Owning a small business is a dream for many. The freedom, creativity and potential for growth it brings are all desirable factors. However, running a small business comes with as many challenges as it does rewards.
If you’re aware of a problem, it becomes easier to fix. Small companies should take a step back and assess their challenges to rethink their strategy. Don’t underestimate the ability to adapt in order to establish growth.
In this article, we’ll discuss the most common pain points small businesses face in their first years of business, as well as practical advice on how to address them. The key to operating a thriving business is to set your company and employees up for success by establishing systems to follow that will ensure advancement.
Common Mistakes Entrepreneurs Make in Their Business Journey
Common small business challenges and how to solve them
A business owner who’s aware of their challenges is way more likely to both meet and overcome them than a business owner who isn’t.
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Acquiring customers
The challenge:
Even the most successful companies have to work hard to find new customers. But for small businesses, this can be even more challenging with little to no startup capital. Small businesses need to get creative when it comes to acquiring new clients.
How to solve it:
Understand who your target customers are.
- Your business will need to determine your ideal customer demographic. The best way to do this is by creating a customer persona. If you have a very specific idea of the customer your business trying to sell to, you can start creating content specifically for your business’ target market.
- This includes using messaging the target audience cares about in a tone of voice that will appeal to them, as well as being strategic with the social channels you promote your business through.
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Make sure your business is visible.
- Social media and inbound marketing are great ways to get the word out about your small business without spending a ton of money. Lean on employees, friends, family and current clients to share and promote social posts.
- Make sure your business is creating and updating social sites such as your website, Facebook and Instagram. This allows customers to keep up to date on your business and never miss out on important information. Being easily accessible to customers increases exposure as well as ease of purchase/services.
- Don’t underestimate the power of a good email campaign. Getting targeted emails into your ideal consumer’s inbox is a great way to stay top of mind.
- Making use of Google Business Profile is another great way to get your business more exposure online. It is a free listing from Google that allows you to provide details and photos of your business describing your location, services and products so customers can find your business on Google search and maps. This free tool increases your business’ visibility across all Google services.
Personalize your customer service.
- Are you making the most of your small business’ customer service experience? When you start a new company, you may not have a lot of money to allocate toward marketing efforts. This is where word-of-mouth marketing comes in. If your business provides unforgettable customer service to its clients, they will want to come back and will most likely recommend your company to other people.
- Personalized customer service is more attainable for small businesses, not to mention it makes clients feel special and will help your business retain and gain new clients.
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Marketing and advertising for lead generation
The challenge:
Defining the area of marketing to prioritize your efforts can be difficult. Many small business owners can feel overwhelmed when it comes to the abundance of marketing and advertising strategies to choose from.
How to solve it:
Build an email list.
- One of the best ways to move prospective customers along the buyer’s journey is by building trust and nurturing a consistent relationship with them. One of the best ways to do that is by building an email list.
- Email marketing can be one of the most effective marketing channels if your business can manage it. Email lists keep your business top of mind to your subscribers, as you continually provide them with valuable content.
- The best way to do this is to build an opt-in email list. This is when subscribers voluntarily give your business their email address so your business can send them emails. These customers may already be interested in your business and will may purchase with some nurturing.
Consider PR opportunities.
- Tapping into public relations efforts is a great way to spread brand awareness. PR focuses on finding your business’ voice and establishing your business’ place in the market.
- It’s a good idea to figure out what outlets and influencers cover your business’ industry, then try to build relationships and work with them.
- While PR opportunities are generally something that your business will need to outsource and pay for, they are well worth the investment to get the word out about your business.
Work with other small businesses in your area to cobrand and collaborate.
- Working with another company can help to enhance your brand and reputation. If they’re a bigger, more recognized brand than your business, they can help to elevate your own company. Co-marketing helps your business inherit some of the image and reputation of the business you partner with, so make sure they’re a reputable brand.
- Collaborating with another company is also a great way to expand your business circle. If they have a different target audience than your business, it’s beneficial for both businesses to gain new prospective clients.
Establish authority in your industry by blogging.
- Blogging is an excellent way to create demand. Producing consistent, high-quality blog content for subscribers with help to increase online presence, search authority and trust.
- Blogs are great for building brand awareness as well because they can help drive traffic to your business’ website and hopefully convert that traffic into leads.
- Creating high-value content on your business’ blog with well-researched SEO keywords helps to drive traffic to your company’s site. This will increase your business search ranking, making it easier for potential customers to find you online.
- Working with other businesses in your field or social influencers to write guest blogs can also increase awareness. When you can share your business with a new audience, you’re opening up new opportunities to be seen by people who may not have come across your company otherwise.
Expand your reach through Facebook ads.
- Facebook ads can help create brand awareness by reaching potential clients that have a search history matching your business offerings.
- Facebook ads are also an amazing way to retarget those who have already visited your business’ site or clients your business has worked with in the past. Staying top of mind with your business’ current and past clients is just as important as reaching new clients, which is why ads are great for retention as well.
- Leveraging social media platforms that your business’ target audience is already on, like Facebook or LinkedIn and creating content that inspires your audience to sign up for your email list or visit your website is a great way to utilize your social media presence.
- Be sure to take advantage of the fact that Facebook ads allow your small business to advertise locally, depending on your business’ product or service.
Optimize your website for conversions
- Using SEO keywords is a great way to help optimize your business website for better conversions.
- Linking out to reputable companies and websites can help build authority.
- Producing high-value content, such as a blog like we mentioned above, helps to optimize your business website for search and conversion.
- Running a full website scan can be beneficial to show areas that are performing well, and those that need improvement. Sites such as SEMrush offer free tools that will scan your business site and provide suggestions on how to improve your business website.
