5 Challenges All Small Business Face & What You Can Do About Them
Most small businesses fail. In fact, 65% of companies fail within their first ten years. There are plenty of reasons for that failure, but I’d like to focus on some key challenges that your small business will most likely face (or have already faced) and what you can do to overcome them.
While industries can be wildly different, the challenges that businesses face are quite similar. I’ve worked with a wild variety of businesses in my career, and although they offer completely different products and services, one thing remains constant; your business provides something to someone. The “thing” and the “one” are completely interchangeable when viewed from a distance. Actually, most of the challenges faced by small businesses are totally identical.
This leads us to the first big hurdle that you inevitably will face, where you OUTGROW YOUR KNOW. What this means is that your business will reach a point where the talent you started with will not have the experience to get you over the hump. More than likely, you’ve started your business with friends, peers, college roommates, etc. They will be limited by their own experiences, as you will be by your own. This is the time to move those key players to more appropriate seats on the bus, unless they find ways to elevate their own knowledge. As a business leader, it is your responsibility to look objectively at the experiential capacity of your team. If and when you find an opportunity, address it by bringing in experienced talent to get your company over the hump.
After supporting your company with the professional experience it needs, it’s time to catalog your TRIBAL KNOWLEDGE. You and your team have done everything over the years, and there would be no need to document processes and systems because everyone knew how to do them, right? Wrong. It’s time to get this stuff down on paper. Your influx of talent will need constant reminders of how your business gets the job done, and the team doesn’t have time to field a steady flow of questions. That’s why building out processes for the most common activities becomes paramount. Start with an exercise for you and your leadership team of “what would happen if I left the company?” Take note of the processes that would fall by the wayside, and start drafting those systems first. Have each of your leadership team members complete a minimum of one process per month, and have them placed in a common repository where everyone can access them.
Your company will fail if you have constant turnover. Often, business owners do everything to get to the next level but provide very little back to the team doing the heavy lifting, so, GIVE YOUR TEAM SOMETHING TO FIGHT FOR. What do I mean by this? Well, it’s different depending on the person. Some of your team will want more money; some of them will want glory; some will want the opportunity for advancement. Heck, there might be some folks on your roster that simply want better dental care. The key here is to ask. Talk to your team and better understand their motivations and desires. You need to move past the point of simply providing a place to work. Now, you need to provide solutions to your employees’ desires. Start off by seeking feedback through one-on-one conversations. Document what your team is fighting for, and work to provide it to them. From your company’s annual goals, build a scorecard of KPIs to give your team a common goal to fight for. Gamify your KPIs to create some fun around the metrics. Provide feedback. Ultimately, do something for your team. Don’t leave them on the side of the road for this journey.
The people are there, the tools are there, the motivation is there. What next? Make sure you STAY FRESH. I’ve seen so many businesses collapse because they didn’t innovate. Not their product or offering, not their systems, not their way of thinking. It’s absolutely critical to be at the forefront of what’s next and find ways to mirror that in your business. This is the moment where you find partners, vendors, and additional support to add specialization to your company. Re-crafting websites, working on search engine optimization, automation, financial systems, additional training, certifications, specialized product development, and process innovation are all things to think about when you are trying to stay fresh. The key here is to seek out ways to improve your business, product or offering, and brand beyond what you have the ability to do in-house. Don’t know what to do next? Well, there are businesses that do that, too!
Lastly, every team suffers from DOUBT IN YOUR OFFERING. This doubt manifests in a steep drop in performance and productivity with your leadership team (and consequently yourself, too). It only takes a bad month in sales for you to question your life’s work. Do people want your product anymore? Am I relevant? Is what I’m saying really worth anything to anyone? Unless you’re in typewriter sales, if it’s been working for some time, it will probably continue to work. Remain true to your business strategy, stick to your niche, have faith, and keep grinding. As the leader of your organization, it is imperative that you remain durable during times of doubt. The team will be looking up to you for signs of weakness, as that decreases the stability of your organization in the minds of your team. Find a good group that you can discuss these challenges with outside of your organization. Seek counsel from peers that are also dealing with similar issues. Rally together to get through these times of doubt. Also, use this as an opportunity to innovate. Could you adjust your product or offering to greater relevance? Perhaps your doubt is sending blips to your internal radar? Either way, seek advice from those around you.
These are only five of the challenges that all small businesses face, but they are the ones that I believe can cripple your organization without combating them. Take some time out of your day to better understand if you’re currently experiencing some of these issues and create steps to overcome them. One thing’s for sure: doing nothing won’t improve anything.
Are there any critical challenges that I missed? I would love to know if you think there are more important issues facing all small businesses.
