Small businesses struggling

Small businesses are facing challenges when it comes to growth and attracting new clients.

“As the digital and social media world continues to evolve, it can be overwhelming to traditional business owners,” says Athena Varmazis, vice president and general manager, small business services, American Express Canada.

Read: Help small businesses through big issues

Despite retaining three quarters (74%) of customers, small biz owners are still threatened by competitor offerings (25%) around customer service (18%) and price (13%), finds the American Express Small Business Monitor. Competition (36%) is also their greatest marketing challenge.

Also, half of small biz owners admit to not having a company website, and say social media tools haven’t been effective in building their brand. Further, 58% say social media isn’t important to their business.

“With SBOs relying almost exclusively on the customer service experience to generate positive word of mouth, they risk falling behind competitors who engage with their customers on a daily basis through social channels,” adds Varmazis.

Read: 4 ways to help small biz clients

Only one-third of small businesses have embraced social media. Of those, 38% say they find it effective. LinkedIn (35%) and Facebook (34%) are the leading social media channels.

Additional findings include:

• 18% cite customer satisfaction is another challenge in retaining clients;
• 83% don’t conduct regular client feedback surveys;
• 57% remain hopeful about their future financial position (down from 70% last quarter);
• 46% report their business’ current financial position is improving (down from 60%).

Read: Small biz confidence declines, again

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.