Tagged: tendency

Small business tendency

According to a new report of economic department of the RBC bank, representatives of small and medium-sized businesses in Canada experienced a recession with fewer losses than big business.

According to data of small and medium-sized enterprises compared with companies that size is over 300 people they do have less job cuts, the level of employment fell by 4.2 per cent, while for large businesses, the figure was 5.5 percent. “Countering concerns that smaller enterprises are generally more impacted by economic downturns, we found that smaller businesses endured the recent recession better than their larger counterparts,” said Paul Ferley, assistant chief economist, RBC. “The relative success of private sector SMEs likely reflected lower exposure to external markets such as the United States, which saw greater weakness compared to Canada’s domestic economy.”

Regional Findings:

Newfoundland & Labrador: Small and medium-sized enterprises employment declined by 1.2 per cent, (4.3 per cent at large firms). Small and medium-sized enterprises manufacturing declined by 29.2 per cent (90 per cent at large firms).
Nova Scotia: Large firms’ employment fared better than small and medium-sized enterprises – 1.7 per cent and 2.9 per cent respectively.
New Brunswick: Manufacturing sector falling by 11.3 per cent, however employment among of small and medium-sized enterprises contracted 13.2 per cent (9.6 per cent at large firms).
Quebec: Small and medium-sized enterprises employment declined by 2.6 per cent, (6.2 per cent at large firms).
Ontario: Small and medium-sized enterprises employment declined by 10.4 per cent, (19.2 per cent at large firms). In the retail and wholesale-trade sectors Large firms’ employment fared better than small and medium-sized enterprises 1.3 per cent and 4.1 per cent respectively.
Manitoba: Small and medium-sized enterprises employment declined by 1.5 per cent, (8.1 per cent at large firms).
Saskatchewan: Small and medium-sized enterprises employment increased by 1.8 per cent after initially falling 0.7 per cent, (8.1 per cent decline at large firms).
Alberta: Large firms’ employment fared better than small and medium-sized enterprises – 5.6 per cent and 7.4 per cent respectively.
British Columbia: Small and medium-sized enterprises employment declined by 6.9 per cent, (7.4 per cent at large firms).

Partnership with a big-shot: hope for the best, prepare for the worst.

Partnerships within the survival-of-the-strongest business world don’t always end with ‘happily ever after’.

Microsoft Corp. was spending millions to find a new method to help people conserve energy and count the energy usage for its Hohm line products. The company looked for utilities and devices that could help households track their energy use – the purpose being, if you can see how much energy you are consuming as you go, you will save energy by reducing the usage, thus saving you from a large energy bill at the end of the month.

When Blue Line Innovations Inc. heard about what Microsoft was trying to do, the next thing to do was obvious: pick up the phone and call them. The reason being, Blue Line Innovations just happened to be the owner of technology that fits perfectly into Hohm line project. Blue Line Innovations had worked on PowerCost Monitor for years, a device with a display screen that measures power usage in real time. So they had every reason to call Microsoft, and they did. Let there be partnership.

Both companies had what the other lacked: Blue Line Innovation wanted to make its interface more user-friendly and mostly, to be recognized and help consumers save money. Microsoft had wanted to find a device that does just what PowerCost Monitor does. With Blue Line’s technology and Microsoft’s vast amount of resources, Hohm line was completed.

The partnership between these two companies is very common among small firms. In many cases, the small businesses have the technology or intellectual property that the large firms need, yet the small ones lack resources and network that the large companies possess. By partnering up with a big-shot, small firm gains access to the market and commercializes its technology. In addition, small firms also get affiliation advantages from a large company: in-house expertise, knowledge in production process etc.

However, such partnerships between small and large firms often create disastrous results. Small companies must be aware of the potential downsides of partnering up with big-shots. One of the major issues is theft of intellectual property. Once you have shared the essence of your idea, the big brother might just part ways and say, ‘who are you again?’ Some may contend, ‘They can’t do that because its against the protection law.

They will get sued!’ Sure, the large companies will get sued but the small companies just don’t have enough financial support of their own to take the fight all the way or even start a fight. It is lose-lose situation for the little David and the Goliath walks away with a smile.

Luckily, there are things a small business can do to help itself and minimize the damage when the misfortune happens. First, when negotiating a partnership, avoid dealing with one person at the bigger firm because after that person is no longer in charge of the deal, small firms find themselves in trouble.

Also, try to diversify your sales route as much as possible. Having all your income from the partnership often leads to cash-flow problems because you often have to spend a lot of money to provide services for the big firm.

Most importantly, you should carefully assess whether the partnership is the right business opportunity. The name value of the big company often cloud the judgement you make, so have a mentor or an advisor who can guide you through the process and making decision.

Sometimes, it is best to sell the company, so that you have something in your hand when you get out.

In short, if a small company makes the decision to have a partnership with a larger one, it must make the call carefully. Once it is done, it would be best to learn from the experience and the period of the partnership. The larger firms often have creative, innovative ideas. It is wise to learn how the ideas are developed and carried out, for the experience could be something valuable that small firms need.

Network Through Sprouter

This new free social networking website is spreading fast and wide: already rooted in 170 countries, connecting entrepreneurs across the world.

Sprouter is a networking site designed for entrepreneurs, by Sarah Prevette who is the only Canadian to be on the list as Top 30 under 30 in North America – the list was put together by Inc. magazine. It was less than a year that Sprouter was introduced to web, but it is already embraced by entrepreneurs in 170 countries. That is impressive.

What has made this website so special and fast-growing? One of the many possible answers to that is in it unique setup that creates an atmosphere that is similar to a seminar rather than an informative website or Facebook.

Sprouter is a forum where entrepreneurs log on and ask questions and state challenges they are facing which is followed by the answers from peers and connection through answering or making an introduction. It is a very active, and participation based community which spread throughout the web very quickly. Sprouter took off rapidly because many small business owners or entrepreneurs did not have a pool of information and resources that they can access to. Also, the information and advices are provided by people similar to them, making it more credible and precise.

Undoubtedly, it would have been difficult for Sprouter to have a strong base community when it was launched. Ms. Prevette explains that she marketed the site based on grass roots and voluntary support from the users over the course of its launching. Members referred Sprouter to other users, friends or even entrepreneurial publications such as The Wall Street Journal, The New York Times, Inc.

The success of Sprouter was inspired by the struggle Ms. Prevette had to go through while establishing her first company, upinion.com which is a pop culture website for teenagers. She noted that it would have been much easier to get help and find information if there was a source that she can rely on or a source kind enough to answer her cold calling wholeheartedly. The idea was based on the fact that there would be someone like her trying to set up her own business but lacking information and guidance.

As Sprouter became world-wide, the pool of information and potential connections grew larger; it began to provide possible clients, investors and partners as well for entrepreneurs across the globe. One of the issues of being too popular is that often the question you post on the forum may get pushed back before it is answered. This is why Sprouter is launching is new free Q&A service. This addition will provide a whole new forum where successful business owners can directly advise early stage entrepreneurs, on top of peer-to-peer service Sprouter offers. The new feature will have qualified – by Sprouter team – people who can answer questions that would have been lost in the wave of many others.

Sprouter offers a place where information and ideas can be shared and be improved through discussion. It also provides an environment for start-up entrepreneurs to acquire specific and need-to-know tips that may help them grow their business. The sheer numbers of its members speak for the quality and efficiency of the site.