By Ruth Jamie
Many women with high aspirations for their careers dream of entrepreneurship. Even UK policymakers acknowledge that small and medium enterprises (SMEs) are the backbone of the economy because they create millions of job opportunities while helping to build communities as well.
Yet, not many SMEs actually succeed. In recent months, almost 500,000 UK small businesses have been at risk of bankruptcy and layoffs. This is due to inflationary pressure, and even long-established entrepreneurs in the industry are struggling to keep afloat.
This shows that a good product is never enough for entrepreneurship to take off. Businesses are always risky, but what are these risk factors to watch out for and how can we better mitigate them? Below, we take a closer look.
Lack of planning can kill a business
It's common knowledge that businesses can take a while to establish themselves. Hence, many new businesses tend to hold out for an ROI while waiting for the tide to turn.
However, the chances of that tide turning are low. Approximately 4 in 10 UK businesses don't make it to their fifth year. There are many reasons why new businesses fail and for many companies, it can be from starting on the wrong path. This means failing to properly investigate the market, generate a target audience, and conduct efficient marketing strategies.
On top of all that, your business may be poorly located too. In that case, it may be difficult to secure a loyal consumer base no matter how high-quality your products are. Careful planning is the first step for any business and is well worth the effort.
Details are essential
It’s possible that your large-scale logistical factors such as product and location are secure. However, entrepreneurship is a multi-operational sensitive venture that banks on the smallest of details.
From manufacturing to marketing, to sales, every aspect must be properly managed to ensure a seamless customer experience. For one, the cart abandonment rate is growing. This means that consumers have already expressed an inclination towards the product but ultimately decided to abandon their purchase because of factors like inconvenience. This can stem from hidden charges, a lack of shipping options, or a lack of payment options.
The simplest tech upgrades and appropriate merchant services for small business operations can streamline the customer purchase process. An addition of a card machine can cater to the growing users of cards over cash, and the acceptance of phone or email payments can help accommodate hygiene-conscious consumers as well. Little details like these are crucial for the customer service experience and can even boost customer loyalty.
Networking is key
Of equal or higher importance to the quality of your product is networking. Many women tend to fall victim to self-imposed barriers such as the tendency to undersell themselves. However, a female entrepreneur's sensitivity and increased ability to empathise is also helpful in building a base of loyal consumers that genuinely trust the business.
Women entrepreneurs with strong interpersonal skills may also find it easier to form critical partnerships with suppliers. However, it may be difficult to engage in trade-offs and stake your position in the industry at first, so try to find a mentor at the beginning of operations to increase your access to funding or markets.
A proper money mindset is crucial
As we've mentioned in a previous article, to deal with the challenges of a volatile market women entrepreneurs need to be resolute in their mindset to earn money amidst risk and uncertainty. Entrepreneurs have to be resistant to setbacks and rejection because the slightest hesitation or overlap in judgement can be fatal to the business. Analyse every risk in terms of profitability in the short and long term, and don’t forget to continuously retrace your steps. Entrepreneurship is a demanding field, but with meticulous planning, business owners can successfully overcome the challenges of the market.
Article written by Ruth Jamie
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