3 Early Warning Signs that Your Business Is In Trouble
3 Early Warning Signs that Your Business Is In Trouble
Like when your clothes start feeling a little too tight, indicating that you are either gaining weight or that your clothes are shrinking, our businesses also give us some signs that we need to be changing what we are doing or else we will be going out of business before we know it.
My job as a small business marketing consultant makes me focus on what is going on with respect to people and their buying behavior. I also look at how businesses go about finding a way to satisfy the needs and wants of consumers. With that focus, I offer three early warning signs that your business is in trouble.
The first is what you are offering can be bought by someone online through places like Amazon.
Having just moved, and still sorting out boxes, I can tell you that there is a need for so many things and so little time to take care of everything. You start opting for solutions that may cost a little more but offer a convenience factor that makes it worth it.
For example, our new house is larger than our old place and we need to get some extra items that we didn’t have before. While we have gotten the bigger items at stores, other items, like electrical cords, and some electronics, are easier to just go on Amazon and buy, knowing they will be there in a few days.
Could we have gotten some of them for cheaper at a local store? You bet. But the hassle factor is too much, at least for me.
Now, if you think your profession is safe from being Amazoned, think again.
Online retailers are getting better at meeting the needs of consumers and offering guarantees, like free returns, that make the risk worth taking.
So, if you are in one of those types of businesses, you better get cracking on ways to match the need that consumers have with an improvement over what they will get online. And yes, your margins may be squeezed, but a margin is better than no margin.
The second is that you stop putting money back in the business to either expand what you are doing or stop maintaining your facilities.
All of us have gone into a business and can immediately tell if it is run down and worn out. The place has a feel that makes us not want to spend too much time, and more importantly, money there.
It is like the business has basically given up on what it started out to do and is now just fading away into oblivion.
You can see a bigger case of this with some of the shopping centers and plazas that litter most communities. They look run down and the cheaper rent the store is paying is probably not worth the lost revenue from people choosing to go somewhere else.
If you are happy with how things look, it is best to have someone who isn’t afraid to tell you what they think to come in and give you a perspective that you might not want to hear, but you need to hear.
The third is that you aren’t putting any money or effort into marketing.
Now, this is my primary area of expertise. So, I saved the best for last.
One of the more common answers that I hear when I ask a business owner how much they have budgeted for marketing is that they don’t have a budget for marketing and that they get business by word-of-mouth.
Often, this is a sign that the business is on the way out. (Now, I am not saying that this is the case with every business out there!). While you can certainly get new customers through word-of-mouth, getting a sizable and sustainable number through that means alone is difficult and a risky strategy.
Every company whose products or services you love devotes money to marketing. They know that word-of-mouth alone is not going to get them that critical mass that they need to achieve the success they require.
So, rather than ignore reality, they plan for it. It is a wiser strategy; and while it won’t always work out, more often than not, the successes more than outpay for the losses.
So, if I ask you how much as a percentage of revenue you devote to marketing and the answer is 5% or less, you should be afraid. Very afraid.
Why? Because one of your competitors is going to be getting a bigger and bigger slice of your pie by doing more marketing, getting more customers, and more people to spread the word-of-mouth that you have.
If you know a small business owner who is interested in a FREE, No-Obligation, consultation with me, go to calendly.com/bradswezey. Or call me at 321-613-8476.
Brad is a seasoned public relations and marketing pro with more than 20 years of experience both inside and outside of government dealing at the national and international level. In addition to his work as a marketing consultant for small businesses, he writes a monthly column on marketing for Florida Today on small business marketing.
He graduated with Academic Honors from the United States Air Force Academy and attended Georgetown University Law Center. He has a Master of Science degree from Air University. He was an officer in the United States Air Force and completed all professional schools, to include the Air War College.
Some of the media outlets he has worked with include the New York Times, the Wall Street Journal, the Boston Globe. NBC News, Fox News, ABC, CBS, CNN, the BBC. AFP, UPI, AP, to name a few.
About JustSmallBiz Marketing
Led by small business marketing guru Brad A. Swezey, we are dedicated to helping small businesses get more customers and revenues using the right marketing for your business.