Top Challenges For SMBs & Their Solutions in 2020
Small and medium-sized businesses (SMBs) seek stability and continuity – but recent study findings indicate that many face challenges in achieving this with their technology environments. In this post, we explore the problems small and medium Florida businesses face, and what role IT and tech services can play in overcoming them.
1. Under-Utilization of Strategic Technologies
Small businesses often suffer from poor, dated or disconnected disparate technology systems and platforms.
Inefficiencies in IT tend to arise in expanding businesses, where new tasks need to be integrated and existing processes lack proper integration. As a result of growth, SMBs often experience internal teams utilizing systems that are unnecessarily disconnected from other areas of the business.
This lack of integration can make utilizing, scaling and updating existing technology a lengthy and costly task. Therefore organizations struggle to realize the full return on investment from their technology.
Without the centralization of IT solutions, businesses of all sizes suffer from inefficiencies. To be truly effective, systems require consolidation across the various lines of business.
A good IT managed service provider will understand your business so they can integrate new and legacy systems, streamline tasks, and improve your existing infrastructure within the shortest possible time frame. Find out more about the benefits of outsourcing your technology strategy to a professional IT service provider.
2. Expanding Your Business
Expansion poses a challenge for any business. Particularly when it involves extending services to new sites in the US -- or internationally. It’s worth noting that only 12% of US mid-sized businesses generate revenues outside of their home state. So what keeps businesses in the US from expanding their footprint?
A Sage survey of more than 500 business owners (and decision-makers) suggests that one of the barriers to trading abroad is a lack of staff, resources, and partners that can manage the complexity of scaling their business infrastructure for expansion. Navigating legacy platforms and dealing with the associated data complexity issues can make business expansion an unappetizing task.
Our aim here at 7Nines Technologies is to enable business decision-makers to maintain focus on business implications without the need to consider the impact an expansion has on their IT setup. Adjusting your technology and suggesting improvements to best accommodate changes within your company is our area of expertise.
What are the barriers to scaling your own business?
3. Managing the Supply Chain
With business growth comes added layers of complexity. It’s a challenge to keep track of every detail within the supply chain -- be that logistics, stock control or finance.
Poor supply chain management is one of the most common pitfalls for SMBs. It’s alarming how much potential efficiency is lost when companies fail to maximize every area of the business. Wastage can hold a business back in its quest for sustainable growth.
The longer the supply chain, the more scope there is for things to go wrong. A supply chain is only as strong as its weakest link.
Staff, and management thereof, are critical to any business. But SMBs increasingly lean on technology to manage their supply chain. In most areas of business in today’s digital age, technology is used for support — from product development at the forefront, to project planning at management level, to accounting at the back-end.
Specialized IT solutions minimize risk, and ultimately allow your business to streamline increasingly complex processes and increase returns over the long run. It is critical to ensure that your technology platforms don’t become the weak link. To learn more about what makes a good IT Service, we recommend reading our post: What's The Best IT Support Service For Your Small Business?
4. Is Cloud Computing Right for My Business?
There are compelling reasons to move your business to the cloud.
Having access to your information anywhere, anytime across multiple devices is fundamental for the modern-day business looking to capitalize on the ‘always on’ workforce.
It’s estimated that companies could add up to $10.4 billion to the US economy each year just by taking a more strategic approach to flexible working. To invest in Cloud technology and to part ways with existing infrastructure is often a tough decision for SMBs.
Is Cloud computing the future of your business?
Realizing the benefits of mobile and flexible working requires careful use of Cloud and mobile technologies. A Cloud technology expert can assist with this.
7Nines Technologies can bridge the gap between technology and your business. We believe in stripping back the tech jargon and providing pragmatic solutions. Our staff will not suggest new technology just because it’s trendy and cool.
We’ll analyze your requirements, and explain the breadth of options available to you — whether its on-premises, hybrid, or a fully Cloud solution. Crucially, we can provide you with clarity on the impact on your business of transitioning to Cloud computing, both short and long term.
While Cloud may well be the future for many Florida SMBs, whether you choose to employ it ultimately depends on several factors including your technology budget and business plans. Take a look at our various cloud & hosted solutions and see the benefits of Cloud computing solutions to your small business.
5. Cybersecurity and Compliance
In recent years there’s been a tremendous increase in mobile data usage. As a result, cyber threats are more sophisticated, data breaches are more common, and information security compliance is higher on the agendas of regulatory agencies and business partners. Security is becoming increasingly difficult to manage.
Investing in security is expensive and often seen as a ‘grudge purchase’ by SMBs wishing to remain focused on business objectives rather than looking over their shoulder. But unfortunately, companies of all sizes face the same threats, and are subject to the same challenges, regardless of their budgets.
Due to a lack of knowledge and motivation, it’s unsurprising that small companies often fail to protect themselves, their staff, and clients.
Independent security experts can guide businesses towards protecting the interests of their teams and clients. However, businesses need to be aware that some solutions are expensive and excessive. 7Nines Technologies can help you strike a balance — where security requirements are met, all interests of the business (including your partners, employees, and clients) are sufficiently protected, and the cost isn’t detrimental to growth.
At 7Nines Technologies we understand that SMBs require fast, cost-effective control measures and IT solutions that are easy to manage. We take security very seriously and help to educate all clients on both the challenges and potential threats. Our proactive approach means that the vast majority of security vulnerabilities are addressed before they pose a serious threat. In the event of an unforeseeable crisis, we’re poised to help you recover as quickly as possible.
