Small Business Growth: Stagnation or Survival
Lately, I’ve been noticing a disturbing trend with small business owners.
There’s a lot of knowledgeable people out there, who are really good at their work, debating whether to continue or not because they aren’t growing.
More often than not, they are losing ground to other local competition who were able to grow, and continually reinvested in their business.
The reasons why businesses fail to continue growing varies wildly. But most long-running small businesses I’ve encountered have a few common traits.
- 1) They rely on referral-based growth, and have neglected web-based marketing for the last few years.
- 2) They are constantly “heads-down” in their work, and haven’t budgeted time to market their business in an increasingly competitive landscape.
- 3) They have not reinvested in their business while their competitors have.
Why Small Businesses Have to Grow To Survive
If your business relies on you to be in it for 10 hours a day, your business is in continual danger of going extinct. I admire the family business or small shops that are one to four people deep. But if one key person has a health issue, that business is suddenly in danger of going extinct.
At the time I’m writing this, my own company is a one-person shop — and I know that’s not where I want it to stay. Like the other small shops I’s describing, everything that needs doing is currently on my plate. For small business owners who aren’t engrossed in web marketing, it seems like there are a million other things more important that need doing. I can see that perspective.
But growing a small business means that you can shift some of those duties off of your plate, and free up your time to take care of those things in your business that have been neglected. Growth is the only way you will get any of that time back, or be able to hire more people to help carry the load.
To Grow, A Business Needs More Customers
To shift work to other people, you need to be able to hire them. To hire them, you need more steady revenue. To get more revenue, you need more customers. To get more customers, you need more leads. To get more leads, you need to get more people into your sales funnel. To get new people in your sales funnel, you need to build awareness.
Awareness and attention is something that you battle your competitors for. Long-standing small businesses that are struggling are usually so caught up in the work that building awareness isn’t even something that they think about until they are at a serious disadvantage.
The businesses that successfully make the transition from small to mid-size or large businesses navigate these challenges. They invest in marketing. They invest in awareness. They invest in new equipment. They hire people to help carry the load. They build a war chest, so that they can survive the lean times. They value referrals, but they don’t rely 100% on them.
Referrals Are Not A Comprehensive Strategy
While I believe referrals are necessary for any business, they only get you so far. Referrals travel person-to-person — one to one. They do not travel one to many.
Today, if people need a service, they generally Google service providers in their area, and determine whether a business can do the job by what they find on their website. Repeat customers can sustain you, but big growth happens when you add layers of marketing and awareness. When a business cannot grow any more by marketing alone, that’s when they pay for advertising.
But many small businesses get stuck at a certain plateau, because they don’t market at all. They may have a website, but they never add any useful information to it. If they have social media accounts, they rarely post anything on them. They don’t see the benefit, because generally, that isn’t the world they grew up in.
But times change.
Social media and blog posts are more than just sitting around waiting to have a conversation with people. These are proactive steps to meet your potential customers where they are at.
Ever look at what people do nowadays? If people have a spare two minutes, they are on their smartphone. It doesn’t matter if they are walking down the street, sitting down to eat, or riding in a car.
Why aren’t you there to meet them? Too busy? Don’t have time for tip-tap-tapping on a keyboard?
Your competitors are finding time to publish on Facebook, YouTube and Instagram. They are finding ways to post information each week on their website that your potential customers were looking for.
Being good at your craft is something that both you and your competitors do. But they are growing and you are not, because they have been making the effort to market to the pool of customers that you both share for a lot longer.
Customers choose them, because they know and trust them already. When customers make a decision, they are going to choose the business they know over the one that they don’t.
Stagnation or Survival
If you’ve had a small business, and you haven’t been putting in the time to meet your customers where they’re at — if you’ve relied 100% on word-of-mouth and you find you’re still losing ground — if you have been busy in The Work for as long as you can remember, but you don’t seem to be getting business like you used to, there’s probably still time.
But you need to make some fundamental changes real soon.
Business has evolved. The Yellow Pages are obsolete. You can’t just throw a few ad dollars at this problem. Not this time.
You will have to get your hands dirty and start being visible online. Small businesses everywhere are facing the choice of stagnation or survival. Which will you choose?