Tackling the Top Five Business Challenges at the VSU SBDC
Tuesday, August 19th, 2014
In 2014, the University of Georgia Small Business Development Center in Valdosta is focused on helping small businesses continue to navigate and thrive in a sluggish economy. Here are the top five challenges SBDC clients are facing this year, according to Valdosta SBDC consultant Lynn Bennett.
1. Cutting Expenses
"With the continuation of a slow economic recovery, businesses have to work lean and mean," Bennett said. "The SBDC can help businesses analyze their processes and find ways to reduce expenses."
2. Dealing with the Affordable Care Act (ACA)
Uncertainties about the impact of the ACA continue to create obstacles for small businesses in terms of hiring new full-time employees. According to Bennett, the ACA in general is expected to raise costs for small businesses, which is causing many to avoid expanding payrolls. Studies show that business owners are already seeing a 3 percent to 4 percent increase in their insurance premiums, on average. The implications for many businesses owners are that they will have to spend additional time planning for the increased costs and do their research so they fully understand the new rules under the ACA. The SBDC can provide assistance with human resource issues resulting from the ACA.
3. Offering Competitive Prices While Still Covering Operating Expenses
Many businesses struggle with maintaining and increasing profit margins. Competition is limiting price increases and at the same time input costs such as transportation are on the rise.
"The price of gas is a big concern for many businesses. It can increase shipping costs of merchandise and that means you just have to operate lean in other areas," Bennett said.
4. Gaining Access to Capital
Banks are beginning to give more business loans, according to Bennett, but businesses need a strategic plan for growth so there is "a method to the madness." While capital may be more readily available, businesses should focus on smart growth not just growing quickly. The SBDC can help business owners develop a strategic plan for their companies.
5. Attracting Additional Business with a Strong Marketing Plan
Many businesses struggle with the changes that have occurred in marketing over recent years, specifically the use of social media platforms such as You Tube, Twitter, Instagram and Facebook. According to Bennett, many businesses may not have a marketing plan, goals, budget or process or if they do, it has not been updated.
"If businesses lack expertise in marketing or especially in social media, the SBDC can help them get educated and up to speed on the latest tactics," Bennett said.
"It's amazing how using these platforms can increase the number of hits a business gets on its website which ultimately can result in additional sales."
Using the Resources at the SBDC
The Valdosta SBDC offers a variety of programs and one-on-one consulting to new and existing businesses. It launched the Maximum program series, which includes Maximum Contact – classes on how to use social media – and Maximum Money – classes on financial management and reporting – among others.
"The response has really been excellent. After the Maximum Money class, we had several businesses come to us for one-on-one consulting to help identify areas where they can save money. Our goal is to help entrepreneurs start new businesses, as well as help existing businesses to grow and prosper," Bennett said.