Small businesses face many challenges. After all, larger firms are likely to have stronger brands, steadier finances, and more internal resources. To combat this, small businesses must find ways to use their smaller size to their advantage. One example is with small business CRM systems. CRM applications turn knowledge into an asset, and small businesses have some advantages when it comes to implementing a CRM program.

Small businesses often aim to leverage two things: a base of contacts and an idea about the process of selling to these contacts. These can be advantages, but only if the business systematically capitalizes on them. CRM software helps a business do that, and thus turns this background knowledge into a true business asset.

Small as an Advantage with CRM Applications
All of the following are beneficial ways to use CRM applications, and each of them is easier for a small firm to execute than a large one. At start-up, CRM software can be made the standard operating procedure, and data can be accumulated at a natural pace. In contrast, larger firms develop routines that are difficult to alter, and large stores of information make a transition to a CRM system more time-consuming and expensive.

1. Quantify the Knowledge Base. An entrepreneur may have a list of contacts, but until he or she can quantify what this represents in potential sales, it is difficult to formulate reliable sales plans and budgets.
2. Refine Proprietary Data. Publicly available data is generally rife with errors and outdated information. By refining the data from the start, a business can quickly develop a proprietary database which is more reliable than commercially-available information.
3. Get Training Done at the Start. This is much easier than stopping everything for CRM training once the business has hit full stride.
4. Test Key Assumptions. CRM applications can help test different marketing techniques and value propositions, so the organization can hone in on a successful formula more quickly.
5. Monitor Sales Activity. Sales is a numbers game, so tracking activity is the first step in identifying whether the sales effort is on track.
6. Eliminate Duplicate Processes. Businesses without comprehensive relationship management systems are full of duplicate processes, from recording client and prospect data to reporting.
7. Avoid Cumbersome Transitions Down the Road. If all goes well and the business is a success, it is going to need a CRM application eventually. Building CRM processes into the business from the start is much less cumbersome than a transition later on.

Tips for Making CRM Software Affordable at Start-Up
Of course, start-ups are often trying to run as lean as possible, and they may view investment in CRM as something they will tackle in the future. As described above, though, there are distinct advantages to implementing a CRM program from the beginning. The following tips can help make doing so more cost-effective:

• Use SaaS. CRM applications can be accessed on a software-as-a-service (SaaS) basis. This can reduce the upfront costs of software and data storage.
• Look for versatile providers. Look for small business CRM providers that have scalable products that can grow with the enterprise. Also, vendors who can start CRM applications on a SaaS basis but also have the capability to transition it in-house can make future changes more seamless.

Sources
Destination CRM Magazine
Forbes.com