Tips
Tips: Do you wish to secure a sustainable future for your business by fostering its growth and boosting its profits? Perhaps you are considering hiring external experts to assist you with the strategic reorientation or realignment of your company? However, do major management consulting firms seem too expensive to you? I offer to guide you with the help of:
seven tips to stimulate growth for small and medium-sized enterprises (SMEs).
To present these tips to you in an even clearer and more concrete manner, I have chosen to illustrate my arguments in this blog post using the information technology (IT) sector as an example. Nevertheless, my recommendations are equally applicable to all small and medium-sized businesses seeking to expand their operations.
Every year, the Bitkom association forecasts accelerated growth and workforce expansion for companies within the IT sector. As the head of an IT SME, you are undoubtedly asking yourself—almost despite yourself—the following question: “When will this dynamic of change finally reach us?” From your current perspective, substantial revenue growth seems like nothing more than a distant dream.
Therefore, the question inevitably arises once again: How can you generate revenue that surpasses your current results within your IT business? After all, the fact that your company’s trajectory does not reflect the general market trend is certainly not due to a lack of motivation on your part. You simply could not do any more—despite already working tirelessly, day and night.
Seven Tips to Help SMEs Grow Their Businesses
Tip 1 – Generate Profit by Outsourcing:
As a small or medium-sized IT business—or as a software developer—have you ever wondered how to cut costs? Do you feel there is little potential for savings in this area? After all, don’t you only purchase new laptops for yourself and your employees every few years, at most? If so, I invite you to take a closer look at the working hours you—or one of your permanent employees—devote to relatively undemanding tasks.
Ultimately, it is by boosting your operational efficiency that you will achieve cost savings. This will allow you to focus on your core business—developing new software—while outsourcing simple programming and graphic editing tasks to external collaborators. Freelancers from around the world can handle these time-consuming tasks through online platforms, and at a fixed price.
Here is an example based on my own experience: I recently needed an elaborate graphic visual element for a presentation, but I didn’t have the time to create it myself. My graphic designer had already left for the weekend. Consequently, without delay, I turned to a freelancer to create a striking design for the modest sum of about 8 euros. Compared to the several hours of computer work that would have been subject to payroll taxes and social security contributions, this turned out to be a genuine “bargain.” Undoubtedly, tasks of this nature exist within your own company as well. Which activities could you delegate away from your permanent employees to entrust, instead, to freelancers?
Your IT company will gain efficiency thanks to the working hours thus “saved,” enabling you to take on additional projects. You will generate growth by leveraging your core competencies, without incurring the increased business risk associated with hiring new permanent employees.
Tip 2 – Optimize online Marketing:
Tell us—honestly: how long has your website been online, practically unchanged? A year? Two years? Or perhaps even longer? If that is the case, it is unlikely that you are experiencing significant business growth driven by online customers. The reason for this—among other factors—lies with Google.
Without specific localization and up-to-date search engine optimization (SEO), your website will simply disappear from search engines’ radar. If your site is already two years old, it almost certainly lacks mobile optimization (responsive design). This means you are already losing every potential customer searching for IT companies via their smartphone (which currently accounts for nearly 50% of all users). And this happens, quite simply, because Google has excluded you from its search results.
Tip 3 – Do Not Neglect New Customer Acquisition Despite
A bulging order book offers no guarantee whatsoever of future security. Small and medium-sized enterprises in the IT sector often feel overwhelmed by the influx of orders, while simultaneously harboring the—illusory—sense that their position is permanently secure. During these phases, they neglect the acquisition of new clients. Analyzing the structure of your client base allows you to determine whether such an approach is prudent and conducive to future growth.
Regrettably, small IT firms often find themselves completely consumed by orders from just a few major clients. Once a large-scale order has been completed, the only option left to them is to send their employees on vacation.
Tip 4 – Plan for Payment Delays:
Not all clients settle their invoices on time or in accordance with established agreements. On a small scale, while certainly frustrating, this situation remains manageable. In principle, the risk is particularly low with small clients, as they pay cash for their goods or services. The situation is entirely different with large clients: their orders are settled under deferred payment terms.
Your profit forecasts could practically crumble if one of your major clients fails to pay on time or does not settle the agreed amount. The interest incurred on a bank overdraft will inevitably plunge you into the red, given that you, in turn, are obligated to settle your own upfront costs within stipulated deadlines. Large-scale orders rarely generate profit margins high enough to absorb the cost of such overdraft interest. Furthermore, the risk that a payment might be withheld—for instance, pending the correction of “defects” that have been the subject of claims—is extremely high.
Tip 5 – Plan And Act With a View To The Future
As a small or medium-sized IT company, your competitive advantage lies in your flexibility to respond quickly to market trends. This agility and responsiveness allows you to capture attractive niche markets even before industry giants have completed their planning stages.
Identifying which innovations hold promise, defining the future direction of your business, or formulating a financial plan are tasks that are rarely possible to master alone. Yet it is simply unthinkable to leave everything to chance. This is where expert consulting comes into play – a strategy that leaders in the IT sector pay a premium for to ensure their future growth and, in doing so, accelerate their business development.
Companies can strengthen their strategic planning by relying on trusted and credible business intelligence when evaluating partners, competitors, or potential customers. Platforms like Tofler – which offers 360-degree business analytics reports – are extremely effective in providing a comprehensive overview of financial data and risk indicators, thus helping organizations make informed business decisions.
Tip 6 – Look For Alternative, Innovative Advisory Services
After all, it is not just the IT sector that is evolving. Although your market research might suggest otherwise, new consulting concepts are currently revolutionizing the management consulting market.
You are no longer required to entrust the entire management of your operations to a local consultant in order to give fresh momentum to your growth. It is now more efficient to opt for a different approach—rather than embedding the consultant within your premises for several weeks—in order to amortize the consulting fees accumulated over the years.
Tip 7 – Online Corporate Coaching is more Efficient
The Internet is currently reinventing the business consulting sector. The new culture of coaching is now characterized by the efficiency of targeted advice—in contrast to the traditional practice whereby a consultant would quickly overwhelm small IT firms with the sheer weight of their fees.
For instance, there are affordable online workshops dedicated to video editing—known as “webinars”—that you can attend from the comfort of your own computer. In this setting, recognized professionals provide you with essential background information as well as the latest insights into business management, often supplemented by an extensive Q&A session.
When distributed among an appropriate number of participants, the speakers’ fees cease to be prohibitive. You do not receive a “pre-chewed” innovation concept, but rather assistance designed to foster your own autonomy.