There are many ways to kill a small business in today’s modern world. But there are some ways that you might find incredible were they not true. I know I did. I found a business that was doing — or not doing the following things — and in turn, their actions and inactions were quickly leading them to their demise.
For small business owners out there, read and pay attention to the following ways to kill a small business in the modern world — unless you want your business to be next!
The phone system for this particular business has the capabilities to offer numerous lines to different locations within the operation’s property and to provide other advanced communication services. The business pays nearly $1000 a month for this service. Unfortunately, it doesn’t need nor utilize this system to near its full capacity, instead using only one line and without the voicemail enabled. In fact, the business doesn’t even have an answering machine!
This means that not only is the company wasting a significant amount of money on unused phone lines, but if customers call to inquire about orders, payments, or just about the business and its services in general, they are at the whim of someone being in the main office to answer their call, which may or may not happen. Should they decide to call after hours, they will have no way to speak with someone or even leave a message regarding their needs.
In this day and age, such service — or lack thereof — is unacceptable and may not be tolerated by many customers.
In this modern age, there may be no quicker way to kill a small business than failing to promote it on the Internet — and age, unwillingness to change or lack of knowledge aren’t excuses not to move when it comes to technology. There are enough affordable — sometimes free — and easy to use services to get at least something in the way of Internet advertising or promotional activity out there and available to the masses. Even just a self-created blog is better than nothing at all, which is what this particular business has. No website, no functioning blog, not even a Twitter account do they have to promote their operation online.
There’s really no reason these days not to be using the Internet in some capacity to be marketing a small business or staying in touch with customers, and not doing so can leave an operation in the competitive dust.
No Backup Plan or Reserve
The business in my example was hit particularly hard by the recent recession. This did not have to be the case, but there was very little planning for such a dramatic decline in the economy. While many people may have underestimated the length or severity of the economic downturn, this doesn’t mean that planning for such a situation should not be considered somewhere along the line when operating a small business.
It might not even take a full recession to have major implications upon a business, only having to affect that business’s particular industry or niche to have huge repercussions. Unlike the business in our example that had no real way to sustain a protracted economic slowdown, having a backup plan to which you can resort for extra business and income, to offer ways in which you can branch out to reach other markets, or provide reserve cash or assets can allow a small business to weather an economic storm.
Changing of the Guard
Not preparing for the future can leave a small business in the lurch when management or ownership changes hands. In our example, the small business in question was once a two owner operation in its prime, but only one person is being prepped to take over the roles once held by two. Not only this, but the owner/operator in training — while well prepared in the operations side of the business — is not as well-versed in what it takes to manage the full capacity of such an operation.
Failing to fully prepare replacements or find suitable replacements can, if not lead to a small business’s failure, at least lead to a lengthy period in which the business could stagnate or suffer due to inexperience and a heightened learning curve. And leaving an operation with less leadership than it needs to run successfully or efficiently can result in lost opportunity and inability to enact necessary changes to adjust and grow in a swiftly moving and ever-changing modern business world.
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The author is not a licensed financial professional. The information provided in this article is for informational purposes only and does not constitute legal or financial advice. For such advice, readers should consult a licensed financial advisor or lawyer. Any action taken by the reader due to the information provided in this article is solely at the reader’s discretion.