Afrinection guest blogger Nikki Viljoen discusses common mistakes made by small business owners. Read more below.

I had the opportunity to speak with one of my client’s this week, whose eyes became like saucers when I expanded on things that she could introduce and do within her business that she hadn’t even thought about.  A bit sad that, because she had the idea, the basic idea – but she was so caught up in that basic idea that she couldn’t see the wood for trees – there were several different additional dimensions that she could also go to, but hadn’t.  She was being restrained by herself.  Don’t be scared to dream big!

One of the other things that I often see small business owners and entrepreneurs doing wrong, including myself, is the old 80:20 rule.  It’s not new, it’s not difficult and it certainly is one of the most basic rules that we should all know and yet I for one, often struggle with it badly.  I think that one of the reasons for this is that I am so ‘caught’ up in the moment that I don’t see it coming or that I am in the middle of it and it’s only when I am just about strangled to death by it, that I see what’s happening and then take the necessary steps to stop it and usually by that time, it has already caused the damage and I have to start again.  

Let me step back for a moment and explain what I mean.

When 80% of your sales or your income, is generated from 20% of your customers – your natural instinct is to spend the greater amount of your time with those particular customers.  The problem with this of course, is that because you are getting most of your income from these customers you are often coerced into giving them bigger discounts or freebies and that means that your margins are cut.  The bottom line is that you may be getting the lion’s share of the turnover from them, but you are also getting the least profitability from them.  There is also the very real danger that should you lose, even one of these customers, you have lost a very big piece of your income and that is never a good thing.

Balancing the 80% with the 20% is a very delicate thing and if you get it right your business with soar to incredible heights, but getting it wrong could also lead to your downfall.  It is something that needs to be kept in sight at all times.

Linking to the 80%/20% spilt is customer service.  If your 80% clients are running you ragged with all of their demands, and believe me some of those bigger clients can have a very lopsided view of what their money buys from you, chances are that you may very well have both little time or energy left for your smaller clients and their perception then is that they are not getting good customer service from you.

I don’t care if I go into a shop every single day or once a year – I want good service.  If that is how I think, then surely my clients are entitled to the same.  Giving consistently good service to ALL of your clients will result in loyalty.  Loyalty in a client means that not only will they come back time and time again, they will also recommend you to all of their friends and word of mouth referrals are the best kind of marketing you can have.  Believe me too though, when I tell you it is also the worst type of marketing you can have, if you have upset a client.  Remember that ‘bad’ news also travels faster than ‘good’ news does and it has a bigger impact.  So be sure to give consistently good service to your clients.  

This of course, does not mean that you have to become a doormat for nasty and bad clients – those you should just get rid of anyway.  Give value for money and good service and you’ll always have business coming your way.

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About the author: Nikki Viljoen is a guest blogger for Afrinection and is the founder of Viljoen Consulting. Her website is  www.viljoenconsulting.co.za and she can be reached on Twitter and Facebook.