I’ve worked in the manufacturing and engineering sector for more than 30 years, and I’ve been my own boss for two decades of this. I’m now Director of two Derbyshire businesses: engineering sourcing firm Synergetix and manufacturing software company Statii, which look to improve profitability and productivity for SMEs in the engineering and manufacturing sector. But it’s not always been smooth sailing…
When you first start out in business, a cool head for figures, a passion for your product, and an ability to take well-judged risks can carry you a long way. So will choosing the right people to work with and making sure you deliver on ALL your promises – to customers, suppliers and staff.
But everyone makes mistakes. Sometimes, it’s the little things that will trip you up, sometimes there will be circumstances beyond your control that affect that all-important bottom line. It may be a competitor coming in from abroad out of the blue, or a dip in the global marketplace you could not have foreseen.
While it is true that we all make errors, the vital thing is to learn from them and not fall into the same pitfalls twice. When you’re starting out, just learn, learn, learn, from the marketplace, from your staff, and from those business people you admire and who have more experience than you.
With that in mind, having started my first business at 18 and been involved in the manufacturing industry since the late 1980s, here are some of my insights from owning and running SMEs.
Be firm but fair
Vital in any kind of leadership role, whether your business is just you and a friend, or whether you’ve got a large premises full of staff and a thick order book, is to make clear, well thought through decisions and stick to them. Nothing will undermine confidence in your brand more than indecision. Your staff will pick up on it at once, and your customers too. Have clear policies relevant to your business – whether it’s returning faulty goods or apologising for mistakes – and don’t veer from them. The same goes for staff. If someone turns up late every day, you need to find a way of making clear that will not be accepted.
When making any decision, consider how it will be perceived by your customers
Your customers ARE your business. Without them, you are nothing. Whenever you make any decisions, from the colour of your branding to changing your stockists, put yourself outside the window of your business and imagine how it looks from the point of view of the customer looking in. If it doesn’t look good, don’t do it.
Go the extra mile – it’s never crowded up there
Adopting a “that’ll do” attitude is NEVER a good way to do business. Cutting corners and being slipshod is always a bad idea. You will be found out, and all the hard work you’ve put in towards building up a great product will go to waste. There’s always room to go the extra mile for your customers, and trust me, it’s worth it.
Companies like John Lewis are famous for it and with good reason, giving your staff as much “buy-in” as possible to your business will reap huge rewards when it comes to loyalty and productivity. Think carefully about how you do this, whether it’s creating open forums where important decisions are made about the direction of the business, or offering shares, or holding blue sky meetings where new ideas can be brainstormed by everyone in the office from the bottom up.
Don’t go chasing turnover unless it meets your pre-determined profit targets
Many a business, both large and small, has fallen foul of this important maxim. It is very exciting for a young start-up firm to win big deals, but you need to look carefully at the financials before going for those contracts. If they’re going to cost you more in manpower and parts to fulfil than you’ll make in profit, they’re not worth having. You’re better off with smaller deals that won’t cost you so much to complete. Customers won’t be impressed with your big name clients when losing one of them puts you out of business because you haven’t paid enough attention to the profit line.
All businesses have competitors, but you’ll never succeed if you spend your whole time playing catch-up. Yes, keep a close eye on what other companies are doing in your marketplace, but don’t follow them. Be the first with new ideas, or, if you’re copying an existing idea, find ways to do it better. It’s far better to succeed on differential than on price.