Tempus Fugit! 2023 is here with us and like every new year, there is an air of hope about the prospects of the new year. If you are a business owner, you probably have a strategy for how you plan to grow your business beyond its 2022 fortunes.
You are probably concerned about the macroeconomic prospects for the next year. Russia is still at war with Ukraine, the shocks of the global pandemic still linger, the cost of living crisis is still astronomical, and there is fear that leading economies could sink into a depression by April of 2023.
These are external factors that you have little control over - for all intent and purposes the song Que Sera Sera (whatever will be will be) offers sound advice on the strategy to take on the things that we cannot control, particularly if you run a small business.
However, there are internal factors in your business that you can take to thrive and expand in the new year. Small businesses play a critical role in the Kenyan economy and individuals by offering employment and income opportunities for individuals, encouraging innovation, and growing entrepreneurship, among others.
It is for this reason that we have considered some of the critical lessons that are needed to boost the fortunes of your small business in 2023 and beyond.
Read Also: How to Start a Business; Step-By-Step
It may sound like a cliche - and it probably is - but the world is increasingly becoming digital. There are increasingly more people who are living a fully digital life in the way they get information, make purchase decisions and engage.
One US-based study found that as many as 85% of consumers make their purchases after doing some form of research online. The percentages are probably lower in Kenya due to differences in demographics and access to technology. However, there is still a great deal of Kenyans whose first point of call when buying an item is on Google - or a social media platform such as Facebook or Twitter.
According to Data Report, Kenya had about 23 million internet users as of January 2022 - 11 million of them were active social media users. As a small business, some potential customers could easily come to you if you get your placement right.
Established corporates often have dedicated technology and marketing teams to shape the brand’s online presence. However, small businesses often do not have the budgets and the internal expertise to match that presence. However, as this article will demonstrate - an online presence does not have to be costly or a complicated process that is the preserve of techies - it is mostly about being innovative and having a digital mindset.
One of the most critical platforms for small businesses is Google business tools - particularly those that help your business stand out on Google Maps and Google searches - this is all free. You also include your contacts, images of your service or products, and your operating hours.
For instance, if you run a restaurant, people need not know your business - by simply searching on Google when they are in your area - they can see your menu and operating hours. They can also review your business which could help bring more customers in.
Having a website, an email list of your clients and an actively-engaged community on social media are other strategic business strategies that have provided extended benefits to small businesses.
A major limitation of online business is the relatively less pool of talent or expertise. A majority of small businesses have less than 10 employees and with limited budgets - the staff is hired for specific, highly-needed services.
It is common in single-owner small businesses, to find the entrepreneur performing all the tasks - from accounts to human resources to sales and marketing, among others. Sometimes it works - but we are all human and we can only do so much at a go no matter how good we are, there are limitations to our productivity.
However, it does not mean that small businesses cannot entirely benefit from the benefits of having professionals and up-to-date technology. Outsourcing has become a critical business strategy for small businesses and helps entrepreneurs benefit from expertise - without necessarily hiring full-time employees who often require a significant salary.
For instance, part of increasing an online presence, as explained in the first point - is to have a website. However, the business may not be in a position to hire a web developer - especially given that such services may be needed for only a few hours per week.
This is where outsourcing becomes critical. There are web developers who entirely serve small businesses and can do so as contractors who only take a small portion of the pay - depending on the number of hours needed. The same goes for accountants, sales agents, and even production crews.
Platforms such as Upwork, allow you a pool of the best talents globally - graphic designers, software developers, writers, videographers, statisticians, and all manner of professionals - on a per-job-payment basis.
What is more? More companies are developing software targeted at small businesses - that automate certain mundane tasks such as building a website, bookkeeping, basic accounting, and tax calculations among others. For example, a software such as Tally prime, allows business owners to get projections on revenues, costs, and profits - without requiring the services of an accountant.
The increasingly difficult business environment has necessitated the need for strategic partnerships - even among giant organizations. In 2020, for instance, Toyota Group acquired a 98 percent stake in DT Dobie, the largest authorized dealer of Mercedes cars in Kenya.
If global giants with revenues running into billions of giants have partners, why not small businesses? There are plenty of opportunities that would best be utilized through partnerships and small businesses should move more toward that direction in 2023.
The partnerships can both be local or international - since global dynamics have already made it easier for such collaboration. For example, there are small businesses in Kenya that farm agricultural produce for export. There are similar small businesses in Europe, the US, and China that are struggling with supplies of agricultural produce which they value-add and sell directly to their customers.
A partnership between such two small businesses would offer immense benefits that would increase market size and profits for both organizations. They are already happening in various sectors of the informal Kenyan economy.
Ever wondered why those nyama choma joints along the Eastern Bypass, for example, are set up outside other businesses (especially bars and restaurants)? The business sense is simple, the bars and restaurants allow multiple nyama choma operators to operate their establishments for a small fee - they attract customers who in turn spend on other related services - say accommodation and refreshments - a win-win arrangement.
Small businesses will need to collaborate more and partner more in various areas including lobbying government policies, research, and completing the value chain, among others.
Small business owners often delay the creation of company culture as they wait for the company to grow. Yet one of the biggest reasons why small businesses fail is a weak company culture and institutional memory.
If you run a small business, it may be time to be more deliberate about creating a company culture - and thinking of the business’s future in the long run. It does not take much to create a company culture. If you are an individual entrepreneur and you bring in new staff - teach them all that you know and help them understand the competitive edges that help you stand out from the competition.
One of the challenges cited by many who have worked with small businesses - is the treatment of employees in a way that makes them feel too dispensable and unvalued.
A friend of mine had his Christmas season ruined after the owner of their small company travelled for a six-week holiday on December 5 - before authorizing the salary payments to her 10 employees. This means they will receive their December holiday salary in mid-January when their employer gets back.
Whether it is your car wash cleaning staff, waiters and waitresses, your freelance barbers at your Kinyozi, or your drivers in your uber/matatu employees - make deliberate efforts to create a culture that enhances excellence in service/product delivery. The establishment of such a culture ultimately helps retain clients - but encourages growth through referrals.
The new year offers new opportunities for small businesses to grow and thrive. While the world's challenges may sound insurmountable, they offer unique opportunities for businesses that will come up with solutions to these challenges. Small businesses are at a vantage point because of the ease of turning around their strategies.
The internet revolution has leveled many business fields where large organizations would easily have trampled on small businesses. If properly utilized, the digital infrastructure could help more small businesses thrive to become great employers and drivers of economic development. Other tips include strategic partnerships among small businesses, creation of a positive company culture, and innovative outsourcing of talent and technology.