Top 10 Challenges Small Businesses Face
Running a small business is no small feat. There is a lot to consider, from your profit margins to growing your customer base. At alldayPA, we provide outsourced customer services to small and large companies alike. With our trained team expertly handling your customer communications, you can more easily focus on the challenges ahead.
In today’s volatile climate, it’s more important than ever that aspiring business owners are wise to the setbacks, as well as opportunities, that small businesses face. So, we ask:
What are some of the common challenges that you might expect as a small business, and how can you avoid them?
Here is everything we have learned to make the process a little less daunting for you.
Finding and retaining customers
One of the biggest challenges facing small businesses is finding their ideal customers and turning them into loyal customers.
Before doing anything, including making the actual product itself, you need to conduct market research. This will allow you to determine a gap in the market for your product. Once you have established your target audience, work out where they tend to spend their time – be it physically or digitally. For example, will you find them on social media platforms like Instagram? Do they like to sign up for emails where you can provide them with discounts and early access to sales or new products and services?
In establishing where your ideal customer is and what their habits are, you can create content and a marketing strategy that will help you tap into their space.
Once you have their attention and they make their first purchase, the key then is to retain their custom. You can do this in a number of ways, such as by creating a loyalty scheme, offering free gift cards and providing good-quality customer service. This is where we can help. At alldayPA, we have experts across our contact centres ready to help you improve the customer service you offer your customers.
Creating a strong business strategy
Every business, big and small, requires a strong business strategy if it is going to be successful. Having a business strategy will enable you to grow and take calculated risks. In creating this strong business strategy, you will be able to keep up with the demands of the market and forecast industry trends.
A good strategy will outline business matters such as your business objectives, your ideal customer, and your financial projections for the next few years. It also gives you something to present to banks and shareholders when you are looking for additional investment in the business.
Being able to keep up with market demand
A small business can often find it difficult to keep up with market demand. As much as you want a product to do well, creating excess products means running the risk of haemorrhaging money, so to keep production costs manageable, most small businesses create a limited number of each item at the start of their journey.
The problem you might run into is that the more of a hit the product becomes, the harder it might be to keep up with market demands. To combat this, you may decide to hire more staff, and reviewing your business goals and objectives quarterly also helps to ensure you have a strategy in place to deal with periods of growing demand.
Dealing with cash flow
The reason most small businesses fail within the first year is due to the mistakes they make with their finances. From incoming and outgoing transactions, most business leaders have a lot to learn in order to maintain a steady cash flow and increase profit margins.
To ensure you keep one step ahead of any cash flow issues, the first thing to do is hire an accountant and schedule time each month to look over your accounts, create the necessary forecasts and keep a regular record of your inventory.
While this may sound like a lot of work, thanks to the development of technology, there are a multitude of software options available, which allow you to track payments and help create new invoices when required. Your accountant will be able to advise on the tools so everything is in one place. Depending on the software option you go for, you may be able to set up notifications for when your bills are due to help you better keep track of your expenses.
In tracking this, you can foresee any changes you need to make in order to have a successful business. This might mean creating a shorter payment time (from 60 days to 30 days) to help you keep a steady flow of cash coming into your business or reducing the stock of a product that isn’t selling as much as some of the others.
Balancing both growth and quality
Time is often an issue when it comes to small businesses. As you might expect, it can be very difficult to predict growth spurts or sudden dips in demand.
In trying to keep up with these changes in demand, some small businesses can lose the quality of their product or service which is why you should develop a growth plan for your business if one does not already exist. This will ensure you have a strategy in place when the time arrives.
Some other ways in which you can strike a balance between growth and quality include:
- Establish your targets: This may include your business’s minimum profit level, for example. Once established, you will need to decide how you plan to invest any additional money you might receive once this profit has been exceeded.
- Don’t forget your existing customers: For example, you can include discounts if they purchase x amount or some form of loyalty programme.
- Collaborate and outsource where possible: Most small businesses think they have to do everything themselves. The truth is, as you grow, it makes profitable sense to delegate and outsource more to raise efficiency. This is where companies such as alldayPA can help. In allowing us to help you provide customer service support, you can focus on the other elements of your business that need your attention. In outsourcing some tasks to a dedicated trained team, you know your customers are being looked after properly.
Staying passionate about your business
Running a business is gruelling work. It takes a lot of mental energy out of you. In the moments that you feel like giving up. (because those moments will come at least a couple of times in your business journey) The passion and obsession you have for your business will keep you going and stop you from giving up.
You can stay passionate about your business by having the right people around you. This doesn’t include your colleagues but mentors and others in the industry people you can lean on advice.
It is also important to have the why at the back of your mind. Why you started the business and what you hope to achieve. Write this down somewhere you can look back on it from time to time.
Every business will have to increase its workforce. Hiring new talent, especially for a small business, can be a daunting and expensive task. It is also rewarding as it wil allow you to delegate tasks and allow you to focus on expanding and growing the business instead of the dealing with the day to day tasks.
Hold on to that during your hiring journey as it can be quite challenging to start with. For example it can take hiring a few wrong people before finding the fit for you and your business.
There will also be other challenges you have to consider when hiring new staff. This includes health and saftey regulations and health and safety regulations. You also have to make sure you are aware of the employment laws we have in the UK. This includes things to do with dealing with conduct issues, ensuring they have a fair wage and factoring in things such flexible working.
Creating a company culture
As a small business, it can be hard to establish a culture within your workforce. The best way in which to do this is to focus on your values. What does your business stand for? Are integrity and honesty important to you? Once you have determined what these values are, you can discuss this with your employees, making sure the values are in their minds as they go about their tasks.
There is some truth to the saying: ‘It is not what you know, but who you know’. Once you have established your business, it is important to network. Go to networking events and talk about your business on social media platforms like LinkedIn. The challenge is that it can be quite expensive which means you will have to do your research and make sure the events you attend are right for you. Is it a leading event in your industry or one you are trying to break into?
It can also be daunting as a small business putting yourself out there. Start by striking up a conversation with the person in front of you in the line for your morning coffee. You never know the opportunities that could arise from saying hello to someone new.
Being susceptible to burnout
As a small business, you are often firing on all cylinders. As a business owner, you will want to have as much control over all aspects of the business as possible, making a 9-5 impossible at times.
Of course, as you become business leaders and have a long-lasting business model, you will be able to create more of a work/life balance for yourself. However, in the interim, burnout is a real thing and can cause you to put a halt on all your plans moving forward.
Some signs you are experiencing burnout include:
- Feeling empty
- Not being able to sleep
- Being emotionally unavailable to your friends, family and colleagues
- Experiencing low energy
- Having a negative attitude to work when you are usually more positive.
- Dreading going to work
- Wanting to leave work the moment you arrive
In order to avoid burnout, focus on the things in your life you can control and remember to factor regular exercise into your daily routine. Also, add stress techniques to your tool kit to help you in moments of high intensity.
Say goodbye to your challenges today!
As a business owner, you are constantly spinning multiple plates. At alldayPA, we can take some of the plates off your hands, such as answering your phones and dealing with customer enquiries.
We handle the day to day of customer communications so you don’t have to. Our clients not only benefit from improved customer feedback but, by winning back that additional time that is so easily spent on handling customer interactions, they can channel this energy into what matters most – growing their business.
So, what are you waiting for? Contact us today to outsource your customer service to a company that will truly care about your business as much as you do.