- Administration
The challenge: It’s necessary to keep track of payments, purchases, sales and bookkeeping. But it’s also time-consuming and complicated, particularly if you’re not trained in these fields. This is why it’s important not to overlook the importance of administration tasks – especially if you aren’t skilled at them.
How to solve it:
Develop a consistent workflow for bookkeeping, payroll, scheduling meetings, etc.
- Thankfully, there are many solutions to streamline these processes. Consider hiring someone to handle the administrative tasks so your business can focus on other important areas. This can be an employee or a bookkeeping/payroll service.
- Hiring an administrative assistant or outsourcing these tasks frees up your time to focus on growing your business where your expertise is needed.
- In these cases, spending money to optimize your administrative workflow is actually less time-consuming and will save your business money in the long run.
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Administration can extend into your client lifecycle framework.
- Make sure your business has a customer relationship management system (CRM) with set systems in place for adding new clients.
- If you’re not sure what a CRM system is, essentially it provides a localized place where your business can store customer data and track interactions. You can then share this information with all your colleagues to help your business manage its customers and improve client relationships.
Improve the overall experience for new and returning clients.
- This is where building an email list comes in handy. Having a welcome campaign is an excellent way to interact with new customers.
- Creating campaigns that prioritize existing clients helps to keep up consistent nurturing and stay top of mind. This could be a monthly newsletter or sending out emails for new products/offerings.
- Also, be sure your business is taking measures to remarket customers who have already visited your business website with targeted ads. This can be done through social ads and email marketing.
- Creating a rewards or loyalty program for your business’ customers is a great incentive to keep them coming back. If you offer rewards to loyal customers they are more likely to return and refer others to your company.
- Hiring talented people
The challenge: Many business owners focus on short-term needs rather than hiring quality talent to meet long-term goals. Your business’ employees greatly reflect your customer service. Making a hiring mistake could be costly to your business in more ways than one.
How to solve it:
Hiring good quality candidates is worth the wait.
- There’s nothing worse than going through the entire hiring process only to have to find a new candidate and do it all again a month later. With the high cost of hiring and training, your business doesn’t want to waste money. It’s super important to make sure your business is attracting and hiring the right type of person for your company.
- Taking the time to effectively recruit a high-quality candidate is worth the wait. If your business doesn’t have an exceptional team that understands your business and can work together effectively, then your business isn’t going to succeed.
- Never settle for a good enough employee when your business can wait for a great one. A great employee can make all the difference when it comes to taking your business to the next level.
Develop a recruiting pipeline.
- If your business is struggling with employment, consider creating employee personas, similar to the customer persona we mentioned above. Create a persona for each position and list the skills, traits, and behaviors your business is looking for.
- Once your business knows whom it’s trying to attract, you can take steps to get them interested in applying for your business by developing job descriptions seeking candidates with those skills and capabilities.
- These steps will help your business attract the right candidates and build a recruiting pipeline that will help make the hiring process more predictable.
Have an onboarding process in place.
Having a process for onboarding and retaining employees is just as important as hiring the right candidate. If employees are constantly leaving, it can deplete your business’ overall productivity.
If employees don’t feel appreciated or seen upon hiring, they won’t have a reason to stay. Make sure to have training resources, welcome activities and clear objectives readily available for all new employees.
Invest in good talent with competitive salaries and benefits.
- Once you’ve found the ideal candidate, your business needs to make sure the salary and benefits your business offer are competitive within your business’ industry. The only way to attract top-quality candidates is to offer them what they’re worth.
- Employees want to feel valued and appreciated, a great way to develop loyal employees is to offer incentives and quality benefits for their hard work. Instituting employee appreciation strategies such as anniversary and birthday gifts, milestone rewards, and employee of the month awards are great ways to drive retention as well as keep company morale high.
More Money Isn’t the Only Thing That Will Attract Quality Employees
- Access to cash flow
The challenge: Many small businesses have limited resources to invest in opportunities to grow their business, which creates a need for cash flow.
How to solve it:
Consider one of the following financing options.
Term loan
- Small business loans offers small businesses a lump sum of working capital upfront to help meet unique business needs. Term loans can help with expansion, gaps in cash flow, opening a new location, purchasing equipment and so much more!
- Consider using funds from a term loan to hire a short-term contractor to help with acquiring customers for your business, establish a strong social media presence or create a personalized customer experience.
Line of credit
- A line of credit is a flexible financing option that allows quick access to a defined amount of working capital. Businesses can conveniently draw on the working capital as they need it up to an approved amount. Businesses are only responsible for repaying the funds they used.
- A line of credit can be a great way to support any marketing and advertising efforts for lead generation like Facebook ads or funds to assist with a great PR opportunity.
Merchant cash advance
- A merchant cash advance gives businesses access to fast working capital so they can meet their business needs based on future credit card receivables. This type of financing gives businesses upfront access to a lump sum in return for a portion of the future revenue receivables at a discounted price.
- Consider upgrading your bookkeeping, payroll or CRM software with funds from a merchant cash advance.
SBA loan
- An SBA loan is a loan program administered by the Small Business Administration and is partially guaranteed by the government. This program works with other financial institutions to help give small businesses access to working capital that otherwise might be unavailable to them.
- SBA loans can be a great long-term solution for businesses that are looking to invest in new technology or hire top-tier talent.
Business credit card
- Business credit cards can help provide short-term startup financing to help small businesses thrive.
- A business credit card is a flexible short-term option to help build business credit for startups and small businesses while helping to support any business need you might have.
Conclusion
There are many standard challenges that every small business can face, but when your business takes the time to discover pain points and use strategic planning to create effective systems, they can easily be managed.
Addressing common issues such as acquiring customers, marketing strategy, lead generation, administration, hiring/retaining talented people, and obtaining access to cash flow will allow your small business to experience more growth and advancement.
