November 28, 2012

Successful business strategies revealed

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Business Development Working on Deals from Infusionsoft. Success partly depends on how small businesses adapt to the changing environment and embrace new technology.

Infusionsoft - www.infusionsoft.com/Flickr Creative Commons

Business Development Working on Deals from Infusionsoft. Success partly depends on how small businesses adapt to the changing environment and embrace new technology.

By Britney Clapp / For CU-CitizenAccess.org — Since 2008, the U.S. economy has taken a downfall, and many businesses have been forced to close. Fortunately, businesses in Champaign County have not been as permanently damaged.

“While the Champaign County has suffered since 2007, we were not hurt as much as most of the state and nation,” Cameron Moore, the chief executive officer of Champaign County Regional Planning Commission, said.  “We seem to be recovering faster than many areas and currently most economic indicators are trending up.”

Champaign County has a diverse economy, and overall, its general economic make up has not changed much since 2007 with many jobs coming from agriculture, health care and government.

“(We rely on those and) our position as regional commerce center to provide most of the energy for our local economy,” Moore said.

Characteristics of successful businesses

“Successful business owners can both lead the organization and delegate responsibility,” David Sinow, a finance professor at the University of Illinois, said. “Owners surround themselves with employees who are smarter than they are as well as employees with specialized skills.”

This matters because a business owner cannot do everything himself as the business grows. An important component of leading is to create an employee handbook that is written in an easily understood way, according to the SBA.  The handbook should include information about general guidelines, employee conduct, compensation and other legal information.

Small businesses need to adapt to the changing environment and embrace new technology. Sustainability is an important component of that, as sustainability and green business are becoming issues that consumers are concerned about. Businesses that take a proactive approach in committing to being environmentally friendly have a better chance to get good publicity and become consumer favorites, according to Green Business Case Studies conducted by the Small Business Association.

Choosing the best business location requires a lot of time and research.

“Take as much time and care in choosing a business site as in choosing a home,” Starting Your Business in Illinois by the Illinois Entrepreneurship Network.

“I moved to the Champaign location from my Urbana location because it was a better fit for my business,” Sarah Compratt, the owner of Fleurish, a flower shop located in downtown Champaign, said.  “Although I loved my old space, the new location has more visibility and action and is a proper flower shop with lots of cooler and workspace.”

To be successful, businesses want and need good publicity. The more the business’s name is out there, the more familiar and aware people will become with it, said Sinow.

“Be passionate and enthusiastic about your business,” Sinow said.

Michelle’s Bridal Shoppe in Urbana has been able to expand its shop during this time of economic hardship. Now, there are four different sections in the store: the bridal section that includes bridesmaids and mothers, the homecoming, pageant and prom section called M2, the formalwear section and the tuxedo and suit section.

“Weddings are so special, and people are still getting married,” Morgan Stone, the bridal team leader and one of the bridal stylists at Michelle’s Bridal Shoppe, said. “We invested in a lower priced bridal line, so that has helped us increase our sales over the years. We did that to accommodate to ours brides that may have lower budgets.”

Something else Michelle’s Bridal Shoppe has done to attract more customers is to implement different promotions, such as its bridal champagne appointments. With this, brides set up a time to have the space reserved specifically for them instead of coming at a time when the bridal shop might be crowded.

“We wanted to make something special for brides that have bigger groups that want to come with them to pick our a dress or for brides that just want more individual attention,” Stone said. “Our business is still growing, so we are remodeling again in December to add two more bridal rooms.”

Increasing the odds of getting a loan

It is never easy to access capital from a financial institution or investors,” Sinow said. “But, there are some factors that can put the odds in your favor for securing capital.”

The business plan must be very thorough and must make sense. Business plans that do not mention the marketing, promotion or distribution strategies are not convincing and will hurt the chances of getting a loan, Cayenne Consulting.

Business owners can make the business plan themselves, hire a professional to help or use computer software programs to ensure they make a well-thought out business plan.

For a loan from a bank, be willing to sign personally.

According to Sinow, the banks think, “Why should I loan you my money or invest in your business if you aren’t willing to risk your money and capital?”

Business owners should know more about their business than their competition does and “develop a sustainable compelling value proposition” about why customers will want to do business with you, Sinow said.

The Regional Planning Commission has implemented a variety of federal stimulus programs in Champaign County. Not all of the stimulus programs have gone to small businesses. Some programs have been directed towards government and citizens.

The American Recovery and Reinvestment Act of 2009 passed to increase jobs and promote the economy. In 2012, $840 billion dollars are to be invested in the economy, The Recovery Act. The Small Business Administration in Illinois has received nearly $2 million. However, all of this money was given to businesses around Chicago, according Recipient Projects, a government website.

“ARRA increased the amount of money available for our local loan programs, and we put almost $1 million in additional stimulus funding into the community in the form of business loans,” Moore said.

“I did not use a small business loan,” Compratt said. “I had personal savings that I used.”

It doesn’t matter if the business owners need to take out a loan right away to get started or later when they wants to expand. Successful business strategies are important to own and run a successful business.