10 business challenges in the digital age and how to overcome them
Every new business is faced with several business challenges that determine if it would die, survive, or thrive. Business is dynamic and challenging, the rules to succeed in the digital age are constantly changing, and being able to master the dynamics is important for business survival.
In this digital age, it’s easier to fall out of business, after starting off with a novel idea, than it is easy to sustain one. However, despite the harsh business survival conditions, many businesses that have mastered the challenges faced by businesses in the digital age find it easy to thrive. Here’s a list of 10 business challenges in the digital age and how to overcome come.
Branding can be a major problem for most business owners. Although they understand why they do what they do, they find it difficult to communicate it to their client base, in a way that helps them to stand out and win the hearts of those they intend to serve. As important as a business name might be, it isn’t all that branding is about. Branding involves being able to communicate your unique selling points to your clients, in a way they can relate and engage with.
To overcome the challenge of branding, it would be necessary to study the brands that resonate with you as an individual, and what makes them unique to you. Being able to answer this, will help to put your business in perspective and highlight the things you do differently from them. After finding your unique identity from your competitors, you can make adjustments where necessary. Better still, you can hire a consultant to help with your overall branding needs. This will save you time and get you the brand that keeps your business right in the hearts and minds of those that matter to its success – your customers.
From rent to petty expenses like stationery, you’ll find out that expenses keep draining the cash flow. Cash flow is important for business survival and expansion, and running expenses can be a major challenge to meet up with.
To solve this, after doing a thorough review of your expenses to identify the cancellable ones, you might want to seek collaboration with other business owners. In the case where you need to own office space, try to see if it’s possible to cut back expenses, by sharing the space with other businesses. In the case where all have been reviewed with little result, you might want to consider reaching more clients or increasing your charges on goods or services.
- Economic instability:
Sometimes, the country’s economic situation could be unstable due to different factors. This instability might have a direct impact on a business, by increasing operating costs, or directly affecting the income of your client base.
The best way to manage instability is to make business projections for the worst-case scenario and prepare adequately for it. This allows you to make ample preparation for such a situation, and stay ahead of where others couldn’t thrive.
- Customer Retention:
It quite easy to start a business in this age, but a major challenge most businesses may encounter is customer retention. The ease of starting up a business makes the business so competitive that it could be easier to lose clients than gain them. This factor is usually strengthened by the fact that competitors are out to take from the pool of existing clients. It might be hard to retain customer loyalty, as each customer is often on the look of for the next place with better offer and price.
To solve this challenge, it would require a business owner to be proactive, patient, and strategic in decision making. It’s important to do all you can to make your clients trust you, that way it’s easier to keep them than when you’re aren’t trusted.
- Financial Management:
Most business people find it truly challenging to manage their business finances. For those offering services, it’s even harder. There’s usually a problem of how to price services correctly and sufficiently, manage expenditures, and saving enough for business expansion. Most sole business owners might even find it challenging separating personal finances from that of the businesses.
To solve this, it’s important to see a finance expert who will provide you with detailed information on how to manage business finances. On the other hand, you could also employ different financial applications and software, to help in keeping track of expenses.
It’s common to find businesses faced with the challenge of finding committed and competent staff to run with the vision of the business. On the occasion of finding them, the average business owner operates with the fear of losing competent staff and often wastes more time trying to find the right staff.
This challenge requires being strategic. Most great businesses of today, have found loyal and competent members of staff because they were first loyal to them. Though you might need to go through strict recruitment processes, it’s important to put in place staff welfare policies, that will make them feel valued.
- Digital Innovations:
Digital innovations are on the rise, and most tend to eliminate the need for some services, leaving some business owners without work to do. Most services that were highly paid for in the past, are now highly decentralized and easily accessible to anyone (especially online). This poses a serious challenge to today’s business owner, who isn’t sure how to make the change that will make his services relevant again.
To overcome this, it’s best to move along with change than resist it. Sometimes, it’s important to change business operations altogether or conform to the demands of innovation. Today, for instance, online sales outlets have taken over the relevance of physical stores, and wise owners of these businesses, have also moved their operations online.
Read Also: 8 Ways to Manage Stress as a Business Owner
For most business owners it could be challenging, finding the right marketing strategy to apply. It could be tempting to go for all the available options or do nothing at all. However, marketing is the lifeblood for business survival and it’s important to get it right.
Instead of investing all into marketing at once, it’s best to have an idea of your client pool and where to find them. This allows for concentrated efforts, in that direction. Also, each business owner should study the business niche, and understand the dynamics that govern it. It allows to see patterns of consistency, upon which marketing strategies can be built.
Due to market dynamics, most businesses might find that the initial starting capital may depreciate instead of appreciating. It might be such that the value of the current capital is now much lower than the initial value. These dynamics puts the business at a slower growth rate and poses the need to seek more finances for operation.
At such points, it’s best to seek experts’ help, as insights will help to determine the action steps to take. These steps might involve, taking up partnerships, seeking loans, or increasing customer base depending on the measure that the challenge warrants.
Most business owners are risk-takers and are sometimes uncertain about what the future holds for their business investments. This makes it difficult to go for long-term investments and planning that may be beneficial in the long-run.
In as much as it’s important to be speculative in decision-making, optimism is important for business survival. It’s not the right approach to run a business like it could fold up in the next two years. Optimism based on projections from existing data should be employed to prepare for the future and make informed decisions important to the business’ survival.
The business environment is dynamic and evolving, as more businesses face more challenges in the digital age, which makes the business space a tussle for survival. However, despite these challenges, there are major solutions that could make a business move from surviving to thriving. Once businesses can identify what works for them, thriving would be an achievable feat.
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