To overcome them you have to know what they are
Starting a business is a big achievement for many entrepreneurs, but maintaining one is the larger challenge. There are many standard challenges every business faces, whether they are large or small. These include things such as hiring the right people, building a brand, developing a customer base, and so on. However, there are some that are strictly small business problems, ones most large companies grew out of long ago. Here are the five biggest challenges for small businesses.
- A small business should not allow itself to become dependent on a single client.
- Having professional help with money management frees up a small business owner to focus on operating concerns.
- It’s important to find the right balance between working long hours and business success.
- A small business owner should not create a situation in which the business could not continue in their absence.
5 Biggest Challenges Facing Your Small Business
1. Client Dependence
If a single client makes up more than half of your income, you are more of an independent contractor than a business owner. Diversifying your client base is vital to growing a business, but it can be difficult, especially when the client in question pays well and on time. For many small businesses, having a client willing to pay on time for a product or service is a godsend.
Unfortunately, this can result in a longer-term handicap, because, even if you have employees and so on, you may be still acting as a subcontractor for a larger business. This arrangement allows the client to avoid the risks of adding payroll in an area where the work may dry up at any time. All of that risk is transferred from the larger company to you and your employees. This arrangement can work if your main client has a consistent need for your product or service. However, it is generally better for a business to have a diversified client base to pick up the slack when any single client quits paying.
2. Money Management
Having enough cash to cover the bills is a must for any business, but it is also a must for every individual. Whether it is your business or your life, one will likely emerge as a capital drain that puts pressure on the other. To avoid this problem, small business owners must either be heavily capitalized or able to pick up extra income to shore up cash reserves when needed. This is why many small businesses start out with the founders working a job and building a business simultaneously. While this split focus can make it difficult to grow a business, running out of cash makes growing a business impossible.
Money management becomes even more important when cash is flowing into the business. Although handling business accounting and taxes may be within the capabilities of most business owners, professional help is usually a good idea. The complexity of a company’s books increases with each client and employee, so getting an assist on the bookkeeping can prevent it from becoming a reason not to expand.
The hours, the work, and the constant pressure to perform wear on even the most passionate individuals. Many business owners—even successful ones—get stuck working much longer hours than their employees. Moreover, they fear their business will stall in their absence, so they avoid taking any time away from work to recharge.
Fatigue can lead to rash decisions about the business, including the desire to abandon it completely. Finding a pace that keeps the business humming without grinding down the owner is a challenge that comes early (and often) in the evolution of a small business.
4. Founder Dependence
If you get hit by a car, is your business still producing income the next day? A business that can’t operate without its founder is a business with a deadline. Many businesses suffer from founder dependence, and it is often caused by the founder being unable to let go of certain decisions and responsibilities as the business grows.
In theory, meeting this challenge is easy—a business owner merely has to give over more control to employees or partners. In practice, however, this is a big stumbling block for founders, because it usually involves compromising (at least initially) on the quality of work being done until the person doing the work learns the ropes.
Growth should never be the enemy of quality. A small business needs both.
5. Balancing Quality and Growth
Even when a business is not founder dependent, there comes a time when the issues from growth seem to match or even outweigh the benefits. Whether a service or a product, at some point a business must sacrifice in order to scale up. This may mean not being able to personally manage every client relationship or not inspecting every widget.
Unfortunately, it is usually that level of personal engagement and attention to detail that makes a business successful. Therefore, many small business owners find themselves tied to these habits to the detriment of the company’s development. There is a large middle ground between shoddy work and an unhealthy obsession with quality; it is up to the business owner to navigate the company’s processes toward a compromise that allows growth without hurting the brand.
The Bottom Line
The problems faced by small business are considerable, and one of the worst things a would-be owner can do is to go into business without considering the challenges ahead. We’ve looked at some ways to help make these challenges easier, but there is no avoiding them. On the other hand a competitive drive is often one of the reasons people start their own business, and every challenge represents another opportunity to compete.
Identifying Customer Needs
Identifying customer needs is mission-critical for businesses looking to create a product that truly speaks to their customers’ problems. Not to mention, the easiest way to position your brand smartly in the market is to unite your internal teams behind the specific needs of your customers.
What are customer needs?
Customer needs are the named and unnamed needs your customer has when they come in contact with your business, your competitors, or when they search for the solutions you provide.
To identify the needs of your customers, solicit feedback from your customers at every step of your process. You can identify customer needs in a number of ways, for example, by conducting focus groups, listening to your customers or social media, or doing keyword research.
