Unfortunately, the myth of a smooth-sailing startup is just that – a myth. Every business struggles in its first few years, whether with finances, operations, carving out a market niche, retaining customers, etc. Often, businesses will struggle with all of these obstacles.
Your value as a leader, in part, is understanding how to weather this turbulence – how to view obstacles not as setbacks but as opportunities for success. And the first step in making proverbial lemonade from lemons is to be as prepared as possible.
This article outlines three prevalent obstacles every new business faces and explores solutions for how to overcome them. If you are starting to build a company or are reaching that uneasy second year of business, consider the advice below.
Customer Churn
In an interview with Superb Crew, Regan McGee, CEO of the wildly successful Nobul, was asked what milestones his company hit in its first few years. He responded, “Still being here is a milestone in itself.”
“Most companies struggle the first two years,” McGee explaine, but noted that Nobul maintained focus on making its service “as easy and painless as possible for customers.” His answer underlines an evergreen maxim in business: to encourage long-term success, focus on the customer.
A common obstacle new companies face is customer churn, which is a by-product of neglecting a customer-focused strategy. Putting profits at the apex of your business concerns may work as a short-term growth strategy, but it isn’t a viable strategy for fostering loyalty. If you want to expand – and keep – your customer base, you need to place consumers at the center of your business decision-making, constantly asking yourself how you can make each step of the buyer’s journey more engaging, easier and more painless.
Lack of Brand Awareness
How is a business supposed to stand out in a sea of competition? In those first few years, getting your message out to consumers can feel like a David-and-Goliath proposition; you lack the resources to compete with big industry incumbents for consumers’ finite attention.
But you can take a cue from the David and Goliath story. What your fledgling business lacks in spending power, you can make up for in scrappy ingenuity. Build partnerships with local businesses, establish a unique voice on social media, create a compelling company narrative, and – while bigger companies focus on managing a user base – focus on building a community.
Turnover and Turmoil in the Talent Department
One of the most common obstacles a new business faces is building the perfect talent team. When you first start, you build a team out of anyone willing to take a risk on your vision. As you grow and scale, you have to be more selective and discerning with the talent you hire.
According to the influential author Simon Sinek, leading a talented team starts with clarifying your company’s “why.” The argument goes that without a clear statement of purpose and ethos, prospective and current employees are left to focus on the “how” and “what” of your business – the technical elements, in other words. And these technical elements aren’t enough to keep employees, who crave inspiration and purpose.
To attract and retain talent, build your company culture around a collective vision, shared goals and core company values.
If your business is currently facing obstacles, take solace knowing that every successful business has been where you are. Face these common obstacles with grit and creativity, focusing on the consumer, your community and core values.
Interesting Related Article: “How To Create A Buzz When First Opening A Business”