Only 50% of businesses make it past the 5 year mark. Many of those that do make it past the 5 year mark only manage to limp on, never reaching their full potential. There are hundreds of reasons businesses fail, a huge amount of them are outside of your control as a business owner or senior partner, That leaves a lot of them well within your power to affect.
Business Coaches, Business Angels, support groups, they all exist for a reason. No one wants to see a small business owner fail. All too often there’s someone at the helm steering the business full steam toward a waterfall whilst worrying about the small leak at the aft.
1. You’re Not The Best At Everything!
If you’ve built a business from scratch it can be difficult to let other people start taking responsibility. Your business is your baby. You’ve built it from scratch and who can know it better than you? Probably no one. But they don’t need to know your business like the back of their hand, they just need to know business. It’s always tough to stand back and admit that you need help. In the long run you have to choose between being the captain of your ship, or it’s anchor. There are many things you are good at, you might know your industry better than anyone in the world, that doesn’t mean you have all the expertise needed to make the most of your business.
If you’re in the Steel industry, you might know everything in the world about Steel. Do you know about securing finance for a new premises? Do you know about writing brochure and ad copy? Do you know everything about keeping the accounts running and people being payed? Probably not.
You can’t do everything and recognising that, letting go and allowing other people to take responsibility is part of growing a succesful business. Time and time again I’ve seen business owners come to agencies for help and then try to micro-manage every aspect of a project. They waste time and money devoting their energies to trivial tasks because they cannot let go. It’s simple maths, if it’s your small business then you’re the money person! You’re the one with the ideas, the know-how to be pushing the company forward. What use is it devoting your time to parts of the business you’re not an expert in? None!
2. You Can’t Say No!
A lot of small businesses have the attitude that all business is good business. All exposure is good exposure. Build the brand! Run yourself ragged! A cycle emerges and you burn out. Your resources are stretched, your work suffers and what have you achieved? Part of being a shrewd business person is knowing when to say no.
If a potential client looks like they’re going to be a problem you can say no! As a business and as a person you only have so many resources. Spending those resources on the wrong things will hurt your business.
The business world lives on quid-pro-quo. Learning to navigate this takes time and no one starts an expert. Good will is a great thing to have, but it doesn’t help with pay-roll and it doesn’t complete projects for clients. Learn to pick your battles and don’t be afraid to turn down work you don’t need or can’t handle. Stretch yourself too thin and you suffer, your staff suffer and your clients suffer.
3. You Can’t Compete!
Always remember what makes your business unique. Chances are there’s someone not too far away doing something very similar. Most of the time you simply can’t be the cheapest option, or the fastest option or whatever the ‘option’ is in your industry. This means you can not afford to lose sight of why you have targeted your segment of the market.
If you sell a product Amazon does, why should a customer come to you instead? I doubt you’re offering free next day delivery. What about a streamlined UI, 1-click-shopping and 24/7 customer service?
Let’s be realistic, as a small business you can’t offer any of that. This means you have to focus on your segment, focus on your uniqueness and never lose sight of it. It’s easy to say ‘We’ll have great customer service, always answer emails within an hour and meet at client premises’ in year 1 of your business. Times change, business grow, practices should change too. But if you lose sight of what got you to where you are then you’re playing a dangerous game with your future.
Someone could come out with a similar product or a lower price plan tomorrow, what do you have to stop your ‘loyal’ customers jumping ship?
4. You’re Complacent!
Here’s a story I’ve heard twice this month. Business owners have told us how they’ve suddenly come into a big problem, they need new customers ASAP because they’ve got a huge cash shortfall. But they’ve got no marketing worth mentioning and not a Salesman between them. How does that happen over night?
‘We were doing fine, running well with our long term clients, now a key client has taken their business elsewhere and we’ve lost 20% of our revenue.’
What’s your marketing strategy? Who are your sales team? How is your SEO and PPC running?
‘Oh, we haven’t got any of that.’
I wish I was making this up. The amount of businesses that went under during the last financial crisis because of their complacency is mind boggling. Never get complacent in your businesses progress. Just as you shouldn’t over reach, neither should you stagnate. Ask Yourself if your business could afford to lose any single one of your biggest clients and still continue to run without having to make any changes. If the answer to that is not a resounding yes then you need to do something about it.
Markets crash, people die, legislation changes and new innovations take place. Complacency will kill your business if you let it.
Building your business is a gruelling process. Once you’ve been at the helm for a few years it becomes very easy to lose sight of everything that goes together to make your business successful. Maybe you’re too focussed on the grand vision, maybe you’ve lost that vision and are technically brilliant but paddling in a circle.
Sometimes dead weight has to be cut away from a business and hard decisions have to be made. If you can’t critically assess your business from a detatched standpoint then you could well be hurting your business more than anyone else.