Growth / Planning & Strategy

Grow your small business on a budget: a survivalist guide

Bamidele Onibalusi

Oct 12, 2020 · 6 min read

Toolkit for download in this article

Grow your small business on a budget: a survivalist guide

Growing a small business without enough capital can be difficult, yet lack of capital or cash flow issues is one problem small businesses consistently cite as a barrier to growth.

In fact, according to the 2020 Small Business Trends report by Guidant Financial, based on a survey of over 3,100 small business owners, lack of capital has consistently been the most cited challenge by small business owners year in and year out. In particular, 32% of people report having issues with capital or cash flow.

So how do you grow your small business while operating on a budget? Here are some data-backed suggestions for you:

1. Use a CRM

According to data compiled by HelpScout, it costs 5 to 25 times more to acquire a new customer than it costs to keep a current customer and a simple 5% increase in customer retention rates can boost profits by as much as 95%.

In other words, maximizing the value of every single customer is much cheaper and helps you grow a lot faster as a small business.

Using a CRM solution is one of the best ways to maximize the value you get from your customers; pretty much every CRM solution keeps granular data about every user on your list including what stage they are at in their customer journey.

Advanced CRM solutions like Keap take things much further and allow you to automate contact and follow up with your leads using high-level personalization.

There is no ambiguity about the results that come from using a CRM. According to Nucleus Research, you can expect a ROI of $8.71 for every dollar spent when you use a CRM solution and data from Salesforce shows that using a CRM can boost sales by up to 29%, productivity by up to 34%, and accuracy in forecasting business outcomes/results by up to 40%.

2. Use email marketing

Email marketing has a ROI of about 4,200%. In other words, for every dollar spent on email marketing, you can expect to gain $42.

If your small business has yet to start using email marketing, it will be a good idea to start now. This is because an email list gives you an opportunity to reach out to the same set of people repeatedly, giving value and developing a relationship with them.

As a small business, there are several ways you can build an email list without having to spend money or by spending very little:

  • Partner with a blog or publication with a large audience and get them to tell their audience about your email list in exchange for access to your product/service.
  • Run a giveaway as a way to build your list -- Josh Earl was able to add almost 200,000 people to his email list in 11 days just by running a giveaway.
  • Make sure you have opt-in forms in every noticeable place on your website (sidebar, post footer, popup, etc.) to encourage people to join your email list. Buffer was able to increase its monthly email subscribers by 130% simply by adding sign up forms to more places.
  • Offer an incentive (could be an ebook, ecourse, a coupon, or some other incentive) that is especially conducive for attracting subscribers to your email list.
  • 3. Focus on the “little stuff” that affect user experience

    Oftentimes, small businesses tend to obsess over the complicated stuff and ignore the “little stuff” that can yield significant gains.

    Instead of worrying about how to get $10,000 to spend monthly on Google and Facebook ads, why not focus first on optimizing user experience on your website and potentially doubling or tripling your conversions without spending a dime?

    Some of the little stuff that can yield great gains include:

  • Your website speed: A one-second delay in load time can cost you 7% in conversions. Ensuring you have a faster website does not have to cost an arm and a leg: there are many cheap web hosts that are very fast, and it won’t cost you a dime to implement most website speed optimization hacks.
  • The mobile experience: There are many more mobile users than desktop users. Not optimizing for the mobile experience can automatically cost you more than half of your sales. If your small business website is not mobile-optimized, optimizing your website for mobile users can double your sales.
  • The customer experience: 51% of people will not do business with a company again after one negative experience. That’s more than half of your hard-earned customers. Improving customer support response times, over delivering on what you promised, and having a clear return policy can help enhance the customer experience and boost sales.
  • 4. Optimize the checkout process

    Shopping cart abandonment rate is currently 69.57% according to data from Baymard Institute. In other words, about 69.57% (or almost 3 out of 4) of people who visit your website, carefully go through your offer, and get to the checkout page, will decide not to buy.

    These aren’t just random visitors. They are people who have for some reason decided that they like what you’re offering and have gotten to your checkout page. Getting just half of these people to buy will more than double your sales.

    You can reduce cart abandonment rate and increase sales by optimizing your checkout process -- without necessarily having to spend a dime.

    Optimize your checkout process by:

  • Reducing the number of form fields users have to fill before completing the checkout process.
  • Integrate with third-party payment processors to enhance checkout and make potential customers trust you.
  • Integrate elements of trust on your checkout page -- this could be security trust seals, testimonials and social proof.
  • Have a clear return policy.
  • In conclusion

    It doesn’t necessarily have to cost you an arm and a leg to build a thriving, successful small business. You can grow a small business with little or no money, and many of the suggestions above will help you survive without requiring a lot of money from you.

    Bamidele Onibalusi is a freelance writer for hire and the founder and CEO of Effective Business Ideas. You can follow him on Twitter @youngprepro.


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