Competing for talent with large companies is one of many challenges faced by small businesses, but new resources are available to meet those challenges, says Susan Cranston, Assistant Vice-President of Group Small Business Marketing and Advisor Services for Manulife Financial.
Canadians who operate small businesses for their livelihood face many challenges – finding access to capital, being strategic in their planning and learning to use new information technologies to reach customers and suppliers.
Small businesses that do not offer benefits plans may struggle to keep their employees, says Ms. Cranston. Larger companies may have an edge in recruiting and retaining employees because of the benefits programs they offer. But there are affordable solutions for small businesses that enable them to provide the benefits their employees seek, she says.
A health-care spending account offers choice to employees and is affordable for employers, Ms. Cranston says. “It’s a great way for a small business owner to manage costs around the benefits offering. Let’s say for every employee you’re going to put in a $300 health-care spending account. It gives employees flexibility but it caps the risk [to employers]”
Another option is group life insurance, for as few as two people, says Ms. Cranston. A group Retirement Savings Plan, an extended health program with drug, dental and orthodontic coverage and an employee assistance program [EAP]are other examples of benefits programs that small businesses can take advantage of.
EAPs offer “tremendous value” to small business owners in helping employees through divorce, financial problems or mental health issues, says Ms. Cranston. “They’re showing that they care about their employees. It’s about creating a branded culture, and that’s going to resonate in terms of how their people deal with their customers.
“If someone is going through a divorce or has run into financial problems, they may need help in order to perform well at work again. It takes the pressure off the employer because that’s not going to be their area of specialty, nor do they necessarily want to get into those details with their employee. And the employee would like to have access to a third-party professional who can help them deal with some of these issues.” As for the cost, “how can you afford not to, particularly if you’re looking to attract and retain talent?”
Small businesses need people “who can wear many hats. You can’t duplicate the people that you have working for you, and if they’re passionate and ambassadors of your brand, that’s the true competitive edge,” says Ms. Cranston.
Small business owners are a major force in the Canadian economy. There are over one million small businesses in Canada with employees, and on average, 130,000 new businesses start up each year. One in three Canadians are interested in starting their own business in the next two years, and approximately 35 per cent of this group plan to follow through on their plans, according to a survey conducted for Intuit Inc. by Angus Reid.
Increasingly, small businesses have options available to them to meet their challenges, says Ms. Cranston.
Finding access to capital is a chronic challenge for small business. Making a successful pitch to investors requires a well-crafted business plan, and there are tools available on the Internet or through financial services companies to help, she says. Having a strong support network, or what Ms. Cranston refers to as an “entourage,” also helps.
“We think about that in terms of movie stars – their agent, their stylist, their PR person. I think small business people need that as well. It doesn’t have to be costly. They need people they can rely on because they can’t be experts in human resources, in financial planning, in thinking about the long-term viability of their business strategy.”
Thinking about the big picture and planning for growth when preoccupied with the day-to-day struggles and surviving the ups and downs of the economy is a challenge for small business owners.
“They’re totally absorbed in the day to day. I think they lose a lot of energy,” she says.
Another challenge for small companies is to derive the benefits of new information technologies. These new technologies and social-media networks can help them connect with customers and suppliers, at a low cost.
“The web’s cheap,” says Ms. Cranston. “You can hire someone to build a website for you,” or use online tools such as Weebly to create one for free. “Social media is free, in many cases, whether that’s Facebook or Twitter, or LinkedIn. It’s a great way to cost-effectively promote your business,” for an hour or two a week spent developing an e-strategy.