How to Manage a Small Business

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To manage a small business, know the difference between profit and cash flow, create simple and effective marketing, and keep employees and customers motivated. Run a small business more efficiently than a larger business with information from a business management consultant in this free video on small business.

Part of the Video Series: Business & Leadership
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Video Transcript

I'm here to talk to you today about how to you today about how to manage your small business. Now I've run a small business called Human Dynamics for fifteen years, and over that time the same things come up over and over again. If you're to be in a small business, then you really have to be more nimble, more efficient than perhaps big businesses that have the luxury of plenty of resources to do some of the things you want to do in life. So you have to be quite choosy about where you spend your time, money, and other resources. But really, three things that you ought to pay attention, attention to in running a small business are looking after the money, looking after the marketing, and looking after the motivation of yourself and the people you work for because your costumers really need to be motivated as much as you and the staff that you manage do. Let's take those one by one. Now, money. It's really important to know the difference between profit and cash flow. Taken in an analogy, think about it, people say don't tell me how big your mortgage is, just tell me whether you can pay the gas bill. The same is really in business. You might have some fixed assets or other assets around, but if you can't actually pay the bills year on year, week on week, then you won't be able to continue on business. Smart managers understand the difference between profit and cash flow, and learn the basics of accounting so that they can actually stay solvent. Now, marketing is probably the next most important thing you're ever going to do. Marketing is not a mysterious science. It is about working out what it is that you do that's really unique, finding a way to convey that to other people in ways that they want and need to take notice of, and then finally getting them to say yes, and buy something from you, what ever it is you do. A really good idea is to actually find a way of explaining what your business does in simple terms, in no less than maybe thirty seconds, and to be able to do that verbally, on the web, in text, and perhaps visually, finding different media to explain your marketing message, couched in the way that costumers understand, not from your head. Finally, motivation. I don't just mean you, you've got to actually motivate other people, and that includes your costumers. In a sense, if you're going to continue as a small business, you have to be the motivator of your costumers to keep them coming back time after time, for more and more things. As well as that, of course, you've got to motivate your staff and keep yourself going. The best small businesses I've ever met are driven by people who really love what they do, there's no greater secret than that. So I think that's all I can say about, in this time about how to manage a small business. The three M's: money, marketing, and motivation.

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