5 Essential Small Business Lessons That I Learned by Reading 50 Business Books
Have you realized that getting your business education from 60 second Instagram videos might not be your best option? Or are you worried that the 25-year-old shooting YouTube videos by a pool, might not be the best person to give you advice on growing your business. Let’s face it, if the information you are getting is too basic or too good to be true, odds are you’re not getting a useful business education.
The best way to get valuable, accurate information is to learn from the experts (actual experts), and there is no better way to really understand new business concepts than by reading business books. To become a better coach, I read 50 business books in the last year, and I have come to realize that there are 5 key lessons from those books that I share with my consulting clients time and time again.
5 Essential Lessons for Small Business Owners
1. Go find your customers
So, you have a website, and you post a couple of times a week to social media. Good enough - right? Not even close. The reality is that you can't put a few things on the internet, a place with billions and billions of activities happening at any given moment, and hope people are going to find you in that storm. You need to intentionally go out and find your customers to make your business grow.
Online, you might join a Facebook group filled with your target market and start engaging. Or perhaps you have a B2B business, and LinkedIn is the best place to make connections. Maybe Reddit, Clubhouse, or Twitch is where your community spends time online. Wherever they are, go find them and start engaging directly.
And though it may take more work, do not overlook the importance of in-person outreach. The right pop-up events can be a great way to meet customers and get the word out. Or ask for introductions from your network and meet people for coffee. Offer yourself to be a speaker at an event where you're likely to find your target market. Or go big and host your own event and then make sure you meet as many attendees as possible.
2. Have a small target market
The instinct to create marketing that appeals to as many people as possible seems to make perfect sense. “Why limit myself to one small group of people for my marketing? That will only limit sales.” So goes some very common, but very faulty logic. The reality is that trying to market to everyone means you won't interest anyone.
You do not have the brand recognition of Coke, you don't have the budget of McDonald's, and you're not ubiquitous like Amazon. You’re a small business, and you have to convince people who have never heard of your business that they should buy from you. Your content must really intrigue viewers, or they will pass on by.
This means your marketing needs to be focused on a very specific group of people - a group of people with common beliefs, values, dreams, and identities. Understand how this group sees themselves in the world. Then make sure the language you use, the messages you share, and the images you choose appeal to those specific people.
If your marketing turns some people off, that's a good sign. Passionate customers don’t come from boring marketing that is palatable to everyone. Take a stand. Insist that—cookies are better than cake, introvert life is the best life, diamonds and sweatsuits are a good fashion combination—or whatever your message may be. Your content won’t speak to everyone, but it will speak directly to some people, and they will become your passionate supporters. Better to have a small group of people who love you, than a bunch of people who don’t care about you at all.
3. Profit matters more than revenue
If social media and YouTube are your only sources of business education, then you’re probably under the impression that revenue is all that matters in a business. That's all anyone talks about. "I had six figures in sales last year.” “I bring in 30K every month and you can too!" Entrepreneurs are constantly hyping their revenue, but you never hear anyone talking about their profit. That's because profit numbers rarely sound as impressive.
But, if you’re like many small business owners and pay yourself with the profits of your business, your bottom-line should be your top priority regardless of what you’re hearing on social media.
For example, imagine you run a business that had $200,000 in annual sales, but had $160,000 in expenses. Now compare that to a business that brings in $80,000 in sales and had $40,000 in expenses. Guess what, at the end of the day, the profit for both of those businesses is $40,000. One has much bigger revenue numbers, but the take-home for both founders is the same.
If you aren't tracking your expenses, then you only have half the story about your financial success. If you're hoping to earn more money for yourself, remember that expenses have just as much impact on your bottom line as revenue and they can't be overlooked.
4. Systems bring freedom
Business systems are the key to creating more freedom in your business, and they aren’t as complicated as you may think. A check list to confirm that the customer bathroom has been correctly cleaned is a system. A video of how to create the perfect candle is a system. Systems are just step-by-step explanations on how to do repetitive jobs.
By having systems clearly mapped out, you ensure and that you or your employees create the same quality work time and time again. Training hours are reduced, and mistakes happen less frequently, saving everyone time.
Now you might be saying to yourself, that sounds great, but operating from a bunch of checklists doesn't seem very freeing. Admittedly, if you were only doing system-based work, you wouldn’t feel very free. But systems are designed to speed up the repetitive part of your work, so you have more time for problem solving and creativity. Your system on how to edit and schedule your social media posts will free up time for you to focus on designing, filming, and writing. Your standardized welcome email for a new client, will create more time to have a personal check in with them to see how you can better serve them.
Repetitive work is an inevitable part of running a business. Make that repetitive work as painless and efficient as possible with well documented systems, and you'll have more time to do the fun stuff.
5. Your network matters - A LOT
Running a business with no outside support is like trying to run a 100-meter dash hopping on one foot. It's possible, but it's going to be really slow, and you'll go through a lot of unnecessary misery. You need to have a strong network behind you to win the race.
First and foremost, your network can be your cheerleaders and word-of-mouth advocates. Even if people in your current network aren’t likely to be your customers, they may know someone who would be the right fit and can give you a referral. Or they might know someone who can get you into the right tradeshow, get you a guest spot on a podcast, or connect you with a wonderful mentor. Talk to your network about your business; you never know what they can do for you.
Your network is also essential for strategic partnerships. If you don't already know people who run businesses with similar target markets, you should make it a priority to meet them. Whether you partner to offer a product/service bundle, agree to be featured in one another's blog posts, or do some co-posting on social media, strategic partnerships are a great way to accelerate your businesses visibility.
And last, but not least, your network is key because sometimes things won't go well in your business. Having other entrepreneurs in your life that you can lean on for support and understanding is essential. They will give you advice on how they overcame similar problems, and they’ll help you get back up and keep fighting for your business.
Moving Forward
If you find that you aren’t focusing enough on one or more of these key lessons, it’s ok. Most of us are missing things in our business. There’s a lot to juggle when you’re running a small business, and you have to give yourself grace to get better one step at a time. I recommend picking out one of these that you need to improve, and create an action plan to move forward.
Personally, I am bad at going out and finding my customers. I’m introvert and COVID lockdown only boosted that natural tendency. But staying a hermit is bad for business, so I am committing to getting out in the world and meeting more people who are looking for an entrepreneur community.
What will you do to move your business forward?
