The New Year is a great time for small businesses to strive for new goals. Faced with a challenging and competitive climate, economic uncertainty and problems stemming from the looming fiscal cliff, more owners are reinventing the way they do business for 2013.
In mid-2012, 43 percent of small business owners indicated that they considered business conditions “as positive,” according to a Citigroup survey. Most — 53 percent — also claimed that they have reinvented their business as a way to keep their competitive edge in what nearly 40 percent dubbed as an “extremely intense” business climate.
After the presidential election, as uncertainty over the fiscal cliff and tax hikes looms larger, sentiments have changed, and small business owners as a group are now more pessimistic than they have been in two years, according to the Wells Fargo/Gallup Small Business Index. In that survey, one in five (21 percent) business owners anticipates cutting payrolls over the next year.
Meanwhile, 34 percent expect to decrease capital spending in the next 12 months. Unlike larger businesses that have greater brand awareness and bigger budgets, small businesses are getting creative to thrive in 2013.
Faced with a tough outlook for the coming year, small business owners — including manufacturers — are attempting innovative strategies to boost performance. These new methods include overhauling products or services, increasing sales and marketing efforts and adjusting technology and staffing infrastructure, according to the Citigroup survey.
“Small-business owners are especially adept at reinvention — whether because of obstacles or new visions for growth,” Maria Veltre, managing director of Citi Small Business, said.
Many manufacturing firms are also working to reinvent themselves at a time when numerous jobs are going unfilled as emerging technologies outpace workforce development and training.
A key part of keeping a competitive edge in the industrial sector is researching and implementing different business strategies and leveraging new manufacturing technologies. “[The] U.S. government needs to begin developing coordinated policies to support R&D, public education and further investment in this new approach to manufacturing,” according to Techonomy. Innovation centers, such as Ann Arbor’s National Center for Manufacturing Science and the Michigan Economic Development Corporation, serve to help small to midsized manufacturing businesses in the region.
Yet small businesses owners without such immediate aid can reinvent their current strategies. Here are a few approaches to consider for 2013:
Set a Business Culture Standard: Cross-training employees and creating a “learning-culture” is an effective way to create a more knowledgeable workforce. Programs such as the recent knowledge building seminar developed by Enterprise Systems Partners and the Manufacturers Resource Center can spur manufacturing operations and innovation by encouraging manufacturers to transfer skilled knowledge across their workforce.
Re-evaluate Customer Communications: Of the 750 small business owners surveyed by Citigroup, 70 percent indicated that they increased their face-time with customers to keep business thriving. To do this effectively, business owners should consider the entire consumer base, and develop a deeper understanding of their customers — even those who represent lower profit margins, Intuit points out. It’s also valuable to gather feedback and focus on the consumers who aren’t buying to figure out why they’re reluctant to do so.
Pursue a Solid Business Plan: Once a small business lays out a plan, whether it involves upgrading tech and computer systems, marketing through new channels or cultivating a knowledge-sharing team, the next step is to set actionable deadlines for it and share them with other business owners for valuable feedback, Entrepreneur suggests.
|Percentage of U.S. Small Business Owners Reporting Positive Business Conditions Nearly Doubles Since 2010|
|by Citigroup, Inc., June 06, 2012|
|Wells Fargo Small Business Index: Business Owners Turn Pessimistic in Post-Election Environment|
|by Wells Fargo, Nov. 30, 2012|
|Small Business Owners Reinvent to Survive and Grow|
|by The Associated Press, Nov. 14, 2012|
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|Plenty of Manufacturing Jobs, but too Few Applicants|
|by CNBC, Dec. 7, 2012|
|How the U.S. Can Reinvent Manufacturing|
|by Techonomy, Sept. 8, 2012|
|Innovation Center Aims to Boost Small, Midsize Manufacturing|
|by Crain's Detriot Business, Nov. 13, 2012|
|Manufacturers Urged To Share Knowledge|
|by Lehigh Valley Business, Nov. 15, 2012|
|4 Tips for Reinventing Your Business|
|by Intuit, July 25, 2012|
|A Five-Step Guide to Reinventing Your Business|
|by Entrepreneur, October 18, 2011|
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