Recently, Bill has had many conversations with business owners across a range of industries on LinkedIn regarding the current challenges that SMEs and their teams are facing. These conversations have been insightful, so we decided to share the most common causes of pressure to reassure you there are others out there in a similar position!
Before we get into these, it is important to note that the current demand for products is HIGH. Yes, this is pressure in itself, but it’s there to be taken advantage of as you have customers waiting for what you can deliver!
Pressure 1: Recruitment
As of late, recruitment has faced the perfect storm of challenges. Between Brexit, the great resignation, and the pandemic, employers face the most severe shortage of job candidates. According to a recruitment body, the post-lockdown surge in the economy has meant starting pay for permanent staff has been pushed up at an unprecedented rate.
It’s undeniable that it’s a candidate-driven market. But that does not mean that it’s impossible to hire. It’s tough, but the right people are out there. To ensure you’re reaching the best candidates, consider your job advertisement – have you given an in-depth explanation into the following:
- Tasks involved in the role
- The skills and experience needed
- What values and behaviour your ideal candidate would have?
- The pay and benefits of the role
It’s important to consider the above from the best candidate’s perspective. Think about the perfect person for the job and when you’re writing the above, be sure to bear in mind why they would apply for your role.
You’ll receive great applications once you’ve pulled together a job advert with the above PLUS a compelling reason why they should come and work with you.
Also, don’t forget to include your current team in the recruitment process because they are the best advocates you have to attract new people.
Pressure 2: Supply Chain
The Covid19 pandemic heavily disrupted the supply chain for many businesses. Trade restrictions, lockdowns and shortages led to manufacturers worldwide facing delays.
In Bill’s conversations with business owners, one recurring comment was how this disruption would have knock-on effects on the rest of production. For example, if a small bracket hasn’t been delivered, the product cannot be finished. This delays the order, so the invoice cannot be sent, impacting the business’s cash flow.
Moreover, the devastating atrocities occurring in Ukraine are having a domino effect on supply chains, and before this, the Suez Canal incident had impacted the delivery of goods.
It’s been relentless, and business owners have seen their fair share of supply chain issues, but the business owners we spoke to were not discouraged as among these challenges is a lesson to be learnt.
You need to ensure you are not dependent on one supplier.
These situations are forcing business owners to look for alternative providers to make their supply chains more resilient without weakening competitiveness. Additionally, finding alternate suppliers is helping to build new relationships. When an existing supplier cannot deliver, you may find a new supplier who can offer a superior product or for a better deal.
There’s also been an uptake in onshoring due to supply chain disruption. Covid has taught us that whilst ordering materials from other countries is possible, it isn’t to be wholeheartedly relied upon. So, many of the business owners we spoke to were looking into how they could shorten their supply chain by looking closer to home.
Pressure 3: Cost
There are two significant sources of pressure when it comes to costs: staffing costs and rising material costs.
If we start by looking at staffing costs, there are increasing costs for business owners trying to retain staff. As mentioned, it’s currently a candidate-driven market, so there’s more pressure to hold on to your valued team members by increasing wages, bonuses, and benefits. There’s also growing pressure to equip the workplace better, from investing in training, mental health support and equipment. However, there is a lot of money out there from an institutional investment perspective. If you’d like to discuss the investment funding and capital in the marketplace and how to access it, get in touch.
Remember, it’s cheaper to retain talented team members than recruit and train new people because of staff turnover.
When speaking to business owners, the rising cost of materials was a point that has echoed from industry to industry. What’s more, the increasing energy cost has put pressure on many SMEs. 70% of small and medium businesses believing that energy costs have impacted their growth.
Pressure 4: The Pace of Change
The rate at which things are changing has been relentless. With a surge in demand leading to the need to recruit, business owners have had no choice but to be resilient. But it allows us to be creative and look for proactive and positive ways to solve the challenges thrown at us. In turn, it’s helping us build a more robust structure in the business, and your team will find ways to cater to demand without overwhelming the business owner.
Pressure 5: Things Happening that are Outside our Control
Another source of stress for business owners is the things that are beyond our control. From Brexit to the war in Ukraine to Covid, there have been many causes for concern recently. If you are struggling, here is a helpful article on how to cope and not stress about what you cannot control.
Pressure 6: Cash Flow
The final challenge the business owners we spoke to were facing were related to cash flow. All of the previous five pressures affect an SME’s cash flow. We have learnt it is becoming more challenging to get invoices out on time, forcing business owners and their senior teams to reflect on their current practices and decide what they can do to improve their cash flow. Want to discuss how you can improve your cash flow? Get in touch with Bill to brainstorm ideas.
Business owners – Which of these pressures have you faced?
A huge thank you to the 13 business owners who kindly volunteered their time to talk to Bill about the challenges they’re facing. The conversations Bill has had have been fascinating, and we’re keen to find out if these pressures have been felt across the board in other industries. We’d be interested to know; have you have felt any of the above pressures? Or perhaps there’s something you believe to be missing off the list. If so, let us know by sending Bill a message on LinkedIn.
If you have felt any of these pressures, know that you’re not alone. Why not discuss your struggles in a safe space where you can learn to overcome such challenges by using other business owners as a sounding board. If you like the sound of this opportunity, do consider group coaching. Or contact Bill directly to book a confidential one to one chat.
