3 Biggest Small Business Challenges for the rest of 2015

| June 23, 2015

Overall, only 57 percent of businesses expect revenue growth for 2015. Many challcafe owner enges facing businesses over the years remain fundamentally the same.

Recently, Wasp Barcode Technologies conducted a small-business survey with 1,000 participants, ranging from small-business owners, C-level executives, and senior management from most business segments, including government. The survey gives insight into small-businesses perceptions on business economic conditions.

When asked about the three biggest challenges facing small businesses today, the survey results were growing revenue, hiring employees and increasing profit. Fourth on the list was a three-way tie between government regulation, employment healthcare and cash flow.

We will focus on the top three.

1. Growing revenue

How do businesses expect to grow their revenue? Of those surveyed, 56 percent stated that improving salon workerscustomer experience and retention was key to furthering success in 2015. Rounding out the top three responses, 45 percent said new customer acquisitions and 28 percent said entering new markets. Here are some cautions to consider when retaining customers and deepening relationships:

  • Avoid focusing only on a couple of major accounts or relationships. In such cases, these relationships control a large portion of your company’s revenue. This becomes very risky and can have a negative impact on your business should the relationship change. Legacy clients remain an important aspect for small businesses; however, having a diversified clientele will provide a wider bandwidth of stability providing motivation for your employees.
  • Who is your target market? Learn to define who this group is, where they spend their time and what products and services they desire. Try not to use a social-media shotgun method. Remember, you don’t have to be on every social media known to man to attract your clientele. Pick and choose the channels that entice your target market while managing your marketing costs. Know your audience.
  • Small-business owners have a tendency to personally manage every client relationship. Unfortunately, it is usually this personal engagement and attention that makes a business semi-successful. Therefore, many small business owners often find themselves tied to habits which can be a detriment over the company’s growth. Therefore, consider what is best for the growth of the business and its clients.

2. Hiring practices

When asked what hiring plans are for the next 12 months, 50 percent of businesses expected to remainshutterstock_113714107 at the same level of employment, while nearly 38 percent expected to hire new employees in 2015. Hiring remains a challenge for small businesses as they anticipate growth while managing overhead costs. This concern seems to remain a dilemma for small business owners wanting to see appreciative improvement in revenue. Here are some thoughts from the 2015 Talent Trend when recruiting talent.

  • 70 percent of the U.S. workforce is passive talent, which means having a job and not actively looking, so seeking this talent should increase the number of qualified candidates.
  • 66 percent of the U.S. workforce turns to personal connections and online channels when seeking jobs. Online job boards and social professional networks round out the top three methods. So, promoting your company through these channels makes your business more visible to potential qualified candidates.
  • 56 percent of the U.S. workforce seeks better compensation packages. Better work/life balance and a better place to work were the second and third aspects noted as most important for those considering new opportunities.

Only 30 percent of professionals exploring job opportunities are dissatisfied in their current roles. Small business will have to compete for the best talent. So create unforgettable candidate experience for desirable talent.

3. Increasing profit

Profit was ranked third as the biggest challenges facing small businesses today. Here are a few girl points upconsiderations going forward:

  • Create a business plan. This seems easy enough, but you would be surprised at how many businesses struggle because they did not create a plan for success. Time is valuable, so having a plan of execution is essential to streamlining the goals to generating profit.
  • Competitive pricing is an important part of cash flow. Do your homework over how the competition is pricing their products in the market. Make sure to create a financial forecast to minimize the potential for shortfalls. If raising prices is necessary, doing so without losing customers takes some discretion. Raising the price slowly may make the changes more agreeable. Make sure to express the intended value to customers as well.
  • Over 61 percent of small businesses stated they utilize social media as a marketing platform, yet participants stated only 11 percent of their business was generated online. Engaging in channels to enhance your business is a must in today’s society. Consumer expectations are higher than ever over convenience and service. Providing the right channels of engagement is essential. Again, knowing which channels you should invest in, then managing the investment is a challenge. Remember, you don’t need to engage all channels to reach your customers.

Challenges will continue to test the resiliency of small businesses. Issues over revenue, hiring and profit remain top of mind. As business owners, we have to be prepared to plan for success. Visualize your strategy to create a plan that will provide clear vision in pursuing business goals.

 

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Category: business management

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