10 growth hacks for MSME biz owners
Learn how growing your business is easier than you think if you follow these 10 simple steps.
Well, the biggest area where MSMEs become sick is raising funds or capital for running their business. But, that is just the tip of the iceberg. What is more crucial for us is to understand is how did you run into cash flow or liquidity crisis? The most important thing in growing your business is that money is not the answer to all of your problems and you're not the only one facing all these problems.
“Having trouble finding good employees? Facing liquidity crunch in running your business? Do your clients negotiate a lot? Is there too much competition? ” - You're not the only one facing these issues.
Well, don't be impatient - I know you know all these things. So, let's go to the solutions. Here are 10 growth hacks I have experienced and used with my clients that you can use as well to take your business to the next level.
1. Build people - they are pillars to build your organisation.
Make sure they (top performers) leave their wisdom behind. That is the knowhow which would be systems, processes, habits, daily routines and working styles that made them the top performers and let better opportunities find them.
Startups are typical cases of leaking buckets and so are a bunch of MSMEs. The biggest reason is that your top performers outgrew your organisation. How to plug that? Simple. First things first. Chart a growth path of the top performers - see how they are growing personally and professionally. You would know when they shall outgrow the organisation. You should make efforts to retain them. However, more importantly, you need to ensure that there is a next man ready to fill their shoes and their subordinates have learnt all they could from them.
Reality Check: What legacy our star performers left behind in the organization?
2. Budget, Budget, Budget - Do it Right.
Budget is not only prepared by Finance but it is a collaborative approach of all departments.
Being in India, we wait a lot for government budget every year. However, when it comes to our own family or business, we hardly take enough efforts to budget. Hence, we never know when we run into liquidity crunches. That is because, Budget is not only prepared by Finance but it is a collaborative approach of all departments wherein Procurement gives forecast of price variations and periods of buying, HR provides for increased personnel and supporting costs, Marketing provides its planned activities and expenses, Sales gives forecast of receivables and sales projections - which is all scrutinised by Finance Department to determine the financial standpoint of the company in upcoming months.
Reality Check: Did expenditure permissions stop to a department due to budget overshoot ever? If no and still we're facing a liquidity crisis - we certainly are in dire need of a live expense monitoring system.
3. Marketing - It is not sales !
If money is the petrol which keeps your business running, then sales is the petrol pump that fills in petrol but marketing is the crude oil from where petrol (money) come.
Marketing is the backbone of sales but if we see MSME and startups - they have sales team but no marketing team and hence, market research - marketing collaterals - customer feedback - customer retention - product or service improvement is not up to the mark. Thus, this much neglected area of marketing doesn't accelerate the company. Also, a right marketing individual is one who has worked in sales for years and learnt about industry trends, consumer behaviour and the little thing that matters.
Reality Check: What are the marketing metrics in our company we analyse and what are the sales metrics?
4. Business Development is like Mr. India - invisible.
What to do to if you need more money than the one you're making from milk of your cow. Very simple. Add another cow in your shed or develop other products from milk that can yield more value (profit).
Most people do not know this aspect of business or merge it with sales. Let me help you understand - you can only milk one cow to a maximum limit within a stipulated time. So what to do to if you need more milk. Very simple. Find another cow or develop other products from milk that can yield more value (profit). Exactly, Business Development is all about this - finding newer sources of revenue to "develop" your business or take it to next level.
Reality Check: What are the new streams of revenue that came into our business last year? Have we ever pro-actively introduced a product or service?
5. Cost Management - where did the rupee go?
How many of us know about cost allocation and logic we're using to allocate costs - what is the cost per business unit or cost of one unit of product or one unit of service?
We mostly focus on our major cost areas and hence, do not strategise for cost control program - cost control is not about cost cutting but analysing, planning and reducing areas that are increasing costs. This can be known if we know about cost allocation - what is the cost per business unit or cost of one unit of product or one unit of service. This is the financial numbers that your accounting department to crunch.
Reality Check: Are we doing accounting and finance for tax purposes? Are they backbone of our business decisions or just yardsticks of company performance?
