Start-ups face a lot of challenges on its way to growth. One of the greatest challenges faced is, as the company grows, the older challenges do not disappear. Instead, they become more common.
Business challenges are part and parcel of the entire business cycle. The entrepreneurs can avoid some of the business mistakes, but they ultimately have to overcome the challenges that are associated with developing a business. These challenges lie across every industry, whether it is a product, hiring, marketing, sales, or the several other areas in which the entrepreneurs are working in.
Abdo Riani, the founder and CEO of VisionX Partners, a startup development company that works with entrepreneurs to start, build, market and run their startup shares some of the most common business challenges that are most common among the small and medium-sized businesses. These challenges appear throughout the start-up journey to the idea of growth.
Prove a Business
One of the biggest challenges is to find an idea for the business and prove its existence in the market. A business can only be proven when there is a market for it. It is also important that the customers find your solution useful and adds up with time. All this means you can run a profitable business having a clear direction of generating profits.
The only way to overcome this challenge is to study the competition, knowing your customers, seeking guidance, working with a strong entrepreneurial team, and launching small versions of your product for testing and validation.
Once your product or service gets strong validation signals from the market, and you have made sure that your solution is needed and is used in the market, it is the time to prove that the business is on the growth path. There are three areas in which small and medium-sized business owners need to pay attention to, and these include the Customer Acquisition Cost (CAC), Lifetime Value of the Customer (LTV), and the churn rate.
Initially, you need a lead generating channels that are capable of bringing in consistent streams of potential customers. CAC and LTV cannot be studied without potential customers. It will be wise if the small business owners test a few channels and see what all things are working for potential customers. Having a steady stream will help you start optimizing your key metrics.
It is also important, at this stage, to know what all your customers are saying and doing. There are a number of smart and intelligent tools in the market that will help you to study customer feedback and their needs. These tools help you to ask every new paying user why they have joined you and what do they expect your business to do for you.
Grow your customer support and development team to explore more about your customers and customize your business to stay afloat in the market.
The Phase of Transition
The transition phase will shift your company from a product ort a service with customer interest and a promising growth trajectory to a predictable revenue-generating and scaling business at a healthy margin. Entrepreneurs, at this point in time, must be aware of the growth levers of the business, the reason why customers use their products or services, and the possible reason for customer retention. Answers to these and the use of the top-performing customer acquisition channel will represent your company’s growth.
Additionally, as an entrepreneur, staying focussed is one of the greatest challenges one has to face as you will come across opportunities in a number of areas. You will also see some serious interest from the different investors, partners, and customer segments.
The transition phase will make you realize that no matter how much progress you make as an entrepreneur with one solution for one customer segment using the best performing customer acquisition channel, there will always be some opportunity by doubling down on what is working. All this is done before seeking other solutions, marketing channels, and segments.
Start-ups start growing from the day it was started to an endless journey. They do not reach success overnight. However, there comes a point where a business can see growth opportunities by fuelling proven systems and processes. This also means accelerating customer acquisition, making a considerable marketing investment, increasing the average revenue generated from each customer by carrying out upsells and cross-sells.
A lot of internal challenges can occur when you take your company to the next level. There are several struggles and fears of failure that can occur when you take bigger risks. However, taking risks is the only option you must go for in order to succeed.
Source – Forbes