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Javier García By Javier García • June 15, 2018

Good and bad practices of SMEs in San Luis Potosí

Last December, at Impactum we conducted a series of in-depth interviews (not to be confused with surveys) to more than 100 businesses and SMEs in San Luis Potosí to better understand our market, improve our value propositions and launch, this 2016 , new products that are in accordance with what the market needs. In this process we discovered many things and learned, not only about our customers, but also about business in general and these are our conclusions:

Most SMEs in San Luis Potosí do not know who their clients are

When we say that they do not know their clients, we do not refer to their first and last name, we refer to being able to define the type of people who buy them, their target market or the market niche to which they are directed. When we asked them if they could tell us who their clients were, the most common answer was: "everyone", the reasons why this is wrong are several but the main one is that if you try to satisfy the needs of everyone you are never going to finish designing your product, it is always necessary to define and define a target market (or several) so that you can identify the specific needs of each one. We ourselves learned from this, as well as many agencies thought that all companies could be our customers but now we know what kind of companies and especially what kind of people are our ideal customers.

SMEs are empirical

The businesses and companies that we interviewed, some more successful than others but the factor that they all had in common is that they are companies that did not follow methodologies, few of the owners studied or prepared to start their business, but they threw themselves into starting their business and everything has been based on trial and error.

This pattern was evident not only when talking with the owners but also the managers and supervisors themselves told us that the company could project a lot of professionalism, but that was basically a good job of a designer that projected that image and inside most of the companies they  worked day by day, without planning, measuring or some kind of administration methodology.

We found some exceptions, for example franchises (not all), companies for which a consultant had passed or companies directed by someone with serious master's studies or management graduates.

Word of mouth is the most important thing for companies

It was also a pattern that was repeated in more than 90% of the companies we interviewed, all say that the reason they have customers is the word of mouth recommendation, regardless of whether it is a company that invests or does not invest in advertising ( outbound or inbound). It was not even a question in our interview but everyone mentioned it at some point casually (and most very energetically), which means they really believe it. However when we asked them how they knew if a client came by word of mouth or some other means and if they mediated in some way the client's satisfaction (directly related to the recommendation) they all told us that they did not mediate and had no idea of where their customers come from,

The majority of SMEs are noble businesses

With this I mean that many owners expressed to us that their business is a lifestyle business, that means, something they like to do and decided to do it for more people and generate money with this. That is why businesses with these characteristics remain stagnant and do not grow.

It is not that it is a bad business, often on the contrary, it is a very good business but it may depend on the talent of the owner (something very difficult to replicate) or it may be possible to make it grow but simply the owner is not interested because for him "it's fine as it is".

Marketing remains an unknown concept

One of our questions, the final one in fact, was to ask the owners of the businesses to explain to us in their own words what marketing was for them, we told them that there were no wrong answers that we only wanted to know their perception by this discipline; however we know that if there is a correct answer about marketing, for our study we stick to the definition of marketing by Philip Kotler,, and with this in mind we classify their definitions as "successful", "deficient" or "wrong".

I think it is already clear where we are going with that, it is sad to see how the vast majority of SME owners in San Luis Potosí have a wrong or deficient idea of marketing and as an additional fact, many (especially the elderly) see it as an unnecessary expense.

 

The lessons that this end-of-year exercise gave us were very interesting and this is only a summary. I hope it serves you something and we leave the following infographic for you to see more statistical data:

infografia pymes en san luis potosi

We would like to know your opinion, especially if you are a SME owner. Did you feel identified with any of these problems? Would you like to receive help to solve and improve it? Write us your comments.