6. PR stands for Progress Report of your company !
Public encompasses your suppliers, your customers, your financial supporting institutions, your prospective employees and many more. What and if you communicate to them determines a lot how you're perceived and that's what makes a brand.
I always believe PR is not public relations but it is progress report of your company - it can tell you everything that is to know about your company. If your company is not known to people, that itself is a story to tell about your growth. If there ain't visibility - there will be no trust (brand) or credibility and hence, there will be no profitability. If I don't tell my own tales, how people shall know of my journey.
Reality Check: Do we have a PR arm or work with an agency? If yes, what are its SMART goals and how its performance is measured?
7. Industry Leaders show the way, don't follow !
If you compare yourself with the stalwart in your industry and say you're the same - its like saying I bat better than Sachin in front of TV. If you were a better batsman, you have to be on that pitch, donning that jersey.
Self awareness is crucial - you need to know that industry leaders do not do things differently, they just do it diligently. The difference between hard work and smart work is critical over here and so is that opportunity knocks the door only once. Are you always ready behind the wickets to catch that opportunity the moment it takes an edge and moves towards you? Are you agile and prepared enough to dive and take a shy at it? To be a leader, you need to think like one, act like one and behave like one. You need to be the trend setter - do not just blindly follow your competitors - try and think ahead that what could be the next step and be there first. That's how you lead by getting ahead and not by getting behind.
Reality Check: What are the new initiatives we took in the last year? If the answer is none, buddy - we would not reach the number one place anytime soon.
8. Word of mouth to Mouthpieces
It's not about word of mouth anymore. When there are so many platforms that get your customer's eyes - one microphone won't do it. Make your word of mouth ambassadors into your mouthpieces (loudspeakers).
A lot of my clients before I worked with them told me that we do a lot of great stuff for our clients but I seldom see those things in their sales pitches or marketing collaterals. Even customer testimonials is never well exploited - we always forget word of mouth is best form of marketing but the idea is to convert each mouth into a mouthpiece so it reaches to more people.
Reality Check: How many testimonials we have? How do we use it as a marketing tool? How often do we work for more testimonials?
9. Branding ain't logo or brochure - it's a lot more than that.
Branding is the perfect blend of right marketing, PR, HR, systems and processes - albeit - almost everything - which means if one thing is not sorted - we just ain't a brand.
People seldom confuse brand with luxury but luxury brands are separate topic - for example in automobiles - it's not Audi or Mercedes or BMW are "THE" brands. Maruti Suzuki is also a brand and so is Tata Nano. The brand simply conveys that it's a product of significant value and that intangible value is the token of trust in you. Other words, luxury brand try to provide luxury - look at interiors and features of Audi but Maruti gives best possible interiors in its own budget. We pay premium price for both of them but the cost price of Maruti is lower and hence premium is lower and its higher for Audi as cost price is higher. Brands command premium that improves their bottom line.
Reality Check: Do we command premium or get embroiled in discounts or negotiations? That defines whether we're a brand or not.
10. Update or Out-of-date.
The founder of camera - Kodak is no more to be seen. It was taken over by Sony digicams. They lost as well to mobile phones. When it comes to mobile phones - market leader Nokia went out - so did Motorola and Blackberry. Sony followed too and now 1+ is ruling market giving Samsung and Apple a good run. We stay up-to-date as per market trend or we will be sent home packing.
These are 10 simple growth hacks that you can work upon in your company to s but that's not all - they have top notch user interface and brilliant marketing style by creating demand in market - that's how they attached value to their brand. Samsung were first in the race to introduce big screen phones - Apple had to follow or they would have joined Nokia. It's not about now - it's about what's going to be next and what after that.
Reality Check: The simplest question is when did we last update your website? When we wanna know something, we google. So won't our prospective customers. If we are not updating ourselves there or are not present there, we will follow Nokia or Kodak's fate.
These are 10 simple growth hacks that you can work upon in your company to next level. Remember - it is not a one time activity - it is a continuous process and the actions mentioned above have to work in tandem like body parts and not independently.
Feel Free to share your thoughts in comments below.