Small and medium-sized enterprises must understand the principle of "less is more"

At present, my country's small and medium-sized enterprises are facing endless operating difficulties, such as the decline in the export market of export-oriented small and medium-sized enterprises caused by the deterioration of the external environment, the general rise in raw material prices, the financing costs are generally higher than that of large enterprises, and the sales situation is difficult to open up. , labor costs have been rising year after year and other issues. Profit margins are squeezed by the above-mentioned multiple factors, resulting in the danger of the survival space of small and medium-sized enterprises being compressed at all times. To this end, the country has successively introduced many policies to provide relief and benefit to enterprises, support small and medium-sized enterprises, and strive to improve survival rates and market competitiveness.

As operators of small and medium-sized enterprises, while enjoying the preferential and encouraging policies provided by the state, they also need to adopt effective business strategies based on their own actual conditions. I believe that the main characteristics of small and medium-sized enterprises are their small scale, weak ability to resist risks, and difficulty in forming core competitiveness. Faced with this actual situation, small and medium-sized enterprise operators need to understand the principle of "less is more" and integrate it into their daily operations.

"Less is more" in business categories

Under normal circumstances (it cannot be generalized), the more categories operated by small and medium-sized enterprises are not better, but less is better. Less is better. Only then will it be easier to make high-quality products, and only then will it be easier to occupy niche markets, and based on this, expand into related fields. Shi Yuzhu also mentioned when talking about his experience in running a business: "If there is one less product, then one less."

To achieve "less is more" in business categories, to put it bluntly, it is to build yourself hot products. Many marketers propose to create one or two popular products to attract traffic, and then launch one or two products that can actually generate profits to create cash cows. There is certainly truth to this statement. In my opinion, forming your own popular products is the first and key point. With hot hits, there is a foundation, and all dreams are possible.

Here, I will take as an example a tax service agency that everyone easily encounters when running a business on a daily basis. Generally speaking, tax service agencies can provide consulting or assurance services for all tax issues of their clients. In other words, tax service agencies do not choose customers or fields. Such tax service agencies abound, and it is difficult to make them unique and have strengths. A tax service agency I know has taken a different approach and chosen one of the many types of taxes, land value-added tax, as its main focus. It has built the land value-added tax settlement service that real estate companies value most and needs most as its flagship product. The product focuses on At the same time, customers are also focused. After many years of hard work, the income brought by this service product alone has outperformed more than 80 tax service agencies on the market.

"Less is more" in capital investment

At first glance, less is more in capital investment, how is it possible! In fact, I am not saying that capital investment can be reduced without principle, thinking that less is better, but through the scope and standards of actuarial capital input and use, the company can operate normally as quickly as possible at the minimum cost, and hematopoiesis can be formed through operating cash inflow. Function, balances cash inflows and outflows, thereby generating a cash surplus.

For example, for the purchase of large fixed assets (whether it is large or not, different companies need to judge according to their own circumstances), you can reduce the original capital investment through leasing, and use operating cash inflow to pay for subsequent purchases. Expenditure on the use of fixed assets to minimize capital investment.

Employers must be capable, less is more

In terms of employment, key positions and key departments require smart and capable talents. Other non-key position functions can be completely purchased through procurement. service method to solve. There are now so many outsourced service organizations, and the procurement cost is much less than hiring employees independently. Moreover, companies also avoid many legal risks in employment.

Many technology companies use this aspect a lot. In many companies' technical departments, only a few key positions are recruited through independent recruitment, and all other non-key developers in the department purchase services provided by others through outsourcing.

In this way, costs such as wages and social security are reduced, and the pressure on company management and legal risks are reduced.

Concentrate on R&D, less is more

This has two meanings. First, if small and medium-sized enterprises want to gain core competitiveness and long-term development capabilities, they need to invest capital and Personnel investment should be tilted towards R&D, and efforts should be concentrated on R&D; second, do not attack on all sides, do not do more, the better, and invest limited resources into projects that are more likely to succeed and are expected to produce more economic benefits. In comparison, the latter is more important. If an enterprise wants to develop in the long term, it needs to seek truth from facts and not be too ambitious. There may be some R&D projects that are of great importance and may have good future economic benefits, but the investment is large, the R&D cycle is long, and the probability of success is small (at least for now). Such R&D projects cannot be regarded as current key projects (over time, these projects will become key projects as the company grows and develops).

The essence of "less is more" is to focus on the goal

All behaviors and energy of successful entrepreneurs are closely centered around the established goals of the enterprise. Success lies in focus. Target. The essence of the idea of ??"less is more" is to focus on the goal. It means you get rid of all (yes, all) things you can do but don’t have to do, and focus on what you should be doing.

Focusing on goals is the only way to achieve excellence. If small and medium-sized enterprise operators can narrow their goals as much as possible, understand the essence of "less is more" and focus on one place, they will definitely succeed.