Try-It-Out Tuesday: The Secret to Small Business Survival - Jean Chatzky - Making money make sense
Jean Chatzky Facebook Jean Chatzky Twitter Jean Chatzky Instagram Search Contact Me

SUBSCRIBE TO HERMONEY

Hermoney iTunesHermoney SoundcloudHermoney StitcherHermoney TuneinHermoney Spotify

Try-It-Out Tuesday: The Secret to Small Business Survival

Posted by Maggie McGrath

Small business owners, forget about bookkeeping, marketing and even doing inventory. While all these tasks are important to eventually cross off the to-do list, they are not the ticket to true small business success. For that, says one expert, it is necessary to look solely towards the customer.

“I think that people are looking for the answers to the success in their business everywhere except their customer,” said Joseph Callaway, co-author of the New York Times bestselling Clients First. “If they think about the customer and what they can do to make that customer experience better, [their business] would grow and prosper.”

Callaway, like other small business owners, knows that prospering is easier said than done: the Small Business Administration says 68 percent of new businesses survive only two years, 46 percent make it to their five year anniversary and just 34 percent see ten years or more. What’s more, a recent survey by marketing firm Constant Contact revealed that a majority of small business owners say it’s harder to run their business than ever before.

Craftsman in workshop using laptop“The prolonged economic downturn pushed them to get rid of all their help,” explained Gail Goodman, CEO of Constant Contact. “Whether it was the part-time accountant for their books or an extra sales clerk on floor, slowly and surely every spare resource was pulled out. Business owners themselves are doing many more tasks; they’ve always done a lot but are now doing more than before.”

Wearing many hats may have helped successful business owners get through the economic crisis, but it’s a strategy that some say can damage a business in the long term.

“It’s not that they’re not honest or not competent, but their focus is on everything but the client,” Callaway said. “They’re focusing on policies, procedures, and at end, they’re thinking about the customer. They need to think about the customer first and work backwards.”

Callaway and his wife, JoAnn, are real estate agents who say that the words “clients first” changed their lives, and their business. Once they made it their mantra, Callaway explained, they were able to sell thousands of homes and reach $1 billion in real estate sales.

“The way we define care: we become the client. What they want, that becomes what we are driven to get for them,” he said.

Goodman says that the ability to give that type of personal touch is one of the most valuable tools in a small business owner’s arsenal.

“I think the big advantage small businesses have is customer intimacy and the ability to make intimate relationships. I think they need to remember, they have in a small way, a significant competitive advantage,” she said. “They don’t have to pretend to have customer intimacy. They are actually talking to their customers.”

Goodman also noted that “buying local” is a shopping trend, and one that small businesses owners should leverage into support for their store. One way to do this is to band together with other businesses in the area.

“A town near where I live did a combined sidewalk sale. It was the power of multiple businesses working together: while each store had its own Facebook fans and mailing list, together they reached all,” she said. “It created a local event. They had a lot of foot traffic.”

Special events and marketing aside, Callaway insists the secret to success comes down to an adage that all small business owners have heard before, and may have been tempted to disregard.

“The customer is always right,” he said. “Even when they’re wrong.”