Business success is never smooth sailing and as the owner of a new, small or medium sized enterprise (SME), you will inevitably find yourself problem-solving on a daily basis. The early stages of business brings with it a range of different challenges but as the company becomes more established, these will ease over time. It’s how you handle and overcome these obstacles that will define your success. Here are 4 common challenges that affect SMEs.
Having no direction
A thorough business plan outlining your long and short term goals and detailing how you see success will help keep you focused and on target. Thoroughly researching all aspects of the business and industry you are entering is also essential in helping you make more informed decisions. Many SMEs do not dedicate enough time to this part of the process because they are eager to get up and running.
Louise Howlett, Commercial Director of Norfolk heat pump company, RA Brown, believes it is important to be realistic in your planning in order to achieve your vision. “When I started developing the heat pump installation side of our business with my husband, Richard, we knew from our research that the renewable sector was going to be an upcoming area of growth. It was an exciting time for us. Our vision at this time was to find the right premises to house our office and a showroom, giving our company a retail presence.”
This was a big decision and investment for the company in the midst of an economic crisis but the directors felt confident in their decision due to extensive preparation. “There was no room for error – the timing had to be right and every step carefully planned but it was a risk that paid off,” adds Howlett.
Actively seeking to ensure employees are engaged, content and motivated is often overlooked by small businesses. In fact, only 9% of SME employees are asked what type of benefits they would enjoy and 44% of SME employees said that employers need to ‘seriously consider’ how they recognise and reward their employees, according to recent studies.
David Rozee, Managing Director of Triark Pumps, a distributor of Sandpiper Pumps, believes that many SMEs do not place enough resource into looking after their best workers. He says: “It is cheaper to retain your top talent than to recruit new people and train them, particularly in a technical industry like diaphragm pumps. If your company is growing, then it is important to ensure that your best people are rewarded for their input and coming on the journey with you. If your employees go above and beyondthen as the business owner, you should be prepared to do the same for them”.
Over 93 years ago John Wanamaker coined the phrase “half the money I spend on advertising is wasted; the trouble is I don’t know which half” and it is still very relevant today. Too many SMEs waste their marketing budgets on campaigns that are not being tracked properly. If you cannot measure results of your campaigns then how do you improve and increase ROI? For your digital marketing efforts, there are so many elements of the campaign that you are able to measure and track. However, at the very least ensure you have Google Analytics installed on your website and goal tracking in place. Phone call tracking software is also a must.
Taking on too much
It takes a lot of sleepless nights and hard graft to start a business from scratch so once the operation is up and running it can be hard for entrepreneurs to delegate tasks for fear of anything going wrong. There are so many roles and skillsets needed to make a business successful – an accountant, a salesperson, a CEO, a marketing department and the list goes on. Many small business owners will take on all of these roles, all at once and work full throttle. While this is sometimes necessary in the beginning due to cash-flow, it is not a realistic long-term solution if you want to grow a business. The goal should be to figure out a process that works, take the time to hire a really great team of people and then show them the correct way of doing it so that work is being done how you want it.