Learn From These Small Business Growth Tactics
- To find out what your business customers need, take the time to listen to them and talk about the problems that keep them up at night.
- When building a hyperlocal marketplace, the best way to start is to put people on the ground who can find out about existing communities and programs to help local businesses.
- Townsquared helps businesses find the services they need in their local area. Although it’s currently a free service, Rohit Prakash has ideas for monetizing Townsquared with added-value services that allow businesses to band together to gain leverage in their purchasing decisions.
- Townsquared aims to reduce the failure rate for small businesses and create thriving business communities in cities across the United States.
Rohit Prakash is the CEO of Townsquared, a hyperlocal community for small businesses that helps them find the information they need to grow and thrive. Through his experience of building Townsquared communities in several cities in the United States, Prakash has a unique insight into what it takes to grow a small business from the ground up.
What is Townsquared?
Many of the problems that small businesses face during their growth are logistical in nature and require local knowledge to solve. For example, a coffee shop owner may be fantastic at making coffee, but may not have the skills to market the business locally or keep accurate accounts. To ensure the success of the business, the owner needs to connect with local marketing and accounting services that can provide the business skills that aren’t present in a tiny coffee shop business. However, finding the services you need in the local area can be time-consuming, which is why Townsquared is so useful. This platform connects local business owners with a network of other businesses that are located nearby, allowing them to find the services they need, as well as promoting a culture of shared knowledge and support.
The History of Townsquared
Originally, Townsquared only served businesses in San Francisco. However, Prakash has since expanded the business into Oakland, New York City, Portland and Seattle. In 2017 and 2018, he plans to bring Townsquared to business communities in more than 30 metropolitan areas in the United States.
The Personal Touch Counts When Building Hyperlocal Networks
In every city where Townsquared operates, Prakash has worked to create a strong community of local businesses built on trust and honest communication. The first step in building this kind of community is to get out into the city and find out what concerns are keeping business owners up at night. Each time Townsquared launches in a new location, the company puts people on the ground for three or four weeks to find out what makes the local community tick. In addition to talking to business owners, these Townsquared representatives also speak with local government officials and non-profit organizations to find out what programs already exist to help local businesses and how Townsquared can help to enhance them. At the time of the launch, Townsquared hosts an event in the city, giving business owners and supporters an opportunity to meet in person and build strong connections.
The Challenges of Building a Hyperlocal Community
Expanding a business like Townsquared can be challenging. Every time the company adds a new location, the process of talking to local business owners and city officials has to start all over again. It’s almost like building a new business from scratch. However, by learning from experiences in previous cities, Townsquared has been able to find ways of integrating more quickly into local communities. The company got a community up and running three times faster in Portland than in San Francisco, thanks to a better understanding of what local business people want from a hyperlocal marketplace.
The Benefits of a Hyperlocal Marketplace
Although building a hyperlocal marketplace can be tricky, the substantial payoffs it brings can make the effort worthwhile, both for Townsquared and for the businesses that already exist in the local area. Townsquared allows businesses to operate more efficiently by putting the information they need at their fingertips through a strong network of peers. This creates a thriving business community, which in turn attracts more businesses to the city.
Meanwhile, Prakash has plans for Townsquared to make money from the business networks. Although the platform is free to join, he has plans to generate revenue from value-added services that allow businesses to join together and exert more leverage when negotiating their supply contracts. For example, when Starbucks needs to buy a new type of cup for its 40,000 stores, it can command a great price with the supplier. An independent local coffee shop owner doesn’t have this kind of leverage, which puts them at a disadvantage. Townsquared could make it possible for business owners to band together to gain leverage, not only when buying coffee cups, but also when purchasing health insurance plans, software or other essential business services.
Keep an Eye on Key Performance Indicators (KPIs)
When building any kind of business, whether it’s a hyperlocal marketplace or a mom-and-pop store, it’s important to track key performance indicators to find out how the business is doing. For Townsquared, the most important KPI is retention rate: the number of businesses that stick with the platform. Townsquared has a retention rate between 50 and 70 percent, which is very high for this kind of service. Every business will have different KPIs and should choose them based on the primary business goals, whether that’s to expand the customer base or become more profitable.