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Tasks & Responsibilities of a Small Business Owner

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An all-rounder – that is how a small business owner can be described in proper perspective. Whether you are the tech-savvy owner of a software company or have a neighbourhood retail store, its task is diverse and varies as per the business stage.

The entrepreneur (owner), as the principal stakeholder, has to wear several hats while managing the business. To be successful, the owner needs to continually adapt and adjust to change demands and pursue matching business strategies.  We look at some of the tasks and responsibilities of a business owner in this article.

The type of product (or service) and several other factors influence tasks' priorities; if you seek the best small business advice, the following essential responsibilities will get identified.

Essential responsibilities of a small business owner

1. Managing finance

Whether at the conceptual stage or in operation, a business owner's primary concern is managing finance. From finding the investment money to organising the working capital, the owner has to give undiluted attention to the most crucial resource for a business, finance.

2. Account keeping (financial records)

The effectiveness of financial management depends a great deal on proper records. Experience says that small business owners often slip in this area; if you look for small business tips, the suggestion would be for using digital accounting software,  the ideal solution for account keeping. This software makes the job easy and provides ready, updated records for review and analysis.

3. Financial analysis and planning

Financial analysis is a necessary health-check plan for a  business. The owner must keep a constant watch on the company's money matters and tackle negative cash flow issues or under-recovery of cost on priority to prevent long–term impact on the company.

Several permits and licenses (depending upon the business's nature and location) are required; tax and other compliances have to be followed. Legal issues may also crop up at times.

The owner, as the responsible person, has to handle such matters to facilitate the business needs.

5. The product

The product (or service) is the reason for the existence of any business. It is the owner's job to closely monitor its entire journey cycle until it reaches the customer. Delivering a better value than competitors should be the principal product strategy.

6. Marketing and Sales

As an entrepreneur, you have developed intelligent accounting software or just started the romantic boutique cafe on the riverfront; but where are your customers?

The role of marketing begins right at the inception stage of your business. It (marketing) is the process that allows you to identify and connect with your prospective clients; it helps you in developing your identity (brand), increases your reach, and improves your business.

For the small business owner, marketing, both offline and online, provides the opportunity to stay ahead of the competition and fulfil your business goals.

The only requirement is a constant focus on the customer, product, quality, feedback, and communication strategy.

Following these essential tips for small businesses will help the brand get closer to building its customers' trust.

7. Customer Service

Customer service can be the differentiator between competitive products. The meaning of service in the present day extends beyond the product and is much more than addressing its queries.

The concept of service or support is an integral part of the communication a brand makes to a customer.

Brand selection earlier happened based on price or quality, but today, the overall customer experience (product + buying experience + price + service + perception) is more important.  Therefore, for the entrepreneur, monitoring promotion becomes significant as it will impact customer behaviour.

8. Employees

Investing in employees needs to be done carefully; the owner should be clear on the job description (of a position) and hire people with matching skills.

Irrespective of the number of staff, the owner must drive healthy work culture. The team should be clear about their role and, more importantly, the enterprise's mission,  goal, and objectives.

9. Planning and Strategy

A well-scripted and smoothly executed strategy is the key to achieve the planned goals.  It is important to remember that the marketing scenario is highly competitive and undergoes changes rapidly. The owner needs to follow a flexible and adaptive approach that can lead the business to success; repeated wrong decisions can turn fatal for a small business with limited resources.

Tips for small business

We have already analysed the main tasks of a business owner- let us now look at some of the specific actions as part of the tasks that may act as health indicators( of the business).

1. Analysing performance

The company must have a system of tracking key performance parameters regularly (fortnightly or monthly).  Relying on statutory reports like the annual report can often lead to delayed action since such statements usually lag for several months.

The business owner must ensure regular monitoring of data, and if required, may source external expert advice.

2. Adequate financial controls

Suitable checks and balances should identify areas of loss / potential loss. The actual objective of all controls is to prevent losses, particularly cash loss.

3. Cost structure

Businesses having a higher cost structure than competitors face a significant disadvantage in the pricing of their products.  Reviews should be part of operational analysis.

4. Working capital management

Continuous monitoring of debtors, raw material / finished goods stock, creditors, and the cash balance is necessary for a balanced fund flow.

If debtors and stocks increase beyond the planned level, the business owner should take immediate corrective actions.  ( one can consider short-term measures like price discounts, incentives both on sales, and recoveries of debts).

5. Large volume orders

Sometimes, the fear of losing a business forces owners to quote a price without the total cost’s detailed working. The order may ultimately come, but the entire industry may get off-balance due to underpricing. The owner of any company must avoid such situations.

Skills a business owner may need

A small business's success depends on the owner's leadership,  whether managing financial resources or executing the operational strategy, increasing the brand value, or ensuring that its customers stay happy.

What are the knowledge skills, besides leadership, that may help a business owner to manage the company better?  Here are some of them:

  • Communication
  • Negotiation
  • Team building
  • Financial
  • Planning

The final word

In conclusion, let us direct our attention to some astute business tips from experts – keep your focus on profit and cash generation, the two fundamental business objectives. And never compromise on the product quality.

It is said that passion and creativity drive an individual to set up a business. Still, the hardship and sacrifice will help the entrepreneur sail through the competitive industry's choppy waters.  This article will achieve its goal if some of the business tips for small business owners are useful.

Also Read:

1) What Businesses Can One Start Without a Shop?
2) How to Start a Balloon Decorator Business?
3) How to Start a Fertiliser Wholesale Business?
4) OkCredit: Simple, Paperless & Secure solution for businesses

FAQs

Q. As a small business owner, it may not always be possible to handle all management areas.  Appointing senior staff will cost high and upset the finances. What is the way out?

Ans. Use technology to ease your burden- you can install software for operational, account, and staff (attendance, payroll).  Several tech firms are selling a host of products; choose the best-suited one. You can source them both online or offline from a store.

OkCredit is a reliable company in this field with a large customer base.

Q. Does one need to study any specific academic course for starting a business?

Ans. You do not need any special qualifications for starting a business. Your passion, commitment, your organising capability, and ability to do hard work are the requirements.

Q. If my company faces cash problems after several years in business, what is the solution?

Ans. Analysing the situation is crucial – find out the causes; if it is due to unusual reasons, try additional borrowing to tide over. If the source of the problem is operational reasons, you should take necessary corrective measures on priority.