Breaking the Barriers for Business Growth
The economy thrives in the success of business ventures. The creation of jobs increases the purchasing power of the population, thereby keeping the industries alive. However, there are barriers which hinder the growth of small businesses. Its owners should strive to eliminate these obstacles in order to succeed:
Capital is the heart of a business, and the owners must properly manage the circulation of money throughout all the business transactions. If there is a lack of capital, then funding must be sought before embarking on the venture. On the other hand, if the funds suddenly decrease during the course of the business, then it is time to re-assess how the company manages its finances. There are several reasons why the business is losing money:
- Security issues – Are all transactions reported and recorded? Funds should be used strictly for business needs and not for personal purposes. The same thing applies for stock inventory; owners must ensure that money is not lost due to theft or fraudulent transactions.
- Uncollected receivables - Limits should be set for credit and invoices should be sent promptly. There should be a faster way of collecting payments from customers to keep the cash flowing inside the company.
- Company debts – Interests incurred from debts tend to build up easily, contributing to the added loss of money. It is important to pay off debts as soon as possible to avoid the higher expense. If possible, negotiate better terms with the creditors.
- Overstock – Free up the inventory and sell the goods quickly because loaded inventories are sleeping assets. It is better to sell overstocked goods at a lower markup than risk losing its value when it is no longer in demand.
Lack of relevant experience
Not everything can be learned from school, and even the best graduates need training to completely understand their chosen field. The same thing applies to new business managers, they can all benefit from additional guidance from mentors in the industry. Joining business related associations can provide insight from people who have been in the business for years. It is also important to hire people who have the right skills needed to keep the business running properly.
Compliance / Legal Issues
Regulations which are overlooked may cause projects to be cancelled and investments to be closed. All businesses should comply with the state laws and regulations before anything else. It is necessary to acquire all the needed licenses, accreditations, and insurance to prevent legal issues later on. Being fully registered and recognized in the industry prepares the business for growth.
No concrete business plan
To be able to steer the business in a straight direction, there should a clear business plan. The company vision must be clearly defined to the staff and all must work towards it. By dividing the goals into smaller, achievable tasks, the business can constantly move forward. For example, the company may set a sales quota at the end of each month, and gradually increase the target to gain more profit.
Issues that concern one’s family and personal affairs may affect the business if not promptly addressed. Problems regarding health, relationships, and other troubles may reflect on customer service and overall work performance. It would be best if the person concerned seeks help to resolve these matters as soon as possible.
Weak sales is cited one of the major impediments to business growth, according to a study conducted by NFIB research foundation. Poor advertising is the common reason for weak sales. Even the simplest idea could generate sales if combined with effective advertising methods. To boost sales, business owners must identify their target market and bring their ads closer to the customers. There are inexpensive advertising methods such as using car magnets to invite new prospects. Giving out flyers and brochures is also a direct approach to promote the business. The key is in improving the company’s focus, and providing better service to its customers.
By breaking the growth barriers mentioned above, any business would likely achieve its goals and eventually succeed.
- Outdoor Advertising Outperforms Digital Advertising
- Pros and Cons: A Guide on Choosing the Right Advertising Medium for your Business