The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, YEC recently launched BusinessCollective, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses.
1. Have a Plan
Data is only as good as the plan you have for it. Know what information you need and why you need it. Nothing is worse than spending countless hours setting systems only to realize it doesn’t answer the questions you need answers to.
2. Start Small When Studying Your Data Stream
Look at the data you’re collecting through your CRM. As you begin your analysis, it’s wise to start small — perhaps with one data stream at a time. For example, you might initially look at the main products being purchased in a particular geographic area. You can then use this information to produce customized offerings to specific segments of your customer population.
3. Understand Your Competition
Information on your competitors used to be difficult to come by, but now with big data, it is all right there for the taking. Knowing what other businesses are making and how they spend their capital can be a huge leg up for a small business.
4. Identify Beneficial Supplier Relationships
One of the easiest ways small businesses can use big data to improve production is through analysis of supplier data, such as pricing or material quality, to identify the most beneficial vendor relationships for their business. By doing so, companies can make sure they’re getting the best quality materials for the lowest price with every deal they make.
5. Align Yourself With the Most Data-Centric Vendors
I wish we had the budget to hire analysts and a full complement of technical teams to slice-and-dice data. We don’t! However, we can find vendors and partners that are data savvy and align with them. Whether a fulfillment center, shipping company or even marketing firm, companies that can truly analyze data will win. We just need to find them, and our business will naturally improve.
6. Track Sales Activity and Customer Data
In order to make the smartest decisions about your business, tracking sales and customer data is a must. Making sure your payment processing technology has a robust data analytics feature will ensure that all of your production decisions are based on the actual activity of your customers or clients. Connectivity is key.
7. Analyze by Season
Big data can be analyzed by seasons, which helps better understand when demand is greater or less than the average. This helps ensure the right level of production so that sales are not missed because not enough was produced. This also helps plan for cash flow and future marketing endeavors, in order to see how slower periods can be ramped up.
8. Refine Your Data to Improve Effectiveness
Data is often compared to oil in terms of how well it can fuel production. However, much like oil, it isn’t very effective in a crude state. Refining data in order to yield important information that can improve production will involve a great deal of testing. This can include A/B testing, with new variations on a product, or tracking interdependencies by tweaking individual aspects of a product.
9. Examine Turnaround Times
Whether you’re generating graphics for your clients or assembling bottles, you can use big data to analyze the process and determine how long it takes to finish a project. This can help you find areas that can be streamlined in your production process, or just identify where the major slowdowns are.