As anyone who’s ever had to do it can confirm, running a small business is no simple task. In many ways, you’re tasked with solving a very similar set of problems to that of a larger enterprise – just with less resources and personnel!
Larger firms can afford to handle many operations themselves. They have the internal resources and budget to look at things like accounting, marketing, IT development, and many other areas in-house. The small business owner will typically have to deal with all these areas as well, but in the context of external providers.
This general truth brings us on to one of the core truths at the heart of running a small business – it’s all about relationships.
In this article, we’ll run through what that means by taking you through a quick list of some of the key relationships you’ll need to manage as a small business owner. These are likely to be much more personal in nature than those in larger firms as you’ll be dealing with people face-to-face more often than not.
Let’s start with the most important one.
Now some of you may be demurring at this point and saying “surely the most important relationship is with your customer?” Yes and no is the answer. The reason we’re putting relationships with employees first here is that if this relationship is compromised, your chances of building a good relationship with customers goes out the window.
We’ve probably all seen examples of this in the real world. An obviously enthusiastic small business owner let down by sullen or disinterested staff, for example. Don’t let this happen to you.
Hiring is the single most important facet of most businesses and that counts double when you’re running a small one. You’ll be handing over potentially massive amounts of responsibility to your employees so the initial hiring and, crucially, the ongoing relationship thereafter need to be right.
As a small business owner, you may not always be able to offer the same range of benefits and bonuses to an employee that a larger firm can, but you can compensate for that by making them feel truly involved in building something and making them feel part of a tight-knit, positive team.
Taking the time to manage these employee relationships can be challenging in the often chaotic environment of a small business, but it’s an investment of your time that will pay off in spades down the line.
As a small business owner, you often have a unique advantage to leverage when it comes to managing relationships with your customers. You’ll almost certainly have much closer interactions with them than the average huge, faceless organisation and this is something that most customers cherish.
Take advantage of this by offering the personal touch whenever possible, and going the extra mile in terms of automating aspects of this if possible. Investing in a simple Customer Relationship Management (CRM) system – available for mere dollars a day these days – will let you and your team reach out to customers at just the right times to keep the relationship fresh and profitable for many years to come.
Don’t be afraid to use many of the customer relationship techniques larger firms do – discounts for regular customers, loyalty schemes and so on. In the context of larger firms, these often come off as too automated or impersonal but they can be excellent revenue opportunities for small businesses when handled with the right degree of personalisation.
Professional Service Providers
We’re going to lump a number of disparate groups into one bucket here: lawyers, insurance companies, accountants and banks. Basically, any professional service provider you feel compelled to put on formal clothing to visit!
The types of relationships you’ll have to manage will vary here but all are potentially incredibly valuable long-term ones for your business. A good accountant or lawyer, for example, should actually save you money over the course of your professional relationship. A carefully cultivated relationship with your local bank can turn them from potential adversary to valuable business partner.
Negotiating relationships with these professional service providers over time is an essential part of managing risk, protecting your business and employees and being able to plan for the future. It’s well worth putting considerable time into getting the right partner in place at the outset.
Sales and Marketing
Sales and marketing is another of those classic areas that every business needs, but that not everybody can afford to do in-house from the offset. It’s also traditionally an area where many small business owners come a cropper with building the wrong relationships.
Both sales and marketing should, technically, be relatively cut and dried affairs. Marketing’s job is to drive leads. Sales’ job is to close them. Sadly, in the real world, there is often a lot of smoke and mirrors when trying to find reliable third-parties to take on these business functions.
Whether it’s SEO outfits that promise the moon but deliver nothing but headaches, or marketing firms happy to spend a budget within weeks but less comfortable talking about actual conversion stats, finding reliable assistance in these areas can be tricky. That’s why relationship management is such an important part of the process.
This begins with first meetings. Any sort of internal doubts or misgivings should be taken as a sign that something may well be fishy. You’re looking for a partner to build a straightforward, mutually profitable relationship over the long-term.
The areas we’ve covered above are just a small subset of the overall set of relationships a small business owner may have to manage over time. Depending on the nature of your business, you could be dealing with external development teams, key parts suppliers, and warehousing and distribution partners, to name but a few of the possible options!
The key thing to recognise is that all of these disparate people are not mere resources to be managed, they are relationships to be maintained. As with any relationship, there will be ebbs and flows, shifts in the balance of power, occasional fallings out and many other intangible factors to deal with.
Successful small business owners are characterised by their skill and flexibility in navigating these waters. Make sure that relationship building is at the core of your wider skill set and long-term success will be your reward!