The content of this article is provided for informational purposes only. You should always obtain independent business, tax, financial, and legal advice before making any business decision.
Being a small business owner is the very definition of “wearing many hats.” On any given day (or even within the same hour), you’re the marketing guru, the IT director, the office manager, the customer service rep… and the list goes on.
Every function of your business comes with its own set of challenges. Fortunately, there’s usually an answer for every question — even for the toughest small business challenges.
Operating in the digital world? Online business owners may experience varying challenges compared to their brick-and-mortar counterparts. Here are some factors to keep in mind:
From connecting with customers to creating efficiencies, we’ll break down some common challenges of entrepreneurship. No matter what stage of business you’re in, using this guide can help conquer the business challenges that may come your way — both in person and online.
Among the many marketing challenges for small businesses, creating meaningful, lasting connections is often at the top of the list. Use these tips to help build customer relationships:
Small business owners tell us all the time that they cast a wide net to find anyone who could be a customer. There are two problems with this approach: First, it spreads your limited marketing resources too thin. Second, by targeting everyone and anyone, you may reach the wrong clients.
Here’s how to find the right ones: Review your current client list and choose the clients that you like the best and enjoy working with most. Then list the reasons why you enjoy working with them. Those are the characteristics of the prospects that you’ll target going forward.
You don’t need to be on every social channel — you just need to be on the ones where your customers are most active. Ask them which social media platforms they use, both personally and professionally.
How did they find you? Where do they go for answers to their questions? Focus your marketing programs on the most relevant ones. Learn more about the power of tapping into social media.
A customer relationship management (CRM) system may be able to automate how you keep track of customers more effectively than a spreadsheet or a bunch of scattered emails. A good CRM system can show you what your customers need from your business, how you’ve solved problems in the past, and when you last contacted them with promotions and outreach. Check out systems like Zoho, Insightly, and Copper to start.
Once you’ve found your customers, how can you maintain those connections over time? Consider these starting points:
You’re never just marketing and selling — you’re making connections. Create strategies to reach out to customers on a regular basis, perhaps quarterly, whether on social media or at in-person events. Schedule a free customer event at your location. Offer samples, training, demonstrations, and free products.
Delivering an effortless experience is likely what keeps customers happy and coming back for more. The truest test of loyalty is when something goes wrong. By exceeding customer expectations and offering a flawless service interaction, you can directly impact the likelihood of customers repurchasing your product or service. Use survey software like SurveyMonkey to find out from your customers where you can be doing better.
What were customers buying from you last year that aren't buying as much this year? What products are your best sellers? Consider hiring a consultant to dig into your data and provide answers to these questions. If you have a CRM system, you can gather information about your customers to target promotions and other outreach to them.
How many hours do business owners work? The short answer: A lot. It’s no wonder that time management can be one of the biggest challenges faced by small businesses.
If this sounds like you, here are some strategies:
Think about when your brain is most and least sharp. Build a new schedule with your most challenging tasks at the time of day when you're most sharp. You can budget time for functions like marketing, accounting, and product development. Sometimes that means closing doors and shutting off email and devices so you can focus on the critical work of building your business — without getting distracted by tasks that can wait.
Not only can you not do everything at once, but you also can’t do it perfectly. Find experts who can take on the jobs you don’t want to (or shouldn’t) do. Then take all your newly available time and devote it to sales, marketing, hiring, and other activities to help grow your business.
Every small business owner has a never-ending to-do list. It’s easy to get caught up in the frenzy without truly understanding which of your actions are generating results. Take five minutes per week, one hour per month, and two hours per quarter to step away from activity and pause and reflect. Do your actions = results? If not, change your actions.
One more of the biggest challenges for small business owners? Finding ways to work more efficiently. You can start by:
If you run a real-world storefront, you need fast and easy ways for customers to pay for services using multiple payment methods — not just credit cards but digital wallets like PayPal. If you also sell online, you need a POS system that’s integrated with your brick-and-mortar store so that customer transactions and inventory are all in one place.
If you have more than five employees, a cloud-based HR system can help you move away from paper files and clunky spreadsheets. Many of these systems integrate with payroll, making payday efficient. Consider Namely, Bamboo, or Zenefits and ask for online demos.
You need data — not just estimates of how many products you’ve sold or how much revenue you took in. Look for systems that can generate easy-to-understand snapshots of how your business is doing day to day, month to month, and year to year. Ask your software provider or a consultant to recommend a good reporting tool that works with your business systems.
When it comes to taxes and healthcare costs, speak with a trusted adviser, such as an accountant familiar with your specific line of work. Here are a few more helpful tips:
Review last year's tax returns and update your accountant on what you've been doing this year. What can you do to help minimize your taxes? Improve profitability? Your accountant can tell you whether incorporating is a good move for you, and how you can take advantage of tax credits and incentives that could save you money.
Managing healthcare costs is a big worry for small business owners. Research benefits consulting firms in your area and invite two of them in separately to review your health insurance, retirement plans and other benefits. Compare their advice to what your current benefits firm is doing and give them a chance to respond.
Make contingency plans now, and you’ll be better prepared for unexpected events. For example, make sure you have at least six months of cash in your bank. If you experience a revenue shortfall, where might you find emergency funding? If you lose employees at a peak time, how can you shore up your workforce? Always have a plan B for when times get tough. Not sure where to get started? Check out this business continuity plan template.
Looking for more practical strategies? No matter what kind of small business you're running, there are certain responsibilities that all business owners share.
From keeping track of finances and following legal requirements to delivering top-notch products or services, here’s what should be at the top of your list:
Discover more ways to reach your business growth goals and ensure long-term success for your small business.
In partnership with three expert business owners, the PayPal Bootcamp includes practical checklists and a short video loaded with tips to help take your business to the next level.
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