12 rules for microenterprise success (part 2)
Sorry for the delay, guys. Here is the second installment of the 12 Rules for Microenterprise Success that the Academy of Creating Enterprise (based in Cebu City) teaches its students. I find that these principles are short and sweet and very much adapted to the Filipino setting (like “Don’t “eat” your inventory”). Students of ACE know these by heart; they memorize them and have a little pamphlet of this in their wallets.
If you are interested in part 1, click on this link.
7. Keep good records
One of the important ways to grow a business is to keep simple records. A small business should keep track of five things everyday: cash-on-hand, money you owe, the amount people owe you, sales for the day and the value of your inventory.
“Winners keep track of results, losers keep track of excuses.”
8. Increase sales, decrease costs
Smart business owners work hard to increase sales, while carefully watching costs. This requires keeping records so you can track sales and understand costs. Some don’t want to offend customers by being pushy or negotiating with suppliers—better to offend than to starve.
“Lots of people confuse bad management with destiny.”
9. Make a profit every day.
Ask a business owner if he made a profit today and you might be faced with a blank stare. The goal in business is to make a profit everyday—to do that you must buy right, add value, and do correct pricing. Suggestive selling as a way to increase the size of each sale and leads to increased profits.
“Winning is a habit, just like losing.”
10. Value your customers.
For many businesses, the most valuable asset they have is their customers. If you can build up a group of loyal and repeat customers, then you can count on that much repeat income. You then must concentrate on keeping them happy, plus attracting new ones.
“The purpose of an enterprise is to create and keep customers.”
11. Pay yourself a livable salary.
One of the biggest reasons small microenterprise owners fail is they take some of their working capital out of their business almost daily, depending on personal needs, without keeping records. This is not good! We suggest that each owner takes a specific amount out each day or week as salary.
“We can’t change the results without changing the behavior.”
12. Don’t “eat” your inventory.
Eating, giving away or letting others “borrow” your inventory are all ways to lose money and therefore could cost you or your business. Not selling perishable items fast enough is also a way of “eating” your inventory. Never let anyone take inventory without paying.
“Poverty needs no plan. Success requires one.”
To read part I just click: 12 rules for microenterprise success (part 1)