Small business essentials must stay within prescribed budgets.
There typically isn't a huge coffer of cash to fall back on if revenues are stronger in one part of the year than in others— especially in the case of seasonal businesses. And sometimes, what you expect to profit on a project doesn't always meet your initial forecasts. A recent QuickBooks study revealed that nearly 30% of small construction companies earned less on a job than originally estimated.
So, most entrepreneurs would agree that when projecting costs, a penny saved is indeed a penny earned. That adage might certainly be true when shopping for price differentials among suppliers that offer the same commodities. However, foregoing some small business necessities solely due to cost may bring unwanted consequences.
With respect to certain small business needs and functions, the old saying might be revised to suggest that a dollar invested wisely might spare several thousand dollars worth of anguish.
You might opt for the do-it-yourself route in pursuing services small businesses need. However, delegating internally or building relationships with external consultants will create more time so you can do what you do best. Those endeavours might entail relationship-building and sales or they might involve finance and operations; below are 3 areas that you should definitely retain and perhaps outsource as part of your small business essentials.
1. Small Business Insurance Services
Large multinational corporations sometimes insure themselves. They perform risk management analyses and set aside company assets to cover potential losses, and they also pass off some risk to insurance companies.
The difference between a mega-business and your small business is scale. You likely don't have the ability to raise tons of capital and hire personnel to perform complex actuarial calculations. So, you're better off averting a financial disaster by establishing an affordable business insurance program with a trusted carrier.
You might view insurance premiums as costly but deeming an overall insurance plan as unnecessary is not prudent. Looking back at the big picture, the amount you'll spend on insuring your business pales in comparison to the loss you might incur when accidents or oversights happen. Consider all your assets— buildings, equipment, inventory, vehicles, etc.— and tally up their value. Now, consider that you can partner with Next Insurance to protect those assets for pennies on the dollar— and the insurance program you initially labelled as excessive becomes reasonable and necessary.
But, you may say, "I don't own any physical assets other than a laptop and some office supplies." That fact won't remove you from a potential liability claim. Unwittingly pass on an electronic virus to a customer, and you could be held financially responsible for an entire network of computers— and possibly a loss of income on your client's part. This very real scenario exhibits the pressing need for a complete liability package that extends to all areas of operation.
2. Accounting for Small Businesses
Numbers may be your forte and if so, that gives you a leg up when starting or assessing small business necessities.
Throughout your business's growth, accounting and bookkeeping can become full-time pursuits themselves. It's possible to record revenue, pay expenses, and reconcile bank transactions so that all the data flows into a neat little profit and loss statement. Yet, all these tasks might occupy a lot of time and distract you from other processes.
When trying to answer the question, "What do small businesses need most?", you have two options for accounting purposes. You can either enlist the services of a Certified Public Accountant (CPA) or attempt to handle all those duties in-house. Hiring a CPA to make certain that all your numbers align is a smart play. Not only will you have a professional second-set of eyes on the books but you'll also have representation from an audit standpoint. Also, creating some camaraderie with your CPA and other professionals can have added benefits.
Accounting software has become more powerful, and basic platforms for multiple users often cost less than $500 annually. Out-of-the-box capabilities for packages extend far beyond ledgers and journal entries. Some applications are capable of tracking mileage and expenses right from your employees' mobile devices, and those with or without an accounting background find certain programs easy to learn and use. As an added bonus, you can even grant remote access to your accountant if you implement that blend of internal and external resources.
In the digital age, you may be wondering, "What do small businesses need help?" Well, one of the biggest areas is launching and sustaining a marketing campaign. Thankfully, that goal has become easier and more budget-friendly than ever.
Establishing a presence on free social media sites lets you trumpet your goods and services to personal and business contacts alike. You might also contemplate building a referral network— costing little more than some reciprocation and an occasional lunch tab— among your professional contacts such as accountants, attorneys, contractors, etc. But, you can't rely solely on the hope for referrals and platforms like Facebook or Instagram to effectively drive prospects to your door.
To conduct an effective small business marketing plan, you'll want to implement a two-pronged approach.
- Use those free social outlets to create brand awareness among those you interact with on those sites.
- Consult with a marketing specialist to aggressively seek new prospects and strengthen that brand.
You may want to use pay-to-play media outlets— and you will likely find good deals on packages that combine promotional items with radio spots and/or print advertising. Essentially, you want to concoct the optimal mix of passive and active strategies.
Engaging a professional marketing consultant will work better than a scattershot method. You may find, like accounting practices, that the DIY blueprint might pull you away from more important matters like winning customers. Most marketing firms will tailor programs to meet the budgets of small businesses necessities, and as you expand, ramping up those efforts will always remain an option.
The Bottom Line
Nothing ventured, nothing gained.
That saying holds true whether you're investing sweat-equity or real dollars in your business. When analyzing what small businesses need most, the key to success is allocating both of those precious commodities wisely. In some cases, you can adopt a hybrid business model that makes the most of your strengths as well as those of outside consultants.