Startups and entrepreneurs must know that there are business challenges that must be met in order to be truly successful
The ugly truth that people don’t tell you about SMBs is that most of them don’t make it in the long run. Sure, some experience their first problems during the very launch, which makes their journey quite short-lived while others simply fail later on. This usually happens due to the lack of awareness or skill to handle some of the most pressing issues your company is currently facing.
In order to help your SMB avoid this fate, here are four major business challenges that you need to learn how to overcome.
1. Measuring performance
One of the first traps that inexperienced entrepreneurs walk into is the inability to adequately measure the performance of your business. With one’s online presence becoming more and more important, it is even easier to focus on the so-called vanity metrics and get completely sidetracked from making an adequate estimate of your success.
Sure, your posts may have many shares, likes and retweets but how do these things reflect your sales? You really have no way of knowing.
Therefore, it is vital that you establish relevant metrics as soon as possible, things like sales, conversion rates, traffic, number of subscribers or the number of repeat visits on your e-store. Once you have that settled, you can easily start making estimates on how quickly you are progressing towards your goals.
2. Providing enough cash flow
Another major business challenge that a lot of small companies aren’t aware of is the one revolving around the cash flow issue. If your products are so expensive that your customers have to use credit payments, you will face a problem where, on paper, you have enough funds but in reality don’t have the capital to reinvest.
Once this happens, you will have several options at your disposal. You can either find a factoring company and sell some of your invoices, create an additional stream of revenue, sell an asset or apply for an additional loan. Each of the above-listed comes with its own set of advantages and disadvantages and it is your job to decide which one of them suits your business best in the long-run.
3. Building your brand
The next vital business challenge you need to realize is that a brand isn’t a logo, a color scheme or even a product. A brand is an emotion that your customers have when they think about your company.
Of course, this is a never-ending process, which is why you need to closely watch your current online reputation. One of the ways to do so is through media monitoring and analytics like those provided by a media intelligence platform.
4. Delegating responsibilities
Finally, the major flaw of every successful entrepreneur is vanity – the belief that you can pull everything off on your own. By believing that nothing can be done without you, you are not just demonstrating lack of trust in your team but also straining yourself beyond your capabilities. In time, this will result in you getting exhausted, which will seriously diminish the productivity of your business, seeing as how, all until now, all of its processes revolved around you.
The best way to avoid this is to provide your team with as much autonomy as possible, as well as to start grooming some of your employees for leadership positions from the very start. This will both improve the structure of your company and give you an easier transition from a small to a medium-sized enterprise.
By overcoming these four important challenges, you will lay out the foundation for the success of your small business. However, the important thing you need to keep in mind is the fact that these problems aren’t exclusive to SMBs.
Cash flow problems, issues revolving around branding and attributing too much value to vanity metrics are traps that even some of the largest conglomerates can walk straight into. Therefore, learning how to handle them might help you grow as a businessman, as well.
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