In today’s ever-changing economy, small business owners must stay on top of trends and anticipate potential challenges. Unfortunately, statistics show that 96% of businesses fail within any ten-year period, with a little less than 4% surviving.
To increase the odds of success,be aware of changes in business and make plans to ensure they lead to your success—not your downfall.
Change 1: Competition
Change is inevitable, but in business, it can be detrimental if you aren’t prepared. This is something that Blockbuster Video learned the hard way when Netflix entered the scene. In 2000, Netflix offered to be acquired by Blockbuster for only $50 million, which was quickly dismissed by the video rental giant. Four years later, Blockbuster finally launched its streaming subscription service, but it was too late—Netflix already had 4.2 million subscribers and announced its billionth DVD delivery in 2007. Blockbuster had 50 million members at its peak in 2007, but even their high customer base didn’t save them from bankruptcy in 2010. By then, Netflix’s worth was around $13 billion. It may seem impossible for 50 million customers to slip away from Blockbuster so quickly, but that’s exactly what happened. Netflix’s rise to success serves as a reminder of the importance of being aware of your competition and anticipating trends.
Had Blockbuster’s leaders stayed aware of the changes in business, they’d likely still be here.
Change 2: Technology
In today’s competitive landscape, it’s essential to stay ahead of the curve when it comes to technology changes. As the business world evolves, tech-driven disruptions can upend industries and traditional business models in just a few short years. While some companies may see these changes as a threat, they can also be an opportunity to seize the future and become a disrupter, rather than the disrupted. Take Instagram for example. The photo sharing mobile app was created in 2010 and acquired by Facebook in 2012 for $1 billion. While this was a huge payday for Instagram’s founders, it also served as a wake-up call for other businesses who saw the potential of Instagram and similar technologies. This is just one example that shows how quickly technology can disrupt an industry and create new opportunities for business.
As a business leader, ask yourself how technology will affect your industry and how you can use technology to achieve business success.
Change 3: Culture
Another change in business to be aware of is cultural shifts. When file sharing platforms like Napster, Limewire, Kazaa, and Morpheus were released in the early 2000s, music lovers of all ages no longer had to buy CDs at music stores. Everyone was downloading their favorite songs—for free. This cultural shift led to an entire industry being decimated. In 1999, the music business made $38.6 billion in sales, yet that number plummeted to $16 billion the following year due to the widespread illegal downloads of music. Due to this change, Steve Jobs had a crazy idea. He reasoned that while people didn’t want to pay for entire albums, they also didn’t want to poke around the internet for hours to find music illegally, so he proposed a solution: 99 cents per song. By 2007, the sale of digital singles had overtaken CDs in a landslide, and Apple had become the number one music retailer in the world.
To stay ahead of cultural shifts, ask yourself what behaviors are trending, what shifts are currently happening in your industry, and how you can use them to your advantage.
Change 4: Economy
Obviously one of the biggest changes in business to keep an eye on is the economy. The global financial crisis of 2008-2009 was an incredibly difficult time for businesses around the world, but Starbucks’ story is a great example of how companies can survive a recession and come out stronger on the other side. When Howard Schultz returned to Starbucks in 2008 as CEO, he faced a financial crisis that saw quarterly earnings drop by 26%, the first negative in-store sales figures in the company’s history. In response, he implemented several drastic changes, including cutting costs by nearly $600 million and closing 7,000 stores for a retraining session. This focus on core business and customer service allowed Starbucks to weather the storm of the recession and come out on the other side even stronger than before. By the end of 2022, their annual revenue had increased by 10% and the company was firmly back on track.
This story is a great lesson in how being prepared can help you survive economic shifts. Make sure to be proactive about planning for future recessions and willing to take drastic action when necessary. After all, an economic crises can be the perfect catalyst for innovation and growth
Change 5: Customers’ Lives
If you’re a business owner looking to target a specific niche demographic, it can be difficult to anticipate and respond to your customers’ changing needs. Customers need to drive changes in business. To illustrate this point, let’s take a closer look at Harley Davidson, the American motorcycle manufacturer. For years, baby boomers were their biggest demographic, but with that generation aging out of the market, Harley had to find ways to appeal to the next generation of customers. The key was recognizing the stages of growth that people go through in their lives and marketing to new audiences accordingly.
As people get older, have families, and enter different stages of life, their decisions change. This applies to your customers and employees. To remain successful and relevant in the market, start getting a better understanding of changing needs and respond with new strategies and products.
Change 6: Employees’ Lives
As the pandemic demonstrated, when the need to work remotely arises, businesses must find ways to stay productive and retain top talent. From flexible schedules to remote work, offering employees the opportunity to have more of a work-life balance is key. With the rise of “quiet quitting”, employees are no longer willing to go above and beyond for companies that don’t treat them well. To get ahead of this change in business, listen to your employees’ wants and needs and respond accordingly. By making policy adjustments that provide a better work-life balance for your employees, you can create an environment that retains your best employees.
Change 7: Your Life Stage
At times, it can be hard to remain motivated and invested in your business. That’s why it’s important to stay aware of what’s happening in your life and how it might affect your business decisions. Major life events like getting married, having a baby, or beating cancer can impact your business approach. The pandemic has also caused many people to re-evaluate their priorities, so it’s important to take stock of how you’ve been affected and changes you might need to make.
No matter what life throws at you, remember that giving yourself a break is just as important as giving your employees one.
Stay Ahead of Change With Coaching for Business Owners
At Inspire Results Business Coaching, we provide business owners with the skills and resources they need to stay ahead of the competition and ensure their business is on the cutting edge. Our unique coaching methods help entrepreneurs explore their options and develop business change strategies for success. Contact us today to learn more about coaching for business owners.
