Small is beautiful - What makes a great micro business?
Are you a small business or a micro business? And why does it really matter?
According to the Office of National Statistics and the EU, the definition of a micro business is one with 0-9 employees with a turnover of less than £2 million, so when we talk about small business, we are in fact mostly talking about micro businesses. Amazingly 76% of UK businesses fit in to this category and make the greatest contribution to the economy.
While this sounds great, the problem is that micro business currently has no voice and is often cut out of funding streams, training and support and tax breaks which are only available to small businesses (10-20 employees; turnover of up to £10 million) and larger enterprises so growing a sustainable micro business can be hard.
I’m on a mission to address these issues at policy level and have set up a weekly Twitter chat @MicroBiz_Hour every Tuesday 7-8pm to bring micro business owners together to talk about the changes that would make their lives easier, and to meet the influencers that could make that happen. (To join the conversation use #MicroBiz_Hour)
I also want to show the world how great small enterprises are, and why they are so important to the economy.
For me there are 3 things that make a micro business great:
“Do One Thing Well” – micro businesses are brilliant at finding solutions to problems faced by a particular group and solving that problem by being an expert in what they do, rather than trying to be all things to all people.
Building an authentic brand that tells customers how you solve that problem for them - a good effective brand builds an emotional connection with your customer that makes it easy for them to make informed decisions about what products and services work best for them. [Here's a blog I wrote about branding]
People before profit – Good micro businesses always put customers, employees (if they have any) and collaborators first. Profit is important, but people should be at the heart of your business.
It’s simple, but these three qualities are a solid foundation on which to build your micro business, or any business!
To demonstrate what I mean I want to introduce you to micro business owner David Hunt of DCR Wheels. David runs a fantastic small enterprise that specialises in building bespoke bicycle wheels.
I knew I wanted to speak to David after a chat I had with my lovely friend Chloe. Chloe is one of David’s wheel builders and was telling me how much she looks forward to going to work because everyone is so friendly and helpful, and how valued she feels. She said David had even invested in a coffee machine for the staff just because he thought it would make them happy!
This sounded like all the qualities of a great micro business so I went down to meet David and the team and find out more:
The DCR Wheels team
No. 1. “Do One Thing Well”
Marisa: So why “hand-built” wheels, for people that don’t know the difference.
David: Well, they are specific to the person’s needs in a way that shop-bought wheels may not be. Because we just hold the component parts of a wheel we can provide many different combinations, and we don’t need to hold a lot of stock.
M: So it’s a good business model then?
D: Yes definitely. We only need to stock the components that make up the different combinations.
M: I saw that you put a lifetime warranty on your wheels. That’s pretty amazing customer service. How does such a small business manage to do that?
D: Yes that’s for the build and the spokes. We can always service every wheel we have ever made because of the relationship we have with our suppliers and the quality of their components.
M: Fantastic. What I like about your company is that you are specialising in one part of the bike, so you are complete experts in just one thing.
D: Absolutely. Our major investment over the years has been the specialist tools and machines we have that are essential to building high quality bike wheels, and that’s it.
DCR Wheels logo
No. 2. Authentic branding
M: It’s obvious that people really like what you do. What is it about the brand that people connect with?
D: I think our brand is quite low-key and funnily enough the logo was designed by a company who liked us, so we did a skills exchange.
M: How brilliant! It’s a really effective logo.
D: Thanks. I like the fact that it’s quite playful. We don’t take ourselves too seriously and the branding really reflects that. But we’ve also been very much focused on service and knowledge being the cornerstone of the business rather than flashy branding. So for example we have our own branded products but we don’t plaster them with our logo so it’s quite understated and allows the products to speak for themselves.
M: And I think that is especially important because you are in such a heavily branded industry.
D: That’s right, and actually there is now quite a backlash against that.
M: Yes, I see quite a lot of style over substance in the cycling industry.
D: We don’t want people to be a walking advertisement for what we do. We would prefer that they like us because of the quality of work we do and the service we provide.
M: So I guess what you’re saying is that your brand is consistent with a quiet confidence about what you do.
D: I like to think so.
No. 3. Putting people first
M: So Dave the reason I am here is because of a conversation with Chloe about how valued she feels as part of the team at DCR. You have obviously created a really positive work environment. What do you think is the secret to creating a happy work force?
[At this point, while Dave was considering his answer, Chloe dropped in to the workshop and started telling me how she felt about her experience of working at DCR]
Chloe: I think it’s the little things that make a big difference. Because I like coffee it’s nice to know I can come to work and have a nice coffee – it’s a small thing, but it makes a difference to my working day.
Also Dave really understands that we all have our own lives, which he sees as a good thing, rather than a burden, unlike other places I have worked. As a working mum I’m not made to feel guilty if my son isn’t well and I have to leave early or something like that.
M: So David it seems your work is done as your workforce are speaking for you!
D: I guess the way I see it is that when I’ve worked elsewhere, what I earned varied, but my job satisfaction didn’t come from the money. I used to feel frustrated because I felt the employer could have done a lot more for my well-being which didn’t have a cost attached, and even if they had of doubled my salary, I wouldn’t have felt more job satisfaction.
As a small business I can’t afford to double someone’s salary, but for example I can ensure that Chloe has the flexibility to leave early if she needs to.
M: So your approach is based on mutual respect.
D: Absolutely. So if someone has a need we try and find a solution together. Listening is really important.
C: I was going to say that you do really listen. You know, the things we bring up might be quite simple and you will implement them quite quickly in a way that another company would let things linger on. It’s just done and it isn’t a problem.
M: And in fact David the cost to your business is less because you haven’t got a high turnover of staff.
D: Exactly. So for me where wellbeing is high, productivity is high as well. Also, I can’t have all the ideas. I need these guys to tell me if there is something we can improve on. So I feel like companies that ignore the observations of their staff are unlikely to do as well as they could for their workforce or indeed their customers.
M: Well, they clearly have a lot to learn from you. Thanks for your time David and Chloe.
So there you have it. Follow these 3 steps and you will be well on your way to becoming a great micro business.
If you would like some support with your business, micro, small or any size then book a 30 minute phone call here and find out how coaching and mentoring can help you and your business.
Marisa Guthrie Top 100 Business Coach Blog 2017