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Top Reason Small Businesses Struggle

What’s the top reason small businesses struggle? It has a lot to do with inconsistency in the functions you need to perform to develop your business: marketing, sales, and business development. 

When we fail as business owners to be consistent in those tasks, we open ourselves to “feast or famine” cycles that prevent us from enjoying consistent income from our entrepreneurial endeavors. 

Here’s the podcast episode:

Or if you’d rather watch the video:

Today, we’re talking about the top reason why small businesses struggle.

If you are a small business owner, you can probably empathize with what I’m about to say. A couple of days ago, I talked about some reasons why small businesses fail. 

I think the numbers might be a little different if the US Bureau of Labor Statistics was able to include numbers on freelance businesses and other types of businesses that are sole proprietorships. We don’t necessarily require registration, office space, and other indicators of a  thriving business. 

Why Small Businesses Struggle

So for a business like mine, I can work with my team remotely to keep overhead down, and the government didn’t really have a way to track me as a small business (With the exception of the fact that I recently filed as an LLC). So, as quickly as I came into existence, I could go out of existence. Would they count me? No. 

Feast or Famine Cycles

The top reason why small businesses struggle is they set themselves up for feast or famine cycles. I’ve been talking about this a lot with my small business friends in the context of the business planner that I’m designing. 

What does that mean? It means that when business is coming in, it’s great. You’re feasting. Revenue is high and profits are up. But eventually, you hit a schlump and it starts to go down. That’s your famine cycle. There are no clients to be found anywhere. 

Inconsistency is the Main Culprit 

This typically comes from not handling your non-billable tasks. Non-billable means you can’t get paid for them. The tasks I’m talking about are your sales, marketing, and business development tasks. We tend to let these fall off when we get busy with client work. 

This is the difference between working in your business (Working on client work), and working on your business (Doing admin tasks). 

Let’s say you’re really good in-person, and you can work those networking events like nobody’s business. Good for you, but that only works if you attend the events. 

So if you attend the events at a time when you don’t have client work, you’ll get clients and stop going to the events. 

Once that client work is done, you don’t have any more incoming clients because you didn’t consistently go out and market your business. You didn’t consistently go out and create partnerships. Now you’re going to hit a famine cycle. 

Another great example, usually more linked to companies, is when you post to your company blog and social media when the workload is right. 

You post, you show up every day, you talk to people on Linkedin, you comment on Instagram, you’re posting once a week to your company blog, you’re consistent. You’ve got good engagement on the social media channels you choose to be on. 

By doing that sort of marketing, you’re setting your company up for inbound leads, which are leads that you don’t necessarily go out, identify, and pick. I wrote a blog post, you found it via Google or through a social share, and now you’re engaging with me. You’re coming to me, as opposed to me going to you. 

Your company’s blog is really healthy and consistent when the client workload is light, but when it’s not light, you fall off. You might go a month or two without posting. 

That inconsistency is bad for you. So when the workload gets light again, you’re back to posting and you get more inbound leads. When you convert those leads to customers, you stop posting. 

When entrepreneurs and small-business owners don’t do these sorts of tasks, you’ll see a revenue dip sometime after. It’s normally a pretty easy pattern. I know the freelancers and solopreneurs listening to this are thinking, “Oh man, now that I think about it, there is a pattern”. 

Too Many Hats, Not Enough Heads

This typically happens when there are too many hats. We talk about entrepreneurs wearing hats. This is my sales hat. This is my marketing hat. Oh look, my Biz Dev hat. 

There are too many hats, not enough heads because typically it’s your head. 

Even if you do have a few employees, they’re likely junior employees, who can’t really help you with these sorts of tasks. Or maybe the senior people are constantly on client work, so you can’t pull them off to do this stuff. It’s all on you. 

Let’s do a quick recap of what some of these tasks are. 


Marketing is the action of promoting your products or services, including market research. 

In the first podcast episode, we talked about how 42% of small businesses fail because they didn’t determine whether there was actually a need for their product/service. 

Even if there is a need, if you don’t market, it means you’re not going to have sales. 


This includes activities leading to the sale of goods/services. Where we typically fail is in the follow-up. We fail to follow up because we get busy. 

When you’re no longer busy and you try to go back to those leads, they’ve gone cold. Maybe they found somebody else to solve their problem because you didn’t follow up with them. You lost a sale. 

Sometimes, we even have to follow up multiple times. John Asher’s premier sales training says we might have to follow up somewhere between 5-12 times. So if you’re someone who stops after the first 3 times, and I’m not saying you have to be irritating, what are you going to accomplish?

We’re hitting the era of what they call smarketing, because sales and marketing are starting to blend together. It’s easier for you as an entrepreneur to blend those two together. 

Business Development 

Business development is not like sales. Rather, it’s the strategic development of partnerships to promote your product/service. 

You’re partnering with other businesses in order to get customers. These are always great because you typically deal with a few partners, but you could end up with a lot more sales. This is because they’re the ones engaging with their customers. 

In my case, a strategic partnership for Defy The Status Quo might be a digital marketing company that doesn’t do content but wants to offer it with their services. They either want a referral partner, somebody they can refer a business to, or they want to bring us under as a subcontractor. Those are business development opportunities for Defy The Status Quo. 

There are almost always other types of opportunities that you can take, whether you have a service or a product. That’s your business development. 

It helps when you find people who are in similar fields. What about when you find someone in the exact same field as you? In my case, as a B2B writer, my company does B2B content for consulting and service firms. 

What that means is that, if somebody comes to me about healthcare writing, that’s not my company’s area of brilliance, so I’d think of healthcare writers I know that I could refer to. 

That’s another business development task that doesn’t necessarily bring you revenue, but if you do that for your peers, it’s very likely that they’ll do it for you in return. Also, you’ve avoided giving a potential client who reached out to you a firm no

Make the Best of Outsourcing

So in order to solve this problem, outsourcing or bringing in employees who can do these functions is key. 

Outsourcing is typically what you do first, because you may not have enough for a full-time or part-time employee. 

You can read my blog post (or watch the video) on how Outsourcing With a Virtual Assistant Can Generate More Revenue here.