The downfall of productivity and profitability in ...

The downfall of productivity and profitability in a small business

It’s a truly wonderful thing to be able to go into business for yourself. The ability to eschew the rat race and a corporate culture and economic climate that seems to be actively working to hold you back, put you in your place and place boundaries and restrictions upon your potential. When you take the jump and wave a cheerful goodbye to wage slavery it can feel as though you’re flying. Yet, like Icarus, small business owners risk flying too close to the sun… But unlike Icarus, they know it. They know that historically the odds are not in their favor, with small businesses failing at a rate of 50% in their first 5 years. In order to stay afloat it’s not simply enough to be the best, they must operate in a constant state of vigilance.

The deck is stacked against small businesses and the risks to their productivity and profitability are legion. As an entrepreneur, it’s your responsibility to be proactive when it comes to guarding against the threats that your small business faces on a daily basis. Your very survival depends on it!

Poor morale

Morale (both yours and that of your employees) is the lynchpin of your workplace culture. It’s a well established fact that higher employee morale leads to increased productivity and happier, more motivated employees. And guess what? When your employees are happy, they smile. And when they smile, those smiles are infectious. You’ll see them on the faces of your customers and even those prospective leads who just thought they’d swing by to get a look at what you’re all about. Poor morale can sap the energy from your workforce and make the already difficult life of an entrepreneur absolutely arduous. And you’d better believe that your customers will pick up on the negative atmosphere.

Thus, it’s up to you to take steps to boost employee morale. Ensure that your workers are well trained, well supported and well remunerated. Keep them cohesive by using incentives schemes that encourage teamwork rather than grasping self interest. Instigate an open door policy to show your employees that you always have time for them and put an infrastructure in place that gives them a voice. Whether it’s an open forum on your intranet or just a suggestion box, your employees deserve a platform!

Unexpected down time

There’s nothing more ruinous than unexpected downtime for your systems or equipment. It can slow productivity to a crawl, lead to agitated and frustrated employees and, of course, cause you to renege on promises you’ve made to customers and clients. While it can be hard to pre-empt everything that could result in unexpected downtime there are some steps that you can take. Invest in a diesel generator to ensure that your operation will never be brought to a standstill by power loss. Outsource your IT provision to a respected third party to ensure that IT downtime is resolved quickly and to your satisfaction. And, of course, make sure that you have the healthy cash flow to ensure that your bills are paid on time.


There’s no need to fear your competitors. In fact you should embrace them. Not literally. Or maybe literally. While competitors can be your undoing and undermine your profitability, they can only do this if you take your eyes off them. That’s why competitor analysis isn’t something which you can only address at the point of startup. It needs to be an intrinsic part of your operations. Keep a close eye on what they’re doing and look for opportunities to do it better. Find out why they’re scoring higher than you on search engine rankings and adjust your SEO accordingly. When you keep a close eye on your competitors you’re much better positioned to limit the damage that they can do to your business.

Poor branding

If you think that branding starts and ends with the pretty logo on the header of your website or the clever slogan attached to it, this is a fundamental mistake which could not only make your brand less appealing to customers but also compromise your employees’ personal investment in your enterprise. Your brand should be a promise to your customers and a banner behind which your employees can rally. It should have an ethos and a set of standards behind it that are intrinsically tied to your mission statement. It should influence everything from your employee training to your blog posts. It should be consistent and cohesive across all platforms and create positive associations among your workforce and your clientele.

If you can keep a constant eye on these threats, you can steer your business into a healthy, happy and prosperous future.

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