Small businesses face many challenges, especially during their first few years of business. These business challenges can be difficult to overcome and can even cause failure. According to the US Bureau of Labor Statistics, nearly 20 percent of small businesses fail by the end of their first year, 50 percent fail by the end of their fifth year, and a staggering 80 percent of small businesses fail by the end of their tenth year. To help your small business succeed and avoid become one of these statistics, the Jefferson County Chamber of Commerce has compiled a list of some of the most common business challenges that every small business faces and solutions to overcome them.
- Hiring the Right People
Employees are one of the biggest contributors to a small business’s long-term success. Because your employees are the ones who make your business run, it is important to make sure you hire the right people who will help your company grow. This means hiring employees who have the right talent and attitude to positively contribute to your company. It is also important to hire the right people in the beginning because employee turnover can be complicated and very expensive. Onboarding each employee costs an average of over $4,000 for most companies. If you hire the wrong people and have to constantly replace employees, these onboarding costs will really add up.
To solve this business challenge, you need to get out of the short-term mindset and think about hiring for the long term. Because hiring costs are so high, you want to invest a significant amount of time in the hiring process to make sure you do it right. Don’t settle for the first candidate you see just to have enough bodies on staff; instead, spend time in the hiring process and wait until you find great employees who will bring your company to the next level. When you begin the process, figure out exactly what you need in a job candidate, including characteristics, skills, and education, that would create the perfect hire for each position. Check each candidate against this perfect candidate persona to see how good of a match they are for the position and your company.
- Finding Customers
No business can survive without customers, and you can’t just sit around and wait for leads to come in. Even the largest, most widely known companies have people working every day to find new customers. Because small businesses are not common household names, they often have much more difficulty generating leads and finding customers. To add to the confusion and difficulty, there are so many channels business can use and focus on, and you must determine which to prioritize and where you should allocate your resources.
The solution to this business challenge is figuring out who your target customers are, including what they do, where they shop, what their interests are, etc. The more specific you can be, the better. You can have multiple target customers, too. Once you have figured out who your target customers are, you can start to create content and get it in front of your target customers. You should create messages that your target customers will care about, then place them in the places online where they spend time. This will help your small business attract likely customers.
- Growing Brand Awareness
There are a lot of big brands out there that have become household names. You want your small business to have a powerful brand like that, but it’s not something that happens on its own or right away. Those big-name brands have had a lot of behind-the-scenes hard work, rejections, and failures that helped guide them to where they are today. However, there are a few strategies you can follow to put your small business on the path toward building a recognizable brand.
There are many solutions to this business challenge, but here are three basic strategies that can help you build brand awareness for your small business:
- Blogging: A great way to build brand awareness is by running a high-quality blog. This will help drive more traffic to your website and convert it into leads. A high-quality blog will also help your company establish authority in its industry and gain trust from prospective customers.
- Public Relations: Public relations, or PR, is all about your business focusing its voice and finding its place in the market. One key to successful PR is building relationships and working with reporters. These relationships will help you get the right word out about your company. It’s also important to utilize social media to get conversations started about your small business—just make sure you use the social media platforms that your target customers are using.
- Co-marketing: Co-marketing is a partnership with another brand. Your brand will inherit some of the other brand’s image and reputation as well as create awareness of your brand outside of its usual circle of influence. This strategy can help your small business gain a large number of new contacts and customers.
- Building an Email List
An email marketing program is an integral part of a good inbound marketing strategy. However, finding new email contacts to add to your list can be difficult. This is a business challenge that almost all businesses face in their first few years. To add to the challenge, a business email database actually degrades by about 22.5 percent each year. This means not only do you have to build your email list, but you also have to increase it by over 20 percent each year just to maintain it. Many small business owners and marketing teams make the mistake of buying email lists to keep up, but this is never a good strategy. It will be a waste of your business’s hard-earned money and will negatively affect email deliverability and IP reputation.
To solve this business challenge without buying or renting email lists, you should build opt-in email lists. This means subscribers voluntarily choose to give you their email address to receive your emails. One way you can build your opt-in email list is with great blog content that encourages people to want to receive your emails. You should make it easy for those who visit your blog and website to subscribe, such as by adding popups that allow people to enter an email address. You can also improve your old email lists by sending an engaging opt-in message asking old contacts to re-opt-in and promising to remove the contacts that do not respond. This will keep your email list from degrading too much over time.
- Generating Leads
Generating leads is a major business challenge that many small businesses face. Successful lead generation can be difficult—only 10 percent of marketers feel that their lead generation campaigns are actually effective. It is important to generate a high quantity of high-quality leads, and this is usually the marketing team’s biggest objective. When a lead generation engine is successful, it will turn your website visitors into prospective customers and continually bring in new prospects for your sales team.
The first step in solving this business challenge is optimizing your website for leads. Your website is the most important tool your business has for converting prospects into actual customers. To make sure your lead generation process works on your website, look through your website and ask:
- Does each web page clearly guide visitors toward action? Are there pages that leave visitors wondering what to do next?
- Does your website use a tool to automatically pull submissions from web forms and put them into your business’s contact database?
- Are there custom landing pages for each campaign you run?
- Are lead generation calls-to action (CTAs) included in each blog post on your website? Do you actually have blog posts on your website?
You should prioritize optimizing the most popular pages on your small business’s website first. Most websites have a few pages that bring in the majority of site traffic, and these pages are typically the Home page, About page, Contact page, and maybe a product page or a couple popular blog posts. There are also free lead management software and apps available for new small businesses that you should take advantage of. Because marketing can be expensive, finding and using free marketing tools when possible can be very advantageous. Do research and find which free or inexpensive lead management and marketing tools will be most helpful for your small business.
- Finding a Balance Between Quality and Growth
This is a challenge that can be experienced in all areas of business, from product development to content creation to hiring. Business owners and executive will often push for growth at all costs in all business areas. However, if your small business grows too quickly, your team members will become overwhelmed and you will have to start hiring a lot more people very quickly. This can add even more stress to your current team because they have to take the time to train new employees while also keeping up with the growing needs of the business. Your new hires will likely not be trained well, which will end up harming your business.
There is no one-size-fits-all solution to this business challenge. Depending on where your business is in its lifecycle, you may need to focus more on quality or more on growth at different times. The key is to not obsess over everything at once, but to obsess over the right details at the right time. For example, it may be more beneficial to obsess over customer service rather than perfecting your product because products can be improved after launch, especially once you have customer feedback. Customer service, however, is something that will be worth the extra time and effort. You need to find the right balance for your business and focus on what is most important at the time and what will be most beneficial in the long run, and don’t worry as much about the rest until it is necessary to do so.
Small Business Help from the Jefferson County Chamber of Commerce
These are some solutions to the most common business challenges that small businesses face every day, but there are still many other challenges out there. Here at the Jefferson County Chamber of Commerce, we know how difficult it can be to start and grow a business. That is why we are here to help you. We provide all kinds of resources to help businesses in Jefferson County achieve success, including educational opportunities, networking events, advertising options, business referrals, and much more. Our objective is to provide you with exemplary service while supporting and assisting you in reaching your business goals. If you are interested in these benefits, become a member of the Jefferson County Chamber of Commerce. Reach out to us today at 865-397-9642 or online for more information.