Deciding to build a mobile app for your business is a big deal. Too many small businesses and small business owners look at all software as an intangible item that shouldn't cost a lot of money and isn't a big deal to put together in a weekend. This couldn't be farther from the truth. Here are five tips to help you design and build a quality mobile app that helps grow your business.
1. Build an App That Adds Value
Most small business owners that approach me about building a mobile app for their business don't have a clear plan in place. The problem most small businesses have when it comes to building a mobile app is in coming up with an idea that is commensurate with what the app will cost to build.
Small businesses tend to have small audiences, making it necessary to capture a significant amount more value for every user they get. Before you go any farther, you need to first be sure you can take advantage of the benefits a native mobile app brings over your web presence to the extent that makes it a profitable venture.
The most effective feature of mobile apps right now is the use of push notifications. My recommendation is to find a way you can integrate push notifications to drive repeat use of an app that drives users towards revenue producing actions each time they use it. A good example would be a live music venue that captures the collects information on the types of performances you're interested in attending. The app would notify you every time a band in that genre was playing at the venue. Clicking the notification would open the app to a screen where you can buy tickets. Those tickets are automatically upgraded to VIP status for using the app to make the purchase.
2. Think of Building an App Like Buying Equipment
Investing in software is no different than investing in new machinery, vehicles, real estate, or any other equipment you use to run your business and sell your goods or services. Yet, for some reason, small business owners rarely view it this way.
Like any investment in your business, it needs to produce a return. If you're looking to build an app for your small business, the first step is to decide how you'll generate that return as mentioned in #1. Maybe you're going to allow customers to pay their bills through the app to ease pressure on your staff and improve cashflow. Perhaps you believe you can increase reorders by making it convenient for your customers to do so right through your app. If your customers are mobile but need to communicate frequently with your staff, a chat function might be a great feature.
Whatever that is for your business, evaluate the increase in sales or the cost savings building an app will bring to your business and run a cost-benefit analysis the same way you would for any other major expenditure.
3. Increased Sales Aren't Everything
Reducing costs can also be a powerful value add of your small business mobile app. If your staff is stretched to capacity, you might be able to avoid adding a new person by building an app that automatically notifies clients of invoices and allows them to pay through the app rather than invoicing and processing payments manually. Maybe you can build an integrated calendar that allows customers to schedule service calls, make reservations, or auctions off (or even gives away) unsold or expiring inventory that may otherwise go to waste or cost you money to haul away.
4. Understand that Quality Software Costs Money
Serious money. Software engineers are among the highest paid and most in-demand professionals in the United States. That means if the software you're buying doesn't cost much, you likely have a problem. To have even two people who cost their company $125,000 / year (between salary, benefits, software, hardware, etc. - a conservative figure) working on a project for you for two weeks means a break-even cost (based on a 40 hour week and 46 weeks of billable time per year) is just over $135 / hour - or $21,739. Again, that's a very conservative figure for a break-even cost on a small piece of software, not even a profitable project.
Referring back to #1, there's always a difference between high quality and cheap products. Cheap equipment is unreliable, breaks down frequently, needs to be fixed constantly, and won't last very long. Quality equipment still needs to be maintained, but far less frequently and with less impact on your business when something does go wrong; and spending the money up-front for quality will always add more value in the long run. Software is no different.
5. Decide How You'll Fund App Development
With real costs come real concerns on where you'll get the money to fund the project. This is where investing in software becomes a little different than investing in equipment. Equipment that is mass-produced has value on the open market. Custom software (like custom equipment) in general will be worth a lot more to your business than it would be to someone else's.
If you have the cash, great. If not, your cost of capital should have been included in your cost-benefit analysis and you'll need to reach out to your bank for a loan. A lot of small business owners hesitate to take a loan out for software, but you shouldn't. After all, if your new mobile app can generate or save an extra $3,000 / month, it should be pretty easy to justify a $100,000 loan to your bank. Just remember that you're going to need to collateralize that loan.
This article originally appeared on Chris Searles Blog
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