Growing Your Small Business

Fred: Welcome to the Scotiabank “Find the Money” podcasts. I’m Fred Ketchen, Director of Stock Trading for ScotiaMcLeod. These monthly podcasts call on some of Scotiabank’s most knowledgeable experts to help you make the most of your money. Here we’ll discuss strategies designed to put you in the financial driver’s seat. In this podcast I’m joined by David Wilton, Director of Small Business at Scotiabank. Today we’ll be focusing our discussion on small business owners in Canada, the things they need to consider when it comes to growing their business, whether they are long- established or just getting started. What are some of the top priorities for small business owners, David?

David: Well Fred, they really fall into three general areas. The first of those would generally come under the category of managing operational realities, things like human resources and technology. The second would be financial aspects of the business. So, managing your cash flow, reducing expenses… but the number one goal that we hear from small businesses owners is they‘re looking for ways to grow their businesses to take them to the next level.

Fred: Well, there must be a variety of ways to tackle the challenge of growing a small business. What are some of the ways that small business owners can grow their businesses then?

David: Well, I think the first reality to acknowledge is that each small business is unique; and, in such, there is probably a need to do a careful assessment of the opportunities that exist for each business in their specific market place. For example; you might want to consider whether you want to focus your growth strategy on existing customers. Do you want to find ways to sell new products to them, or perhaps you want to look more aggressively at finding new customers. Those would be two completely different approaches to building a growth strategy. Another thing you can look at is the geographical markets you serve. Do you want to expand within your local community or is a national expansion program appropriate, and in some cases it may even be a global program. But beyond the physical presence and the geographical location of your business, many businesses are now looking at strategies that incorporate online marketing. That’s another important thing that you should consider. Beyond who your customers are and where they are located, you probably want to look at your product mix. You should be trying to decide whether or not you should be expanding your products and services and perhaps adding new offers to your existing lines. Then, again, for other businesses they may be offering too many products and, perhaps, they should be looking at narrowing the products and services they offer so they can focus on a few best sellers.

Another thing to consider is whether or not you’re doing a good job of promoting your business with traditional advertising. Should you be looking at other low-cost alternatives or are there ways such as networking or targeting specific segments that you should consider as opposed to expensive traditional advertising? Another approach is to use joint promotions. Seek out non-competing businesses in your area who you can partner with, and by combining what you offer add new value that might help you compete more aggressively with others in your marketplace.

Fred: Well, David, these all sound like great ideas but none of them sound simple. I assume that there are some things that need to be in place in their existing business before business owners should even attempt any of these strategies.

David: Absolutely. You know looking at market opportunity is a really good first step, but you really need to look at your own business very honestly and take a hard look at your capabilities and the capacity of the business that you have. For example; you want to have a look at whether or not the operating platform that you have supports the increased growth that you’re looking at. So, you’ll want to consider operational aspects of the business, the systems that you rely on. You’ll want to look at financial systems within the business, is it capable of handling the invoicing and the management of inventory in effective ways. What about human resources, do you have the right people in place to handle the growth levels that you’re looking at; and, in today’s, tight labor markets that could be a real challenge. So having done that sort of an assessment then you want to focus on mapping out specific strategies that will address the strengths… that is capitalize on your strengths. And then work on the challenges that you’ve identified as you’ve assessed your operating platform.

Fred: Is there any one of these that is more important than the other?

David: Well, really it’s hard to pick one, but there is a characteristic that we do find in successful businesses and that is that they have really established concrete plans in terms of identifying where they want to go; and, then, they’re very single minded in taking steps that lead them to their ultimate goal. It’s a matter of building a business plan that gets you where you want to go.

Fred: And how can small business owners then get started with their growth plans?

David: I heard a great line from a business owner recently. They said that they often spend so much time working in their business that they really have no time to work on their business. And I think there’s a lot of wisdom in that statement. Small business owners tend to get very wrapped up in their business and so by carving out some time, say a few hours a day or perhaps a weekend or if you can swing it a whole week to look at the business opportunities that are before you some of the issues we’ve already discussed. The operating platform, capabilities and capacity issues of your business and with those things in mind then be very deliberate about mapping out a business plan to get you growing. Spending that time to work on your business can really pay big dividends for you. I’ve got a few suggestions that might help. We’ve pulled together a number of tools that are designed to give you a head start in the planning process. They’re assembled at a site called “getgrowingforbusiness.com”. You’ll find there a free business plan writer called “Scotia Plan Writer for Business” and it’s a really great way to systematically go through a process of building a strategy and a business plan. There’s also a sales and marketing planning tool that can help you pick the right growth strategies for your business. As well, there is an on-line form where other small business owners gather to discuss their experiences and discuss how they’re going to grow their business to the next level. It’s a great place to share ideas.

Fred: Well, thank you, David for sharing with us some important considerations for small business owners to think about when it comes to growing their business. We hope that this information has given you some food for thought and helpful advice on how to get started growing your business to the next level. Thank you for listening, I’m Fred Ketchen. For more information, please drop by your local Scotiabank branch because we’d love to have the opportunity to talk with you.