Six Challenges Facing Business Owners

Having spent the last few weeks meeting with and chatting to small business owners around Essex, it became clear that they all seem to face similar challenges on a day-to-day basis.

As I expected, they are all time poor and there was an ongoing sense from these company owners or directors that they should be ‘hands on’ and across every facet of their business. But, as they told me, they may know all about their business but sometimes they need expert support and guidance to ensure their company grows and increases profitability.

Some of the challenges they faced included:

Customers
Customers are at the heart of any business. Without customers and the revenue generated then the business becomes just a good idea. One of the main challenges they faced was how to attract, retain and maximise their customers?

For me, the key to winning new business and ensuring customer retention is providing not only great products or services but adding a great customer service experience. A strategy needs to be developed for ensuring this customer growth and maximizing revenues from existing customers.

Marketing
Many business owners are not marketing experts and need strategic advice when it comes to developing a business positioning, a marketing plan, a campaign and thinking about the channels they wish to promote their business through.

The challenge is to enable the business to tell its story in a way that enables the business to grow and build customer engagement. Bringing an experienced marketer into the business either in-house or as a consultant to help develop this strategy can allow the business owner to focus on what he does best.

Time
For many business owners there are simply not enough hours in a day. All owners are stretched for time. Creating more time means sometimes saying no and focussing on what is essential for the success of the business.

This is where business owner often seek external advice from a business mentor or consultant to get them to focus on what is critical for the development of the business.

Financial Management
It is imperative for a small or medium-sized business to manage their cashflow effectively but sometimes managing the P&L seemed to be the third or fourth ‘order of the day’ for some business owners.

Getting good financial advice from a consultant who takes the time to analyse business performance, looks at aged debtors, analyses client profitability and puts effective financial planning measures in place mitigates the risk of the business getting into financial troubles.

Profitability
Business Planning seemed to be a bit of an afterthought for some of the business owners I spoke with, they were working more ‘on the fly’. Annual Planning should start a minimum of four months before the end of the financial year and should start with a formal annual budget, understanding the profitability of each client/customer, growth opportunities, business development planning and an analysis of the overheads required to service those clients/customers, market and grow the business, generate a great customer experience as well as delivering a sustainable profit margin.

Successful business owners create wealth and grow their business because they understand how to build a culture where sustainable profitability is a given.

Processes
Many business owners are not across all the processes involved in running a business so the challenge is to make the processes involved in running a business simpler. This is where an external consultant or expert support can prove highly beneficial.

Failure to manage processes such as sales, marketing, business development, building customer loyalty, operational management, HR and employee development can lead to businesses failing. Being stretched across business functions is not the best way for business owners to develop their business.

Three Social Media Trends Impacting Face to Face Business Networking

At first, social media was purely social. And then businesses discovered the power of social networking. They jumped on board, made some mistakes and finally settled down to make a serious impact on their bottom line. All this happened a long, long time in the past… at least six months ago. The use of social media for businesses is still in its infancy and is obviously still in rapid evolution. There is plenty of analysis on what impact social media is having on business, marketing and sales. What about the impact that online, social networking is having on face to face business networking?

They Haven’t Integrated It
A study by SmartBrief, an online media company that aggregates industry newsletters, surveyed 3,000 online businesses shows that the vast majority have been using it for less than 18 months. They are probably still learning how to use the ever-changing features and interfaces. The “computer” part of it is probably still in the way of using social media for making personal connections and communicating more directly with customers and clients. While the front-running adopters are now making social media an integrated part of their marketing, sales and networking programs, the rest are still learning the process much less the personal nuances of relationship-building using social media tools.

Confidence Takes Time
In the same survey, the majority of companies who had been in social media for 2 or more years said they felt confident with their strategies. But only 10% of those who had been in it for 18 months or less felt confident. For those who are new to networking whether it is online or in person, this shows that there is a learning curve. We can assume that those who felt confident have been working on their social media on a consistent basis. Since no one has done a study of confidence levels on personal networking, perhaps we can use this as a benchmark and say that 12 to 18 months of steady effort is a reasonable guideline for building business to business networking skills.

Broadcasting Not Connecting
Another very interesting part of the research showed that while a majority of long-term users felt confident with their program, they were still using it more like advertising and less like networking. More of them were interested in increasing traffic to their website and building brand awareness than listening to and identifying customer needs. This has been an age-old problem with face to face networking and it doesn’t seem that the social networking experience – at least right now – is going to help train us to be less sales-oriented and more relationship-oriented in our personal networking either.

While many companies and blogs are focused on looking forward at how social media is impacting business, it’s interesting to look back and see how social networking influences and impacts our personal, face to face networking. Looks like it is still evolving, but heading to an interesting place.

Can Twitter Replace Face To Face Business Networking?

I’ve been a passionate business networker for many years and have really benefited from this low cost method of marketing my business. I don’t advertise my business, I don’t push out flyers all I do is network. Over the years I’ve built up many contacts and these trusted business relationships have delivered a continuous flow of referrals that have kept my business running.

There are techniques and principles to being a successful business networker and what I’m finding interesting is that a lot of these same rules apply not only to face to face business networking but also to the social networking site Twitter. I make the distinction between Twitter and other social networking sites such as Facebook or LinkedIn because with Twitter you can strike up a conversation quickly without the other party feeling pressured or threatened. It’s as though people who tweet accept the fact that they are in the business of having conversations.

To give you an example of what I mean. If somebody sent you an in-mail through LinkedIn effectively just touting their services, how would you feel? If you’re anything like me your reaction would be something along the lines of “what gives you the right to invade my space when I haven’t asked for it” or “this is pretty much like cold calling”.

Consider that you are at a business networking meeting and someone approached you and introduces themselves, in that environment you wouldn’t feel out of your comfort zone at all because that’s what business networking is all about and it’s ultimately why you are in the room in the first place.

The same applies to Twitter albeit its a virtual room and some of the techniques for meeting like minded individuals differ but effectively by Tweeting and responding to Tweets you are building up relationships and telling people about yourself. If someone you’ve never even heard of before sends you an @message do you feel threatened or offended? I think most people will answer that question with a “no”.

So the process of introducing yourself to others is pretty similar and some would argue even easier than face to face business networking because you are hiding behind your computer and once contact has been made, so begins the process of building the relationship and getting to know like and trust one another.

The same rule applies here whether you are on Twitter or working the room at your local business networking events and that is, do not sell. The sale comes a lot later down the line and if you sell you are selling to one individual who’s right in front of you (physically or virtually) and frankly at this early stage you really don’ have a clue whether they are interested in your products or services at all. These first exchanges are all about sharing information and finding things that you have in common as this forms part of the trust building process.

The interesting point about Twitter is that you can pre-empt this first phase by using the Twitter search facility to find people who are right in your business niche so these first exchanges although still very much on the relationship building level can actually be a lot more targeted that perhaps you first thought. If you think of Twitter as targeted business networking maybe you too can see how Twitter could overtake the face to face element.