I had a conversation with a business owner friend the other day. My friend’s family has a whole chain of restaurants and cafés, some of which he manages. He has no trouble putting up a business of his own because: one, he can simply inherit his family’s trade, and two, the guy’s rich enough to start his own high-end hotel.
However, what struck me was his unbending decision to stick to our small French hometown instead of seeking a wider customer base and higher challenges in bigger cities. I eventually understood why he prefers being a big fish in a small pond: the money is here.
A monumental challenge for small businesses is competing with well-entrenched, established corporations in the same industry. Unless your local business is unique and becomes an instant hit, consumers will choose the well-loved over the newbie that’s doing things others have done before.
This is my friend’s strategy: you look at your hometown, analyze what big city element it’s missing, create a business surrounding that, and make money. Competition is lesser, but of course you should open something lucrative, something many will love. At the same time, it’s paramount to get into a business you enjoy and are adept at. Otherwise, you’ll be stuck with something you’re reluctant to pursue and it just won’t work.
Biggest Challenges Small Businesses Face
- Getting and keeping customers is a constant challenge — with every day, week and month a feast or famine scenario. A good solution is to create a network of loyal clients. This is the secret to keeping a business alive and kicking.
- You also must have enough funds backing you. Economic incentives and programs are out there, but many businesses don’t qualify. Smaller businesses find it hard to create credit and finances that will secure business loans needed to make the company grow. Keep in mind that to make this work, you must have all the right financing options, and research about their pros and cons.
- Hiring employees that will help you grow your business is essential, but the thing is there’s competition in this area because large businesses also need a competent talent pool. The solution is to find out what employees want and make them feel they can grow with you. Come up with creative ways to attract these talents.
- The economy itself is a huge challenge for businesses big and small. The economical crisis is making it difficult for people to spend their money, which is why you should market your business as “‘different and better” than all other establishments. People will get the notion that they will receive advantages that no other company can provide in this tough economy.
- Too many SMBs spend money on a myriad of marketing schemes that they know nothing about. There’s a common notion that when something’s new, it must be an appropriate business strategy. Before investing in SEO, online advertising and social media, businesses must understand who it is they’re targeting and if the online world is where the party is.
Online Marketing Challenges
Even as online marketing has progressed to a full-blown marketing strategy, a multitude of small businesses still haven’t tapped into this profitable advertising tactic. Some who do have a website abandon their online presence at some point and stop updating their internet profiles. One reason may be that small business owners become discouraged when they don’t see results right away.
Before giving up on web promotion, SMBs must understand that this is a new playing field with different rules and mechanics. These small businesses fail because they can’t solve a combination of challenges in online marketing.
- The moment a business decides to enter the online world, the very first challenge is creating a reliable website. A good designer can accomplish this, but a high-quality website is more than just visual attraction; it should also function smoothly and be designed for carrying out business.
- After the website comes its content, and it should be valuable content, the kind that will attract readers and internet users interested in your services or products.
Content creation can be a challenge because it requires skills and expertise, whether the content is in the form of written articles, videos or images. Not all business owners have these kinds of skills, so the best solution is to hire professional who will create the content for you.
- So many small businesses have been suckered in by online gurus that claim to bring the best ROI and so much traffic in a short period of time. Some of these digital marketing companies are misguided and use obsolete methods; others are downright con men.
If you don’t want to end up with a company that sells snake oil, do your research. Do they publish new posts on their website? Are their social networks updated? Does their website support mobile devices? Does the company perform the SEO and online marketing practices they are preaching? Whether it’s an individual or a company, ask around for references. The internet is full of reviews. Check if their clients have actually topped the front page.
- For many small businesses venturing into the online world, the real challenge is failing to set goals. When you do things simply because your competitors are doing it, you will lose purpose. Online marketing is similar to other forms of marketing in that you need to identify your target demographic, what tools to use, and which tactics to apply. Once SMBs join the online promotion band wagon, they often focus on tactics and tools right away without consider overall marketing goals.
Answer questions like: Should I be using online media? What tactic is the best way to increase value for my customers? What type of content should I create to improve engagement? What social networking sites are my target audience using?
- Generating and converting leads can be a real challenge because most customers don’t buy stuff the first time they visit a website. What you need is developing a relationship with them and opportunities to contact them.
You will not run out of ways to generate leads, but some of the most common methods is providing free content, such as webinars, reports, videos and ebooks in exchange of a phone number or email address. This will help you generate leads that will potentially become customers.
Turning these leads into customers, however, isn’t easy because actual online business involves a great deal of trust, respect and credibility from your prospects. Earning your customers’ trust takes compelling them to think you’re an authority and you can accomplish this by educating them. If people are visiting your site for the purpose of learning, this is the point where you are considered an authority. Thus, they’ll trust you enough to buy your products or services.
These are just some of the countless number of difficulties troubling small businesses. Feel free to add other challenges that weren’t included.