It is well known that dealing with the challenges that impede the growth of a company is not an easy task, but for that reason, it should not be a task to postpone. Many studies indicate that the mortality rate of SMEs is really high in most countries. Because of this, Aaron Rodriguez, an expert in business optimization, discusses in detail what are these challenges that prevent the growth of a company so that entrepreneurs can take appropriate actions and thus cope in a better way.
Statistically, it has been reported that on average, 80% of SMEs fail before they reach five years of age, and 90% do not reach ten years of age, which is disturbing data and can even be a source of fear for those who want to start their own business.
Leading an organization towards business growth is not easy, so Rodriguez has taken on the task of compiling, based on his experience with different clients and companies, what are the problems and challenges faced by a company to grow and be profitable.
The first business challenge has to do with a lack of planning. Many companies work on the fly without a well-defined plan, the lack of which makes it difficult to achieve growth objectives. Therefore, the company leader must give importance to the strategic planning process. This is the job of the company’s managers, who must define the company’s mission, vision, organizational culture, action plans, business objectives, business strategy, and budget.
“The consequences of not planning in companies are reflected in low productivity, low profitability, economic losses, lack of focus, etc.,” Rodriguez explains. “When you plan, you put your company in a position of power and leadership; not doing so, puts you on the opposite side of the scale.”
Other challenges that impede business growth have to do with underestimating the importance of having a good marketing plan. And when Rodriguez talks about “a good plan,” he means one that is primarily focused on customers and business objectives. The marketing department plays a very important role in the business strategy since they are responsible for executing processes and actions that result in generating leads for the sales team.
Rodriguez says, “The marketing plan is essential for those companies that want to monetize the sale of their products or services and gives us a concrete vision of what we really want to do, how we want to do it, and in what time frame we want to do it.”
Designing a marketing plan will make a difference, it not only helps you to know what is going on with the strategy, but it will also give you a clear direction of where you intend to go with your business.
As a consequence of not having a sales plan, the company cannot generate the income it really needs to finance the operation and strategies of the business. The lack of financial resources hinders the company’s ability to invest in its growth.
So, if you want to grow, you need to increase revenues, and this implies investing more, forcing companies to go into debt with banks. Therefore, when allocating resources, we should prioritize the goals and strategies needed to grow the company, instead of sticking to a budget that only limits the company’s growth.
Another challenge that hinders business growth has to do with defining strategies to attract, sell and retain customers and, at the same time, be profitable. This is the basis of the cycle for a company to maintain constant growth.
In many of the companies Rodriguez has encountered, it is all too common for the sales team to still be using old-guard strategies to acquire customers. These strategies include cold calling, visiting companies, sending out mailings with portfolios, handing out business cards, and so on. As a result, the sales goal is not met, the sales team feels frustrated, there is work stress, high salesperson turnover, annoyed prospects, low sales productivity.
As with the marketing plan, many companies do not have a sales plan with well-defined goals and objectives. “Dedicating time to the sales plan will allow the company to grow in a sustainable and safe way. With sales planning, we will be able to support the company’s growth in relation to revenues, know our customers’ needs, establish realistic objectives for the sales team and plan logistics,” Rodriguez assures.
Nowadays, technology plays a leading role in the processes that drive the development and growth of companies; marketing, sales, customer service, operations, etc. These are some of the most important and key processes for a company to enter the digital era.
Resisting change and not entering the digital era will only bring more challenges and difficulties for the company. In the not too distant future, it will be part of the list of companies that have disappeared for not adapting to the Internet era.