“Small business” —does the name indicate all that a small business truly is? The common perception that is attached to small businesses is that they are miniature versions of regular and large-sized enterprises. In an extension of the same assumption, by default, it is also believed that small businesses are limited in their workforce, capital, and ultimately, profits. However, in this day and age, such a restrictive assumption is far from reality.

A small business can fulfill big goals when the right business strategy is applied. In my previous blog, I spoke about the importance of choosing the right business idea and subsequently, converting it into a business reality. Once a small business owner has the right idea that has the potential to hit their goals, they are already on the right track.

At this stage, it is important to acknowledge that business goals are not unidirectional. While profits might appear to be the most popular goal of entrepreneurship, several businesses are built for other purposes. These goals can vary from social causes, community building, and sustainability, to even building a legacy.

However, be it large profits or other large ambitions, certain aspects are overlapping for a small business to achieve these goals. One of the major commonalities among several small businesses is that they try to create a niche in an overcrowded market space, with several competitors, including the bigger players. This problem can be countered in two major ways. On the one hand, small business owners can choose to start the initiative in a way that is unique and unexplored. Essentially, they could adopt the blue ocean strategy. However, due to the highly idealistic as well as risky approach that this path would have, a majority of first-time small business owners are driven to more tested waters. Instead of viewing this as a loss or a disadvantage, the successful entrepreneur will change their lens to view the opportunity for small businesses despite the competition.

To put it in one word, differentiate.

Ambitious entrepreneurs should convert their disadvantages into opportunities by changing their perspectives. For instance, if a business at a micro or small level caters to a certain geographic location, it should focus on building a strong and loyal consumer base. Similarly, when it comes to sourcing, they should adopt cheaper and more efficient local options that will help them optimize their costs. Even when it comes to building a dependable workforce, hiring local people and upskilling can prove to be more feasible and rewarding than recruiting from the market.

Another major determining factor for the success of small businesses is financial planning. In the absence of an unlimited fund source, entrepreneurs need to dedicate considerable planning efforts to forecasting the fund requirements as well as maintaining reserves for unpredictable scenarios. Flexible borrowing options and schemes should be researched and tapped with the same spirit that an entrepreneur would research their consumer demand.

In the end, the role of a small business owner is not for the faint-hearted, but small steps with balance and foresight can prove to be transformative and ultimately result in big, profitable leaps.