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A weekly look at Wyoming business questions from the Wyoming Small Business Development Center (WSBDC), part of WyomingEntrepreneur.Biz, a collection of business assistance programs at the University of Wyoming.
By Matt Varilek, Wyoming Small Business Administration Region VIII administrator
“How do I set my business up for success during the holidays?” Emily, Fremont County
We all know that the holiday season can mean a huge jump in sales for small businesses.
The Small Business Administration surveyed several business counselors to compile this list of the top six hurdles small retailers face:
-- Lack of inventory control. It is important to remember that inventory equals profits and knowing how much product and when to order it. What items to order also can make the difference between having cash in the bank and having aging inventory on the shelves.
-- Hiring the wrong employees for critical positions. Small firms tend to have fewer layers of management between the owner and the employees. New hires must be able to perform with less direct supervision and be motivated to get the job done right the first time.
-- Undercapitalization is a lump of coal no business wants or needs. Cash flow is the lifeblood of small businesses. Cash flow allows a business to make payroll, pay suppliers and keep its doors open. Business owners can immediately increase cash flow by collecting accounts receivables in a timely manner; not keeping too much cash tied up in unnecessary inventory; and eliminating unprofitable account relationships.
-- Not embracing online sales and social media. A recent U.S. Census Bureau report shows that more than $75 billion in e-commerce sales were made during the second quarter of 2014 -- a 5 percent increase over the previous quarter. As more consumers make holiday purchases using the Internet, it is imperative that small retailers develop a retail Web presence. Leverage Twitter and Facebook to promote one-day sales or plug special product lines.
-- Not delaying the employee office party and social events. Office parties can cause distractions at a time when the business needs to be especially productive. Too much food and drink can not only cause a nasty hangover, but sidetrack employee and management’s focus. Consider moving the company party until after the New Year’s Day holiday and call it the annual thank-you event.
-- Innovation and creativity lost. Locally owned small retailers beat their big-box competitors by providing outstanding individualized customer service. Small retailers should take the offensive by selling creative and innovative products that cannot be found at the local mega mall.
A blog version of this article and an opportunity to post comments are available at http://wyen.biz/blog1/.
The WSBDC is a partnership of the U.S. Small Business Administration, the Wyoming Business Council and the University of Wyoming. To ask a question, call 1-800-348-5194, email email@example.com or write 1000 E. University Ave., Dept. 3922, Laramie, WY, 82071-3922.