Small and a medium scale enterprises are generally family run businesses which have been running for 20 or more years. These businesses have become like institutions where the fathers and grandfathers teach ethics and tricks to their children and grandchildren about how to run a business. The new start-ups also hesitate to try something new and resort to the traditional tricks applied by the other SMEs around. But it is very important for SMEs to unlearn the existing knowledge, practices and believes to sustain and grow in business.
Let us reflect on some of the outdated business tricks used by SMEs which led to low business or downfall.
Believing in Only Cash Transactions
Demonetisation had an immense negative impact on the SMEs last year when there was limited cash flow. Why? Because still most of the SMEs deal in cash than in plastic money. But when the whole country is resorting to UPI, payment wallets and online transactions and even the government is supporting the same, how can an SME remain in business without enabling these modes of the transaction to its clients and customers?
Using advanced technology is a must to sustain in today’s changing business and shift from cash to cashless transactions is a prime step towards a successful modern business.
Not sure which electronic method of a transaction will suit you best? Which payment gateway will give you the best deal? Engage a business consultant to help you in this regards.
It is still one of the outdated tricks followed by SMEs to pay their suppliers and employees late. Even though it is a small or medium scale enterprise it is of ultimate importance that you maintain professionalism and business ethics.
A happy supplier will always provide you with standard products at a good rate; a happy employee will not leave you and it is a known fact that experienced employees are more productive.
SMEs often resort to fraudulent activities like operating a business under multiple names and manipulating books of accounts to evade taxation. But avoiding taxes is not the right way to get more business.
Transparency is a must if you want to sustain in business. If once you are penalized for these activities it can be a big loss on reputation which is tough to recover. Moreover, when you will have multiple companies running, producing the same product, the process may get complicated and clients might be confused; this kind of confusion is not right for a smooth business. Business consultancies can help me be compliant with the existing rules and regulations and have a clean business.
Operating business by word of mouth
For SMEs what the owner says is ultimate. He/ she might change the decisions or process of work anytime. But this is not a reflection of authority but an example of an unstructured business. SOPs or Standard Operating Processes are just not some documented files but the backbone of a structured business.
It helps you cater to the requirements of all clients in a similar way and ensure that the job is done right at the first time. An owner might always not be right; an SOP captures the Voice of Customers and transforms the same into relevant and meaningful KPIs for the employees.
When customer expectations are met you can get more business and more revenue. But it is really not that easy to frame an SOP. It should be clear and crisp so that every employee can follow it with ease. A business consultant can help you capture Voice of Customer (VOC) in the right way, blend it with best practices followed by big brands and help you implement the same in the organization.
Last but not the least; SMEs often make the mistake of using aging technologies as these cost less and have been traditionally used by their descendants. Let a business consultant identify the best technologies for you (like cloud storage systems) based on your feasibility.
So break through the shackles of outdated tricks and believes, adopt new technology and strategy today if you want to transform your small enterprise into a brand. Engage a business consultant to be better prepared for a dynamic business environment.
To read more article related to this topics click here: 05 Most Effective Ways to Make your Business Plan | YRC, Are your Employees Happy? Assess it in These 5 Ways… | YRC, What is the Importance of SOPs Behind Organization’s Success? | YRC, Now Investors can Invest in Bollywood Through Franchising | YRC, 5 Ways to Organize SME Businesses | YRC.
YRC is an “Expert Service Division” of Mind-A-Mend Consultancy Pvt. Ltd.
Chief Strategy Officer