The Top Business Challenges We Face and How to Solve Them
June 29, 2010
We’re interested to know and have each other learn from this topic: “What is your biggest business challenge and how are you overcoming it?” There is a lot of power in sharing your challenges and learning from others in this community blog. So here we go:
What’s the biggest challenge in your business and how are you overcoming it?”
- Is it keeping customers?
- Is it finding new customers?
- Is it marketing and lead generation?
- Is it getting a line of credit?
- Is it managing expenses?
- Is it pricing products?
- Is it time management?
- Other?
Choose the biggest challenge for you – describe it – and then the solutions you invested in or activated to solve the business challenge. Tell us your story and share with others how you achieved success and overcame your business challenge. Possibly others will share ideas with you that you had not thought of.
LaVon Dennistoun, Minneapolis SCORE
View more posts by LaVon Dennistoun
Filed under: Business Planning,Customer Service,Financial,Human Resources,Information Technology,Leadership,Management,Marketing
5 Comments Leave a Comment
1.
Virgil Dissmeyer | June 30, 2010 at 9:59 am
From my counseling experience, the biggest challenge we see is traceable back to a “lack of basic accounting understanding”. Without that it is difficult to control expenses if you can’t read a Profit and Loss, you can’t price properly without knowing your break-even points, you can’t really present a logical request for financing if you don’t know about cash flow, etc.
Accounting is the “language of business” but many do not speak that language.
2.
Kevin Donlin | July 26, 2010 at 5:17 pm
Most small business owners want more revenues, so they chase after new clients. They neglect their current clients — who already trust them — in favor of running ads and promotions to convince strangers to buy.
In my own business, I doubled sales twice in 4 years by focusing on getting current clients to buy more often and refer others. Any competent business owner can do likewise — if they recognize and act on the opportunity.
Ask yourself:
1) What’s your marketing/advertising budget?
2) What’s your client retention budget?
3) Why is 2) so much smaller than 1)?
3.
Susan Fronk | July 26, 2010 at 6:39 pm
Kevin,
My theory is that obtaining new customers is significantly more costly than retaining existing customers. You don’t have to convince existing customers that you have something worth purchasing. That sale has been made.
Now, all you have to do is convince your customers that doing business with you is in their best interest. And, once they are your customer you have access to a lot more information about them that you can use to make sure you satisfy them and make additional sales.
Susan
4.
LaVon Dennistoun | July 27, 2010 at 6:51 am
Kevin — Thank you for your comments. They are very insightful and I would agree with your assumption that creating revenue from the existing client base can be more profitable than creating revenue from new sales. I would guess that this assumption may differ based on the product/service that is being sold. Can you share more detail on your business type and your client referral program? I’d also like to hear more about how you maintain customer satisfaction to continue to build on revenue from your existing clients. In other words – how do you keep them happy so that they buy more and refer more prospects to you?
5.
Kevin Donlin | July 27, 2010 at 12:22 pm
Lavon,
My business was a resume service back in the late 1990s; the principles still hold true today.
I doubled revenue twice in 4 years by using a CRM program (Goldmine), following up at least 3 times with every qualified prospect, and mailing all clients at least once a year with news and/or promotions.
If I were doing it today, I would use Salesforce.com as my CRM and mail clients every month. Not email, snail mail.
I used 10+ different referral methods but the easiest to explain is my formalized referral system.
For every new client you send my way, I’ll discount their order $20 (as a gift from you), pay you $20 cash, or send you a $20 Amazon gift certificate. I settled on these 3 choices after much input from clients.
Any client who referred two or more people was upgraded to Best Client status in my CRM. These people got more mailings, more phone calls, and all-around “rock star” treatment. They responded by referring even more new clients.
To keep clients happy, I tried to over-communicate; that solves most problems when they’re tiny.
Examples: I told clients what to expect at every stage of the process, then told them exactly why I did what I did for them, to resell them on the idea that choosing me was a good idea. Also, I sent them an extensive “user guide” to help them actually use what I created for them. It worked very, very well.
I hope this helps!
Leave a Comment
XHTML: You can use these tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>
TrackBack URL | RSS feed for comments on this post.