of small businesses (MB) after the first months of the pandemic were on the verge of ruin. Therefore, they are in dire need of subsidies and assistance from the state. Everything you need to know about supporting small businesses in 2021 is gathered in this resource.
Small business support system in the Russian Federation
Support of small businesses from the state in connection with the spread of coronavirus was initiated by the President of the Russian Federation. Based on his recommendations, a full-fledged program was compiled and developed, containing a list of steps to ensure that small business in Russia does not cease to exist.
The implementation of the small business support program is regulated by a number of regulations:
- Government Decisions from 03.4020 and 10.4020;
- PP dated 02.4020 No. 409;
- ФЗ dated 15.0 020 No.-320;
- PP dated 01. 0. 020 No. 1587;
- PP 02. 9.020 No. 1340.
State assistance to the IB, including individual entrepreneurs in 2021, is carried out using different tools:
- a moratorium on bankruptcy - creditors will not be able to apply to initiate bankruptcy proceedings for a particular company;
- suspension of scheduled inspections - even those that have already been started are included in the list ;
- automatic renewal of permits and licenses - a period of six months is set;
- credit holidays - entrepreneurs have the opportunity to postpone payments for six months or reduce them;
- preferential loans for payment of wages to employees - government assistance to small businesses also includes taking care of the financial situation of working citizens. Therefore, businessmen can apply for a loan without interest to pay salary during a pandemic;
- reduction in insurance premiums - this assistance primarily affects individual entrepreneurs, whose contributions have been reduced by half;
- tax holidays - deferral of payments to the state;
- deferral of lease payments - conditions have been created for MBs from the most affected segment in which they can pay in installments within 2 years;
- targeted consulting services in the export segment;
- direct subsidies - this type of state support for medium and small businesses represents real payments in the amount determined by the number of company employees and other criteria;
- lending without refund - in In Moscow and other cities of the Russian Federation, the most affected organizations can receive a loan from the state, calculated according to an individual scheme.
Regions may supplement these measures at their own discretion. But the constituent entities of the Russian Federation have no legal basis to abolish any federal instruments.
Who can count on support?
Not all entrepreneurs in Moscow and the regions can count on help from the state. The package of measures taken affects only those enterprises that are most affected by the pandemic.
A list of nine items was originally approved:
A little later, non-food retail and several other industries were added to the list.
Before applying for state support for MB and IE, an entrepreneur must check the list of OKVED. If the number under which his activities as an economic entity are listed is not included in the list of those most affected by the coronavirus, then he may not count on a special package of measures. For him, the standard tools for supporting the IB and young entrepreneurs will be relevant.