Small and Medium Enterprises (SMEs) are the backbone of many economies around the world, while SMEs accounted 97.4% of the business establishments in Malaysia in the Year 2021 with the average growth rate of 5.2% over a 6 years period. They play a crucial role in creating jobs, stimulating local economies, and promoting innovation and competition. However, many SMEs face challenges in growing their businesses beyond the current state, including client and founder dependence, the balancing act between quality and growth among others, while the majority of them do not even know where and how to address the bottlenecks or limitations that their business are facing. All these challenges could be addressed effectively when SMEs spend time to revisit their business modelling that fortify competitive edge, and refine business value propositions to expand the addressable markets for their business. A well thought through business strategy and comprehensive marketing plan shall be the outcome of such exercise.
The Old Ways Do Not Work Anymore
Unfortunately, despite the new competition coming into the marketplace and the evolving customer appetite, many SMEs still assume that their products or services are good enough and will sell for themselves, while downplaying or even ignoring the deteriorating competitiveness at an early stage. SMEs are often caught up in two situations: (a) trying to sell an existing product or service to everyone without defining the target customer, and (b) only selling to existing group of customers without exploring new usage scenarios to expand the customer base. In situation (a), SMEs tend to “fall in love” with their existing line-up of products and services and believe that they are perfect and meet every customer’s needs. However, they fail to recognize the specific conditions or requirements of individual customers that the current products may not be able to address, partly explaining the sales not meeting expectations.
For example, a clothing retailer, Mrs. A, used to sell the latest fashion to customers of all ages. She never thought to segment her target audience and offer specific styles that would appeal to each age group. As a result, her sales were lacklustre, and she struggled to keep up with the competition. It wasn’t until she sought external assistance that she realized the importance of having a well-defined target audience and offering specific styles that would appeal to each age group. By doing this, she was able to increase her sales and stay ahead of the competition. In today’s fast-paced business world, it is crucial for SMEs to stay ahead of the competition and continuously adapt to the ever-changing market and customer demands
What Exactly Are You Offering?
On the other hand, some SMEs do not spend enough to establish clear value propositions for their products and therefore miss out on opportunities to communicate these value propositions that may appeal to more customers. The lack of clear value propositions can also result in difficulties in differentiating the business from competitors, which can negatively impact sales.
For example, a software company, ABC Inc., used to develop software for various industries without clearly defining the value propositions for each product. As a result, they struggled to differentiate themselves from their competitors and failed to communicate their unique selling points to customers. It wasn’t until they sought external assistance that they realized the importance of having clear value propositions for each product targeting at different customer segments. By doing this, they were able to map the software offerings against the unique requirements of distinctive customer groups. hance further differentiates themselves from their competitors and increase their sales turnovers.
Let’s Go Back To Basics
For SMEs, staying ahead of the competition and continuously adapting to changing market and customer demands can be a daunting task. But with the right support and guidance, SMEs can overcome these growth challenges and unleash their true potential. Our team of experts at MySMEHub specializes in helping SMEs to overcome these challenges and grow their businesses. Our 6-step approach to business success that are backed by proven strategies, techniques, and tools will help your SME unlock its potential and take your business to the next level.
Don’t let growth challenges hold your SME back from reaching its full potential. Contact us today to schedule a free consultation and see how we can help you overcome these obstacles and take your business to the next level. The future of your SME is in your hands, and we are here to help you unlock its full potential and achieve success.