Owning a business can seem like the ultimate American dream realized. With abounding stories of entrepreneurs who strike rich before the age of thirty, it’s easy to understand the appeal of owning your own business. But what happens when your business starts to fail?
If your business is failing, sadly you aren't alone. According to the U.S. Census Bureau, American business deaths now outnumber business births, with over 470,000 businesses dying per year.
Don't let your small business join the millions that have gone under. Here are eight reasons why your small business is failing — and how you can remedy them.
Problem #1: You have a website — but it isn't customer-centric.
The website has been built to your personal preference without taking into account the wants and needs of your target audience. Furthermore, you haven't done search engine optimization (SEO) for your website, and the number of views is decreasing by the minute.
Make sure you undertake market research as well as regular surveys with your customers to ensure that your website meets their needs. Read up on basic SEO if you prefer to maintain your website by yourself, or consider investing in an SEO consultant who can properly optimize your website.
Problem #2: Your small business does not have any clear branding.
Instead of a brand that tells a story, you have a series of disjointed messages and an inconsistent branding policy. Even worse, you spent thousands of dollars hiring a graphic designer to create a flashy logo that does nothing to convey your brand to customers.
Solution: The first step in small business branding is to understand your small business.
What is your story? Who are your target customers? Why is your product or service different from similar competitors? What problem are you providing a solution for? Figuring out the answers to these questions will allow you to create a coherent brand message.
Problem #3: You spent a small fortune on marketing without having a marketing strategy in place.
You were convinced that your small business had to invest in billboard advertisements and Snapchat, even though your target customers are aged 35-50 and find out about new services and products through word-of-mouth referrals.
If you decide to meet with a consultant, you'll be able to bring ideas they can walk through with you — ask them how you can promote your business online through email, local search and more? And with some knowledge of your own, you won't get fooled by a lot of buzzwords.
Problem #4: You haven't cultivated relationships with the local community and other small businesses and you have no name recognition as a result.
This is especially prevalent among businesses in small towns, where a survey conducted by Small Biz Survival found that over 12% of participants cited negativity and a lack of cooperation among local leaders.
Solution: Seek out other small businesses who have already started working together.
Arrange a meeting to discuss your desire to partner with the local community and how you can all work together. Holding local events are a great way to create some buzz throughout the local community and attract new customers. Small businesses can greatly benefit from cooperating with other small businesses to gain brand awareness and attract new customers — don't be fooled into thinking you can't work together.
Problem #5: The last time you updated your small business's social media pages was 6 months ago.
You thought it would be easy to keep them updated before realizing how much time and energy it actually takes up.
Solution: Inconsistency will not engage your audience, nor will it attract new customers. Realize that social media for business is an investment like any other part of your business.
Take the time to figure out which social media networks would fit best with your company and brand, and the best times to post to those networks. For example, if your product or service is highly aesthetic, Instagram is a great network to use. Or, you may be better off just focusing on Facebook, and even running some ads to grow your audience. Ask yourself how much time you can devote to creating content for your social media account(s) — including posting and responding to comments and queries — and don't over commit.
Problem #6: Investing in quality employees has not been a priority and your high turnover is becoming cause for concern.
Needless to say, you cannot run a successful small business without hiring the right people.
Solution: While diligent hiring can be hard to master, especially when competing with larger businesses, it's crucial to a company's success.
Try to create job descriptions that accurately convey daily duties. Make your company enticing and embrace the perks of being a small business, too — offer flexible work hours and the opportunity to advance quickly. Playing up the strengths of your company will attract people that believe in your service or product.
Problem #7: Your business expenses have been rising every year and you're at a loss over how to control them.
Remember to pay attention to costs that may not seem intuitive, such as out-of-town business travel, meals, and gas mileage expenses. In addition to this, review your variable costs and see how you can reduce or control them. Try to find utility plans that ensure fixed costs for essential services.
Problem #8: Unpaid invoices are piling up and you haven't followed up on any of them to get payment.
It's taking a toll on your cash flow and you need to do something about the situation quickly.
Solution: Create a strategy on how to deal with late-paying clients.
Will you create a specific policy that determines how many reminders and phone calls you need to make to your client before they pay? Or will you hire someone specifically to take care of any finance-related obligations? Whichever method you choose to use, be firm about enforcing it.
Alice Williams has an MA in Communication Studies with an emphasis in corporate communication and organizational communication. She writes on business, tech, HR and social media and contributes to a variety of online publications.