Challenges and Strategies in 2018
Across sectors, small businesses continue to face challenges in 2018; namely increased competition from global chains, and technology-driven commoditisation of products/services and consumer comfort with online sales.
For some, trying to compete against this changing world and its economies of scale seems unsustainable. But challenges are also opportunities and in 2018 the winners will be those who differentiate themselves in the market, by delivering highest quality personalised service and products by focusing on some key areas.
- Customer service – Loyal customers are a competitive edge in a corporate retail and online environment. So don’t get complacent about customer service which will only make you vulnerable to the convenience and price advantages of the corporate/online players. Focus on delivering the ‘wow’ factor, offering your customers a highly personalised, interesting and excellent experience that will enhance their sense of value and give them a good story to tell. You sell an experience, not a commodity.
- Business management – The old adage of working on the business not in it still rings very true. Yet, many owner-operated businesses still spend most of their time in day-to-day operational tasks, to the detriment of the long-term business. Take time to manage the business – financial planning, reviewing the effectiveness of systems and processes such as customer service, staff training, and addressing long-term strategic needs, risks and opportunities.
- Pricing structures – Suppliers are struggling as much as anyone so will be open to negotiation to be competitive. It comes down to getting a price that’s good business for both parties, achieving the best possible margin available considering the source of the product or service and what it can be sold for in the market.
- Internet presence – Around 49 percent of New Zealand small and medium-sized enterprises (SMEs) still do not have a website. That’s a shocking stat. A good quality web presence is critical in today’s world – that is where people find out about you and communicate with you. Social media platforms also play an important role in creating an online presence – it is estimated by 2019 there will be approximately. 2.77 billion social media users around the globe. Social media for small to medium businesses has the ability to increase website traffic, as not only do social media sites help drive traffic to your website, but the more shares your social media receives the higher your business will rank online. Without a quality internet presence you’re not only missing out competitively in terms of branding, but are also losing out on opportunities to connect better with customers and build online sales and services.
- Community involvement – As a local business, another competitive edge you can build on over the global and national retail chains is getting involved in your community, helping building a level of visibility, connection and reputation that is difficult for the chains to replicate.
Overall, there is a lot to be positive about in 2018. There doesn’t appear to be any sign yet of the forecast instability in the economy post-election, the dollar is strong ensuring purchasing costs remain stable, and generally our primary sectors are doing well. Opportunity is knocking.