Benjamin Franklin is quoted as saying ‘If you fail to plan, you plan to fail.’
The failure of business owners to proactively plan and manage their business strategy and a lack of persistence, would appear to be the downfall of many small enterprises, 70-80% of which, according to a UWC study never make it to their fifth anniversary in business.
There are many so called ‘soft skills’ required for a business to succeed (https://atouchofbusiness.com/management/why-do-most-businesses-fail/), including strong leadership, robust human capital processes and strong sales and marketing strategies, but assuming that these are all in place, what other safeguards does a company need in order not to fail?
- Constant innovation
In today’s fast moving, digitally transformed world, the necessity to constantly innovate is an imperative for business longevity. This doesn’t only mean investment in the research and development of a company’s core product or service, but also innovation in the systems and processes that enable a business to function and operate in a globally competitive market. Investing in the right kind of innovation may spell the difference between success and failure, according to Forbes.
- Mitigate fraud and risk factors
A company’s inability to prevent, or at least mitigate, both financial and reputational risk may result in failure. No business can afford to compromise either. Given South Africa’s unenviable rating as highest on the list of countries subject to economic crime, where almost one in every two transactions is a fraudulent one, the importance of installing cyber-security measures or partnering with a company that can assist you in countering any identification or verification threats, cannot be underestimated.
As companies increase their use of both transactional as well as social media platforms, they expose themselves in an arena which is showing the highest level of fraud today, according to a report by PWC.
It is unthinkable that a business would not install building security, therefore taking the same approach to digital security, applying safeguards throughout their systems, makes business sense.
- Maintain control
Maintaining control of all aspects of your business might sound like very basic advice but having systems in place to control traffic through your server, and to verify in and outgoing payments is a critical element in protecting your company against fraudulent activity. With high levels of ID fraud, vetting customers as you onboard them and verifying banking details before attempting to collect payments via debit order or DebiCheck, will prevent a loss of revenue at the collection stage. Digital verification using multiple authentication steps is the safest way to protect your company from fraud, and has never been more important.
- Manage your cashflow through better payment collection
Cashflow is the lifeblood of any business, and although real cash is no longer ‘king’ a healthy balance of income versus expenditure is essential for a stable business. The increase in payments via embedded financial services means that, in theory, payment collections are seamless and secure, but debtors may still default. Using products that can remove the uncertainty around client payments including identifying the best days to collect funds, will help manage your cashflow.
- Improve client retention
Using properly managed and stored client data can play a significant role in tailoring services to meet clients’ evolving needs. Tracking customer activity and purchasing patterns enables a company to manage pricing, stock levels, product lines and more, keeping them relevant and alive.
If small businesses are to become the big businesses and employers of tomorrow, they must learn to survive in an ever-changing commercial landscape. Fintech is one of the fastest growing sectors, providing digital solutions to many of the challenges that beset businesses.
Finding the right partners with the right solutions for your business may ultimately mean the difference between success and failure.
