Owning or managing a small business or SME is filled with challenges. The global pandemic made this abundantly clear. There are constant daily issues dealing with employees, customers, vendors, and cash flow. Generally, these normal occurrences are short-term in duration and can (or could) be handled fairly quickly with some degree of efficiency. On the other hand, there are a number of challenges that are (and became) more complex and long-term. Small business management must take time to thoroughly and thoughtfully analyze each challenge, so they do not impede business growth and profitability.
Business operations of the past are not the same as business operations of today and tomorrow. The magnitude of changes has forced management to understand future situations before they actually occur. Operating a business in the future will not be the same as operating a business yesterday.
Positive results require advanced thinking and preparation. Review the following business challenges and be prepared for the future.
Economy
Although management cannot control or change predicted economic growth or a recession, economic factors will affect various business sectors in different ways. A positive cycle change for one sector of the economy might be a negative factor for another sector and vice versa. Be prepared to make critical changes necessitated by the economy.
Competition
Competition can be good or bad for business. When a business offers superior quality, value, and service to its customers, it can outshine and beat the competition. On the other hand, businesses that cannot satisfy customers lose out to their competitors. Know your competition and what they offer. Figure out how to beat the competition rather than just meet them in the marketplace.
Customers
Customers change over time as their needs and desires change. Target customers also change. Know your customers and how they are changing or might change in the future. Be the first to adapt to your customer base rather than lagging behind the competition.
Vendors
It’s easy for businesses to become complacent with vendors. The Internet now allows a business to research potential vendors, make contacts, and secure competitive quotes with amazing speed. Enhance your bottom line by doing the necessary due diligence in finding the best vendors for your business or potential vendors should current vendors cease to provide products and services as required.
Financing
You can’t wait until additional financing is needed to figure out where it’s going to come from. It will be too late if your business runs out of cash for operations or debt servicing. Investigate sources and lay the groundwork for additional financing before it is actually needed. Whether it’s debt or equity financing, advance preparation allows for the most beneficial terms.
Employees
To have a highly productive workforce, businesses should estimate their needs for the future and how employees will be hired and trained. Employees make or break a business. Having the best-trained team of employees does not happen by accident or overnight. Don’t let this important decision slip through the cracks.
Marketing
When you combine a changing marketplace, a global pandemic, emerging new products and services, social media, and the Internet, marketing tomorrow will not be the same as in the past. Plan future marketing by reviewing your current strategy, test what works best, and develop a future approach. You want to be ready to implement when the time is right.
Measuring Performance
Rather than operating your business on a day-to-day basis hoping for the best, measure performance in different areas. This is the only way to really know what produces the best results. This is not only measuring revenue and net profit but can be expanded to measure quality, customer satisfaction, marketing, Internet traffic, phone inquiries, etc. Large companies use big data constantly. Similar data analysis can be incorporated by small businesses to improve operations and profit as well.
Customer Service
As competition increases and operations have changed in nearly all business sectors, customers demand more customer service. If one business cannot provide the level of service a customer wants, it is fairly easy to find an alternative source. Customer service will continue to be an important factor in the future for business success. Review the level of customer service your business provides and decide what changes are necessary for future business growth. Implement new policies and train employees to provide an increased level of customer service.
Reputation
A business cannot afford to have a damaged reputation. It is simple to obtain online reviews for practically any business. Once bad reviews appear on the Internet, they don’t go away but customers do. Maintaining an excellent reputation can increase business while the opposite can rapidly destroy a business. Decide today how your reputation can be maintained tomorrow, how complaints will be handled, and how customers will be satisfied. Good reviews are a necessity in today’s business climate.