However, identifying the needs of your customers is easier said than done. In our experience, there are a couple easy ways to gain insight into what your customers need from you.
Methods to Identify Customer Needs:
- Focus Groups
- Social Listening
- Keyword Research
For more resources to help you identify and understand the needs of your customers, check out our guide: Understanding Your Customer’s Needs and Wants in 3 Easy Steps.
Anticipating Customer Needs
Customers don’t part ways with brands that meet their every need. By anticipating customer needs, you can ensure that your product lines up with their expectations before they even have to ask for a new feature, service, or solution from you.
One of the earliest ways to determine your customer’s needs is to conduct keyword research. Think about how you function as a consumer. When you have a question about a product you’re using, is your first step to call the company and ask? Or is your first step to open Google and search for the answer to your question? Most consumers would choose the latter.
That means the secret needs of your customers actually reside in how they search for your product, your company, or your services online. For this reason, keyword research will give you the earliest insight into the needs of your customers.
Meeting Customer Needs
This is where the going gets tough. Because, once you have knowledge and data around what your customer needs from you, the next step is integrating that knowledge into already existing processes. Often this can mean revamping an entire marketing campaign. You may even need to plan, build and execute on a brand new facet of your product. Each business will have to approach this step differently, but we’ve created a framework for how you can identify, understand and meet customer needs.
How to Meet the Needs of Customers:
You can follow a simple, four-step procedure to meet the needs of customers.
- Identify what your customers need from you through keyword research, focus groups, or social listening.
- Distribute the information to relevant stakeholders in your organization.
- Craft product features or create content that speaks to your customer’s needs.
- Collect customer feedback on how your efforts meet their expectations.
After you’ve identified what your customer needs from you, take the data you’ve collected seriously. If customers (or potential customers) are asking for something, big or small, make sure you deliver. Businesses that have a developed methodology for how they collect and share customer insights within their org will have the best luck at meeting customer needs quickly.
For some businesses, that could mean assigning a dedicated team to collect customer insights. Other businesses may be able to roll it into the responsibilities of existing departments. If you develop a strong system for how you discover, analyze and address customer needs, your organization will be set up for long-term success. So take the time and put in the legwork.
Why is it important to meet customer needs?
All of today’s most successful businesses take steps to meet customer needs early and often. For the modern marketer, taking strides to make sure your customers needs are met will help you align with other internal teams at your organization, like your sales team, customer support team, and your product team. With your whole organization operating under a cyclical process of anticipating, identifying and meeting customer needs, you’ll see results in no time.
Looking for more resources? If you’re looking to understand, identify and meet your customer’s needs, you’re already practicing customer-first marketing. What’s customer-first marketing? We’re glad you asked.
How important are customer reviews to shoppers? Very important, as it turns out. The fact is, 90% of consumers read online reviews before visiting a business. And 88% of consumers trust online reviews as much as personal recommendations.
We’ve got many more fun, interesting facts that’ll help you see why your customer review is so important to other shoppers! Check out our infographic, “The Importance Of Online Customer Reviews”, to read more facts. Enjoy!
Infographic by- Invesp conversion optimizaion
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For nearly 9 in 10 consumers, an online review is as important as a personal recommendation.
Customers are likely to spend 31% more on a business with “excellent” reviews.
72% say that positive reviews make them trust a local business more
92% of users will use a local business if it has at least a 4-star rating
72% of consumers will take action only after reading a positive review
Reliability (27%), expertise (21%) & professionalism (18%) are the most important reputation traits for a local business
Estimated Number Of Online Reviews Customers Read Before Trusting A Business
|Estimated number of reviews||%age|
86% of people will hesitate to purchase from a business that has negative online reviews.
On average, a one-star increase on Yelp leads to a 5 to 9% increase in a business’s revenue. At the same time, a single negative review can cost a business about 30 customers.
The number of reviews posted every minute by Yelp users is 26,380
The percentage of Yelp users that have made a purchase at a business they found on Yelp is 98%
The percentage of Yelp users that visit Yelp because they intend to make a purchase is 80%
How To Deal With Negative Reviews
When you receive a negative review, here’s what you should do:
- Respond Promptly
- Be real and admit your mistakes
- Correct inaccuracies
- Highlight your strengths
- Write like a person, not a corporation
- Take it offline
- Provide restitution if it’s warranted
- Ask loyal customers to share their experiences
- Be consistent
- Understand How Rating and Review Sites Work