6. Finding the Right Skills and Talent
A survey of 2,500 SMBs found that management skills -- especially entrepreneurial skills -- need improvement and augmentation. Skill & talent shortages extend beyond management and into the workforce.
Competition is the main contributor to this problem as, since inception, SMBs face pressures from bigger, competing companies within the same field. Larger companies benefit from the ability to lure valuable, skilled staff under the promise of career stability and personal growth. Joining an independent firm is a riskier proposition. With a record-high in employment rates, skilled staff is becoming harder to acquire in Florida and across the US. It’s becoming increasingly difficult for small companies to find talented individuals. Yet it remains vital to have the right people in place to meet the ever-rising needs of customers.
SMBs must invest in employee engagement, training, education, and labor-saving platforms to prevent talent shortages from being their toughest challenge in 2020 and beyond.
These platforms, such as modern IT systems, are arguably the broadest component for supporting modern startups and small businesses. But no matter what technology you use to streamline your tasks, great team members remain your true asset.
We recognize the importance of our people. We heavily invest in training and developing our personnel. In turn, our clients benefit from a competitively-priced first class service — whether that involves an engineer coming to your office to resolve a fault, or one of our helpdesk staff answering your calls. Improving our workforce comes at our expense — not our clients, which is why they give 7Nines Technologies these glowing reviews of our IT services.
7. Rising Costs and Reduced Revenues
This is perhaps the most obvious problem of all. According to a Guidant Financial Small Business Report, SMBs perceive rising business costs as a major risk to their business. SMB costs are expected to continue rising in line with inflation in 2020.
The current round of trade negotiations and tariffs hasn’t helped matters, either. In particular, it directly impacted businesses that buy materials, products or services from overseas. Coupled with the increase in other business costs, SMBs are feeling the pinch.
A study by Make it Cheaper found that the most common reaction to increased costs was (a) to increase prices of products/services, and (b) make staff cuts. The majority of SMBs predict that their revenues will shrink or remain the same through 2020. Optimism is moderating, projections for SMB productivity still in questions, and profits are a genuine concern.
There are some actions that businesses can take to reduce costs on their cash flow. As Jonathan Elliot, the MD of Make it Cheaper states: “by shopping around, comparing prices, regularly switching suppliers and taking care not to get caught in contract renewal traps, companies can go a long way to bringing their overheads under control.”
So how does 7Nines Technologies help clients save money through this turbulent period?
- No standard 12-month contract. Choose to stay or leave, as you see fit for your business strategy and IT budget
- Adjustable IT overheads. We’re flexible to your changing needs.
- We do the ‘shopping around’ for your technology. One of our jobs is to identify the most suitable and cost-effective software & hardware for your business. We’ll present the best possible prices for you.
8. Securing & Managing Funds
Raising and managing funds for your growing enterprise is another challenge.
Once you’ve secured funding for your business concept, considerable attention must be turned to:
- Reducing supply chain (production) costs, and
- Managing cash flow.
Underperforming companies may need to address one, or both, of the above points to improve profitability. Fast-growing companies, on the other hand, often outgrow their available funds and miss out on an opportunity to expand.
Another common issue SMBs experience is not getting paid on time by customers. Or worse -- recovering from debt. The former might be out of your hands (e.g. it requires legal action). The latter is more obviously preventable through various financial channels. Many Florida SMBs aren’t aware of their options.
Small businesses are looking to grow in 2020, and access to external finance may be an important enabler. It’s no longer a case of choosing between traditional term loan debt finance or relinquishing equity. Alternative lenders now offer a range of flexible, growth-focused finance products.
You can learn more about the basic funding methods for small businesses from Investopedia: https://www.investopedia.com/articles/pf/13/business-financing-primer.asp
When it comes to running the business, understanding the money you have available and maximizing the output is vital. Managing and monitoring payments, cash flow and profits help to prevent running the business into financial turmoil or damaging your credit score. After all, your credit score is not only important for borrowing funds -- it also affects your ability to secure good terms on trade credit.
So what about IT? How does that factor in?
Consider how system downtime or instability impacts your costs. If the running of your service hinges on technology -- to the point that you couldn’t possibly sustain it in the event of a hardware or software failure -- then outsourcing could be the way forward. For more information on Business IT support, read our post on the Benefits of Business IT Support For Small Companies In Orlando.
7Nines Technologies is responsible for ensuring that our clients’ systems are always operational and working day and night. We proactively monitor their technology to detect hardware or software faults before they hamper productivity. In the event of an unforeseeable fault, making a rapid recovery is our top priority. We know how important continuity is to your growing business.
Does IT Play a Role in the Development of Your SMB? Will Improved IT Solutions Assist Your SMB in Overcoming Problems in 2020?
7Nines Technologies believes that IT plays a pivotal role in the growth and development of Orlando and Florida-area SMBs.
We aim to empower our clients by reducing the amount of time, expense and other resources they devote to technology. Through our IT Services, SMBs become leaner, more flexible, and able to scale up their services at a lower cost. Read how 7Nines Technologies helped one Orlando business to grow in 2017.
If used effectively, IT increases company productivity and enables SMBs to prepare for unforeseeable economic uncertainties. To learn more about how our Orlando IT services company can help stabilize your business operations, and align with your vision of growth and sustainability, please reach out to us here.
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