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6 Common Challenges Small Businesses Face

challenges small businesses face

As a small business owner, you manage fewer resources and people than larger companies — but that doesn't mean you will encounter fewer challenges. The most notable issue small businesses encounter is keeping their doors open. According to Bureau of Labor Statistics data, approximately 20 of small businesses fail in their first two years.

Understanding the problems you might encounter as a small business owner will help you form an effective plan to overcome them and grow your business successfully.

1. Finding Customers

Every company starts with a need to find customers. People are loyal to brands they've bought from before. Unless you provide a unique item or service that instantly helps you stand out, you must invest resources to locate potential buyers and convince them why you're the best option. Finding customers for your business may be your most significant obstacle in particularly saturated markets.

To find customers for your business, focus on the following strategies:

  1. Determine your ideal customers based on demographics and related data.
  2. Focus on ideas to target the right people by understanding what they do and where they spend their time online.
  3. Based on your findings, create content for your target audience and share it on relevant channels to capture their attention.

2. Increasing Brand Awareness

Even if you offer the best products or services, customers won't buy from you if they don't know you exist. As a small enterprise, you must invest more money to increase brand awareness for your business. Getting your brand visible and in front of customers is the goal.

When increasing brand awareness, focus on building trust with customers — consumers should associate your brand with high-quality products or services and quality customer service. Show them why they should choose your brand over another. Once you've gained their trust, consumers will buy from you and even recommend your brand to others.

3. Generating Leads

Every business needs a high quantity of high-quality leads to increase the chances of converting them into customers. If you don't have any leads, or your leads aren't solid, you'll struggle to nail down customers, and your business's growth will suffer as a result. Because lead generation mainly happens online, your small business should have a well-rounded online presence.

create a website

Create a website with an intuitive user experience, adding compelling content and pages with special offers to entice customers to spend time learning about your business. Additionally, you'll need social media accounts on different platforms, where users can come across your brand naturally and decide to engage with you. Ultimately, making your brand known and easy to interact with can get you started on generating quality leads.

4. Hiring Talented People

As a small business, you might struggle to locate talented staff on a tight hiring budget. However, employing qualified individuals is essential for achieving your goals as a business. With a highly skilled staff on your side, working toward success becomes easier.

If you're unable to offer a competitive salary, aim to make up for that area in other ways, such as allowing employees to work from home or rounding out their compensation with an attractive benefits package. Otherwise, focus on creating a beneficial and supportive work environment. The right approaches can help you stand out to talented workers, no matter your hiring budget.

5. Managing Operations and Workflow

Every team member apart of your small business must understand their daily tasks. This situation can be complex when teams are small and responsibilities are vast — small operations often have workers focusing on many job duties at once, so managers can struggle to find the time to accommodate everyone on their teams. Still, you should take steps to ensure clarity across your workforce so everyone can complete their work successfully.

For example, your business might try the following techniques:

  • Conducting one-on-one meetings with direct reports
  • Scheduling skip-level meetings
  • Offering employee satisfaction surveys

6. Financial Planning

In the early days of a company, you'll need resources to establish a standard of excellence. However, you might encounter cash flow issues that prevent you from moving forward. With such limited resources, companies must focus on financial planning and budgeting to help ensure success.

Taking a step back to analyze your finances is important. Do what you can to cut costs in nonimportant areas, such as downsizing your office space if you only have a five-person team. Additionally, working with a professional can help you make wise spending choices as your business grows.

How Business Consumer Alliance Can Support Your Small Business

When a business starts to experience growth, it's exciting, but it creates some challenges for the company. Every business owner wants their company to succeed, so overcoming potential issues is necessary. At Business Consumer Alliance, we understand the pressure you face, and we can help you tackle common small business struggles along the way.

When you sign up for our membership program, you receive legal, HR and business support, allowing you to focus on meeting customer demands. Additionally, BCA offers comprehensive business solutions to set you up for success. Some of the services you receive include the following:

  • Advertising: We provide solutions enabling you to increase brand awareness through our Sponsored Listings Program, where we advertise your business. Our main focus is on providing tools that help build and maintain your reputation.
  • HR and business advice: We understand that when your business starts, you'll need all the help you can get. Our business and HR advice assists you in navigating issues relating to managing your business and employees.
  • Customer review program: We understand the power of reviews in attracting customers. Our team will contact your current customers and encourage them to post reviews. Through these reviews, more people will feel encouraged to try out your services and products.
  • Unpaid invoice collection: At Business Consumer Alliance, we provide solutions for unpaid invoice collection. We will send your customers courtesy documents and letters to remind them to make payment. You can receive payments more promptly while focusing on other areas of your business.
  • Legal advice: If you encounter legal issues relating to your small business or simply have legal questions about different business areas, BCA can connect you with a qualified legal professional for discounted legal advice.

Trusted Business Membership Services From BCA
trusted membership services

No matter what kind of business you're starting, you should know that you have a rewarding journey ahead. While some obstacles may arise, you can use the right approaches to mitigate them and continue reaching your objectives. By partnering with BCA, you get unparalleled access to an array of support and service options that can help you get your small business up and running.

Business Consumer Alliance is here to help you resolve common small business challenges you might face. Are you ready to reap the benefits of growing your small business with us? Become a member today.

About Business Consumer Alliance Business Consumer Alliance (BCA) is a non-profit company that started in 1928. The broad purpose of BCA is to promote business self-regulation. BCA's mission is achieved by assisting consumers in resolving complaints with businesses and using that complaint information, along with other relevant information such as customer reviews, to forecast business reliability. With community support, BCA can identify trustworthy and ethical businesses and warn the public to avoid unscrupulous businesses whose purpose is to defraud the marketplace. BCA also helps businesses promote themselves by providing services and tools to protect their business and reach out to their customers. BCA obtains its funding from member businesses who support the mission and purpose of the organization and who agree to abide by high standards of ethical business practices.