Embracing Creative Small Business Recovery

Jobs data, collected since 1985 by the National Federation for Independent Businesses (NFIB), show a steep drop in the average number of workers per small business since the start of the recession. Those numbers have bounced back to almost long-term norms, but they signify a big shift in small business strategy over the past few years.

Small business owners haven’t actually fired as many workers as have larger companies. Instead, new entrepreneurs flooded the market with solo and small businesses that serve highly specialized markets. Embracing recovery may no longer require creating new, dedicated jobs within small companies. Instead, entrepreneurs can use just-in-time services to make targeted, nimble investments in growth.

Leverage Freelance Talent and Atomized Work Processes

Digital marketing consultant Tom Powell wrote about the “atomization of work” in 2009. In his “CoInnovative” article series, Powell noted how Amazon’s Mechanical Turk platform allowed companies to break larger tasks and workflows into assembly lines powered by remote workers.

The trend has since caught on with startup companies that handle outsourcing for tasks once managed exclusively by employees or more expensive contract services. For instance:

• Fancy Hands and Zirtual offer professional assistant services, which lets small business owners outsource research and administrative tasks for as little as $5 per assignment.
• Taskrabbit, Exec, and Postmates bring skilled free agents to your office or to your promotional event, assisting with everything from customer deliveries to product assembly.

Like traditional temp agencies, these services eliminate the hassle of hiring and payroll by offering staff on flexible terms. Plus, they add the benefit of immediate scheduling and community-based quality control.

Borrow Resources in the Collaborative Economy

Small business owners can extend their reach without taking on significant overhead, thanks to a new breed of “sharing” services:

• Zipcar (owned by Avis) and Enterprise Car Share both rent delivery vehicles by the hour, reducing the need for companies to purchase vans or trucks during a growth spurt. Their service includes comprehensive auto insurance, further reducing cost and hassle.
• Uber offers black town car and SUV service on demand in many large cities, which allows business professionals to meet and greet clients in style at a fraction of the cost of a dedicated car service.
• Shared offices and coworking spaces can stave off the need for leasing dedicated office space or conference rooms, especially when meeting clients or prospects in new locations. For instance, members of the League of Extraordinary Coworking Spaces enjoy reciprocal privileges in over a dozen of the country’s largest cities.

After hoarding cash reserves during the recession, small business owners may be reluctant to spring for vehicles, office leases, or dedicated employees. However, by spending a little cash on extra help and gear during crunch periods, you can preserve capital while sparking new growth. Even better, many of these investments directly benefit fellow entrepreneurs and solo professionals who use sharing platforms to power their own businesses.

Joe Taylor Jr. has covered personal finance and business for more than two decades. His work has been featured on NPR, CNBC, Financial Times Television, Fox Business, and ABC News. He recently completed a personal finance book entitled “The Rogue Guide to Credit Cards” (Rogue Guide Books, 2012).