Small businesses under pressure
During pandemic lockdowns, Victorian Chamber of Commerce & Industry introduced a program to assist recovery and build resilience. It consisted of 8-hours of free mentoring and advice – the business equivalent of speed dating!
As one of the nem appointed mentors, I engaged with dozens of diverse businesses, many of them retailers. Despite their diversity there were some common learnings.
Lack of measurement, despite readily available data.
One business sold on quotation and did not know their quote conversion rate. Unlocking the next level of detail led to changes in their approach to prospective customers.
No regular review of financial performance
Virtually all clients failed to produce and review a monthly set of financial statements. They all owned accounting software but viewed it as only being useful to provide the external accountant with BAS information. The common cry was “I’m okay. I have enough money to pay the bills”. Operating budgets were also scarce.
Poor understanding of customer needs.
Many businesses were so busy with managing their day-to-day activities, they were almost oblivious to what was bringing customers to them. Many assumed that price was the only consideration in the customer decision-making. A few simple questions of prospective customers demonstrated that price is often down the list. An awareness of customer priorities led to changes of approach.
Excessive focus on new customers
Many businesses spent a lot of time chasing new business. Nothing wrong with that. However, they had very little understanding of the untapped potential of their existing customer base. Often the growth you need, plus some, is under your nose. It starts with conversations with them, their needs, their growth plans. And those conversations only cost the price of a coffee.
Your ability to stop the treadmill, review the plentiful information available and adjust your business is not a luxury but a necessity. Many business successes have been the result of lots of hard work, persistence and long hours. More of that won’t often be enough to take the business to the next level. Getting inside the mind of the customer, understanding their needs and how they view you may be the secret key to growth.
Author: Bernie Bicknell, Partner nem Australasia
This article is based on research and opinion available in the public domain.