Entrepreneurs must undergo a plethora of challenges when they start their own business, because small businesses need to be nurtured properly to flourish. Every small business, irrespective of what industry it belongs to, faces challenges it must overcome to ensure its survival and growth. These can range from building your brand, hiring talented employees, and cutting down on overhead expenditure.
The state of the economy isn’t kind for small businesses, and they must deal with the challenges in the appropriate manner to have any chance of survival. Small businesses must face both small and big challenges, which will determine the success and survival of the enterprise. Business owners must identify these challenges beforehand so that they can solve the problems and guide their business down the right path.
Most entrepreneurs tend to struggle with a new business, simply because they don’t understand the scope of the challenge and aren’t prepared to solve the problems they will encounter. The first part of resolving any problem is to identify and understand it. So, if you’re running a small business or thinking about starting one, here are the four biggest challenges that your small business will face.
1. The Tiredness Factor
As a small business owner, it is going to be all hands-on deck during the first couple of years. You must do everything yourself, which means long hours, intense pressure, and mental fatigue. Most business owners don’t account for the tiredness factor in running a small business, and by the time they realize the problem, they have already made grave mistakes.
Fatigue can cripple the thinking of any entrepreneur, since it makes you cranky, inattentive, forgetful, and disorganized, which can spell disaster for your small business. That is why you must pace yourself, and embrace the challenge of running a tight ship during the first couple of years. The enthusiasm, motivation, and energy you extend when running your small business will quickly evaporate if you don’t delegate tasks to other employees. Don’t try handling everything yourself, and it is better to only focus on things where your expertise lies.
While it is important that you remain on top of things, it shouldn’t come at the cost of overworking yourself or burning out. You can hire specialists and delegate crucial tasks related to legal matters, and accounting to them. It will not only help save time, but will save you a lot of stress and headaches. Come up with a plan and stick to it, so that you are not only running your business smoothly, but can also manage a healthy work-life balance.
2. Problems with Cash Flow
Another important challenge that all small businesses must deal with is the cash flow issue. You will invariably have money problems, which is why it is important that you plan and budget well in advance. Your small business is not going to start turning over profits in the beginning, and you must account for errors, mistakes, and unaccounted for expenditures during the first couple of years.
Small businesses generally face issues with outstanding bills, clients stalling payments, and unexpected costs, which can cripple it financially. That is why you must have a plan in place to deal with this problem, and there are lots of money management tools available that can help you with that. Managing your cash flow is going to prove to be a challenge initially, which is why you need all the help you can get.
3. Motivating Your Employees
Any small business that wants to make a name for itself needs to have highly motivated employees. Your employees should buy into the business vision of your organization, since that is the only way they are going to take their jobs seriously and make a serious impact. To motivate your employees, you will need to invest some time to understand them, more importantly what motivates them, and how to get the most out of them.
Boosting employee morale will lead to more engagement within the organization, which will translate into a smooth-running operation. Good companies nurture an open and relaxed atmosphere, where the staff feel comfortable in talking and voicing concerns to management. Including perks like Christmas parties, free snacks and free coffee for the staff will also help motivate employees.
To gauge the proper method for motivating your employees it is necessary that you communicate with them, and acquire employee feedback. This will help you understand their needs, which is critical in getting everyone on board the organization. Businesses that ignore what their employees want, and assume everything is fine, are often left wondering why they are suffering from high-staff turnover. This is a common small business problem that must be dealt with.
4. Finding and Retaining Profitable Customers
There is a business term that states that to ensure success for your business, you must find customers with a problem and offer them a solution that works in their favor. That can prove to be a difficult task, because in general you won’t be the only business in your industry with the solution. That is why you need to work on identifying your unique selling point, and then market yourself effectively to your audience. This is the best way to find profitable customers, but that is only the beginning, the hard part is retaining those customers.
The only way you will be successful here is if you start researching about your customer base, and learn about their characteristics. This way you will be able to identify their best customers, and you can then easily analyze the value they bring to your organization. After doing so, you will be able to expand your efforts into attracting new clients that will help bring value to your business.
These challenges are faced by all small businesses, and rather than fear them, entrepreneurs should embrace them and prepare for them. One of the worst mistakes any business owner can make is not account for the challenges that their business will face. That is why we have tried to make things easier by highlighting the 4 biggest challenges that small businesses face.