5 Reasons Your Business is Struggling with Growth

There are many challenges facing small and medium sized businesses, and it is an undeniable fact that most start ups fail. While there are numerous reasons that businesses struggle with growth and ultimately fail. Here are 5 common reasons, and we look at what you can do about to turn your struggles into growth.
1. Leadership Challenges
As your business grows, and you employ more people, the requirement for leadership skills
also increases. As the business owner you need to ensure that you spend time working ON your business and not as much time working IN your business. If you are not changing how
you run your business, you will struggle with trying to do everything.

How do you address this challenge?
You will need to ensure that you have hired the right people in your team and that you delegate effectively to them. It will not be possible to work the same way you did when
you started out and, if you do, you will become the bottleneck in your company that slows down your ability to get your products or services in front of your customers and make money.

Other solutions include leadership mentoring, coaching, and training to learn how to apply human skills within your organisation and ensure a positive, healthy culture that empowers growth.

2. Lack of Differentiation & Value
Unless your business is extremely specialised, you are probably competing against a lot of
other companies with similar solutions. Unless you can differentiate your products or
services based on a strong value proposition, you will struggle to find success.

How do you address this challenge?
There are a few components that you need to focus on here to improve your business
performance.

The starting place here is to define the purpose of your business:
 Why does it exist?
 What makes your business different?

You need to closely review the industry, market, and competitors to determine what is
being offered, how and what is working and not working. Then apply that lens to your
business to determine where and how you can differentiate your business. This will enable you to define your strong value proposition for your customers.

You should also build your brand. You should have a company identity, logo, tagline, and
colours that deliver the visible aesthetics for your business that will be applied to your
marketing plan. This creates the visible association for all current and potential customers so that they know your brand.

Lastly, you need a marketing plan that reflects your purpose, based on your value
proposition, and uses all the channels that your customers visit to showcase your
company and your differentiated solutions.

3. Lagging Customers’ Needs
Not remaining attuned to your customers current and future needs is another reason that businesses stagnate. Your customers are not static beings, their lives are fluid and their
needs change. Failing at least stay abreast of these changes, if not ahead of them, will result
in your offerings no longer being relevant and your customers moving to your competitors.

How do you address this challenge?
Reviewing local and global trends here is key.

You can also engage in surveys and market research to stay in touch with your
customers. With the advent of global digitisation, you will be able to set up low-cost
research solutions that can give you real answers to your customers’ needs.

In addition, a good Customer Relationship Management tool will be beneficial here.
There are many CRM solutions that you can deploy in your business that will help you
remain in touch with your customers’ needs quickly and efficiently.

4. Unprofitable Business Models
While you may have a fantastic business idea, unless you have a profitable business model
based on a robust business plan in a profit bearing segment you will not be successful.

How do you address this challenge?
Researching the industry and other businesses is the place to start here.

Once you have done that you will need to develop your holistic business plan. You need
to document your business plan:
 If you want to access funding you will need to show a complete business plan, and
 If you are expanding and growing you will need a business plan to direct the business based on the strategic guidelines you have established, so keeping the plan “in our head” will not work.

Your business plan must include:
 Financial forecasting based on sound assumptions for revenue generation
 Strategic planning
 Marketing
 Operations
 Identify possible risks and determine how you will mitigate these risks.
 Detail your critical milestones for the business and your success measures.

5. Poor Financial Management
This is part about “know your numbers” and it critical to your success.

How do you address this challenge?
You must know exactly where your money is always and how you can access contingency
funds if required. You will need to manage cash flow, taxes, payroll, and expenses.
You should first separate your personal and business finances, no matter the size of your
business.

Then consider using professional services account software like QuickBooks or Xero to
manage your financial transactions and generate profit and loss statements (P&L). This is critical to understanding exactly where your business is at any time and keep you
operating in profit.

If you are unsure about how to do this, you should consider hiring a business financial
advisor and potentially a bookkeeper or accountant to help manage your finances.
Just remember that if half the business start-ups fail, then half also succeed.

Starting up and growing your own business is an exciting, and stressful time. Your success
requires a sound business plan that delivers relevant solutions to your target market through an effective business model that is fiscally sound.