More than half of small-business owners say they’ve reinvented their company to “stay afloat or competitive,” according to a survey released by Citibank in June. Its findings suggest that the majority of U.S.-based entrepreneurs are adapting to marketplace shifts in order to survive and thrive.
“Small-business owners are especially adept at reinvention, whether because of obstacles or new visions for growth,” notes Maria Veltre, managing director of Citi Small Business. “Change is never easy, but neither is starting and running a business.”
What does “reinvention” mean? According to the small-business owners surveyed:
- 47 percent overhauled their products or services;
- 24 percent modified their infrastructure (technology, staffing, etc.);
- 18 percent expanded their sales and marketing efforts;
- 7 percent reduced their pricing and took less profit; and
- 3 percent relocated their operation.
How to Effect Change
Assuming you know you need to make a change in your business, how do you go about doing it? It can be tough to (objectively) assess the marketplace and make the necessary changes to your business, especially if you’ve already invested years in getting your company off the ground, managed a successful growth phase, and achieved some level of success.
Here are four tips for reinventing your business to meet market conditions:
- Know when the time is right. Reinvention starts by facing some unpleasant facts: More competitors have appeared. The market is changing. Your customer base is eroding. Or, you’re no longer driven by your original vision. These are all solid reasons to make a change.
- Rethink your customer base. How well do you know the people you serve? Can you explain how your product or service fulfills their needs? Now is a good time to talk to your top customers and explore new ways to satisfy their desires. Use their feedback to start rethinking your customer relationships. Meanwhile, what about customers who represent lower profit margins? Could you entice them to purchase a different or modified version of your offering? Next, identify new market opportunities: Who isn’t buying what you sell? Why not? Look for people who are ignored or bypassed by the entire industry.
- Launch a new product or service. You’re already good at what you do. What else can you offer customers that would change their buying experience? If you’re feeling burned-out with your present endeavor, remember how excited you were in the beginning. That same creative fervor can spark ideas for new offerings.
- Consider new marketing channels. If your business has relied largely on conventional marketing and advertising channels, look at the opportunities presented online. Conversely, if your web-based business needs more exposure, consider buying advertising in venues you haven’t tried before, such as billboards or television. Changing the way you market your product is a type of reinvention, especially when the message targets new customers.
What steps have you taken to reinvent your small business? Share your experiences with us in the Comments section.