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Monday, February 18, 2013

The Biggest Challenges Growing Your Small Business

While starting a business can be an exciting and fulfilling experience, the real test arises when it reaches the key inflection point for growth. The following challenges of business growth deserve serious attention.

Funds

Funds are very critical to promote growth in a business. It is important for start-ups to have a solid business plan to acquire any financing. Cash is the lifeblood of any business. Managing cash flow is very important for businesses to avoid illiquidity and, even, bankruptcy.

Customer Base

Businesses exist due to customers. Identifying customer and prospect pipelines proactively and growing the customer base is definitely a challenge. Developing a successful marketing strategy is a crucial factor to build a large customer base.

Market Conditions

One of the key challenges lies is in taking business decisions with changing market conditions. Investing in new and relevant technology is very necessary to stay competitive in today’s business world. Innovations help accelerate business expansion. It is a necessity to work on your existing product/service alignment with the market and at the same time, invest in innovation to build a stream of new, profitable products to market.

People

Hiring right people, good people management and effective leadership are vital for operational efficiency required for sustained growth.

To put it more simply.....

1. First challenge is identifying on where to grow your business. When people start their business first- they shoot in all different directions. I believe(based on personal experience) it is good to identify your IDEAL TARGET CLIENT and then focus all your energy and time towards them. So in short, the first challenge is PROPER PROSPECTING

2. Following up properly - When working for a company, there are multiple departments each responsible for different things. However as a business owner or entrepreneur one has to wear many hats. This sometimes could conflict with managing your communication with your customers and prospects. It is important to put the time spent with clients and prospects as a first priority

3. People - dealing with the right people internally and externally. There are lots of people willing to work with you- however you have to find out who is best-suited. Many times this becomes trial and error.

The above is not necessarily intended to be an all inclusive list. But it will help you focus your efforts for your small business.

1 comment:

Shari said...

I run a relatively small construction company specializing predominantly in home improvements and I have to say that the MOST important challenge to such a business is following up with customers! I know you put that as #2, after identifying your target market. But if you don't communicate with your customers and leads, you will lose both. General contractors, in general, make this mistake all too often. Furthermore, customers want to hear directly from their general contractor -- not the office manager -- to hear the details of a current or upcoming renovation. This is the MOST FRUSTRATING aspect for me and for the customers. These customers are making what they believe to be HUGE investments (whether it's $2,000 or $20,000 or $200,000) and the process is disrupting their homes and their lives. Good communication accompanied by good workmanship will bring those customers back in the future and can provide well-qualified lead generation. Poor communication even coupled with good workmanship leaves a bad taste in the customer's mouth and does nothing for future business.