Running a business is a continuous learning journey, and mistakes are a natural part of the process. The fact that you’re reading this means you’re taking a proactive approach to strategising— which is the perfect mindset if you want to drive long-term success.

A big part of our business advisory service is helping you develop strategies to overcome hurdles before they arise. By working with us, you’re actively shaping the future of your business with a forward-thinking approach. This is what sets successful businesses apart –  they anticipate challenges, adapt quickly, and stay focused on long-term goals while navigating day-to-day obstacles.

We understand that every business is unique, and the challenges you face today may not be the same as those you’ll encounter tomorrow. In saying this, there are some common issues of which  every business owner should be aware. We dive into these challenges below.

A sales strategy with no structure

In the long run, an inconsistent or unfocused sales strategy can stunt business growth and leave you vulnerable to competitors with a more defined approach.

Have a clear plan outlining how you will market, price, and sell your products or services. Don’t leave any room for doubt in terms of your target customers (and their desires), your point of difference, revenue goals, and the best sales channels.

An example of a company that suffered due to unclear direction was Masters Home Improvement, which was Woolworths’ attempt to compete with Bunnings. Without a well-defined sales strategy, Masters struggled with weak revenue, leading to its closure in 2016 after costing Woolworths billions of dollars. Some issues they encountered were:

• A pricing strategy that set no clear positioning between being a discount retailer or a premium alternative;
• A product range misaligned with their target audience (influenced heavily by their North American partners rather than the Australian market); and
• A lack of strong differentiation from Bunnings or other home goods/improvement retailers, making it difficult to attract loyal customers.

Poor inventory or supply chain management

When inventory levels are mismanaged, this leads to costly stock imbalances. Having a reliable inventory management system in place is essential — including the use of software tools that track product levels in real time, or are easy for your team to update, as well as conducting regular audits.

It’s also important that you or your business advisors are using data analytics to predict demand fluctuations. Things like patterns in historical sales figures, market trends, seasonality or events can tell you a lot about how consumers are likely to behave throughout the financial year.

Other routes include small-batch production, sharing manufacturing schedules with customers ahead of time (for example via pre-orders), or adopting a made-to-order model in which your business receives goods only as they are needed for production. 

Our final tip is to diversify suppliers and distribution channels, to ensure that you have backup options in case of supply chain and delivery issues.

Inefficient operational processes

Disorganised or outdated operational processes can drain resources. A clear example of this was Australia Post’s struggle with digital disruption in the 2010s. As online shopping surged, demand for parcel deliveries grew rapidly, yet Australia Post’s operational model — designed primarily for letter delivery — left it struggling to keep up.

Without efficient logistics to accommodate changing market demands, Australia Post faced financial struggles and declining relevance. It had to overhaul its processes, investing in E-Commerce delivery infrastructure like automation and digital tracking to stay competitive.

The lesson? Regularly assess and refine your operational workflows to improve efficiency and plan ahead based on emerging trends in your market. And sometimes, this will require investment.

Neglecting customer experience

A guiding principle of our service at The Co. is seeing beyond numbers — making sure we always consider the human interactions and relationships that drive a successful business. This applies to your approach to customer satisfaction. If you don’t prioritise customer service, your brand reputation and ultimately your profits can take a real hit.

If you need a sign that a positive customer experience can give you an edge, look at KPMG’s Customer Experience Excellence 2024 report. The top 10 Australian brands for customer experience are also the leaders in their industry, including Mecca, Specsavers, Bunnings, and Chemist Warehouse.

Some ways to make sure the customer experience is on point:

• Regularly collect and analyse customer feedback through surveys, reviews, and direct communication
• Train staff to handle enquiries with professionalism, empathy, and efficiency
• Act on constructive criticism to improve products, services, and overall customer experience
• Ensure quick response times and accessible communication channels to retain customer trust

Running a business comes with its share of challenges, but addressing pitfalls early can set you up for long-term success. As we’ve outlined, the businesses that thrive are those that learn from their mistakes, adapt to market shifts, and prioritise both operational efficiency and customer satisfaction. 

Let us help you avoid the kinds of missteps that can derail growth. If you’re looking for expert business advisory, get in touch today.