5 Problems Most Entrepreneurs Face When Starting a Business
Lots of new businesses open their doors each year, and while it's an exciting time for owners, it's also the most difficult. A third of these businesses won't survive two years, and half won't make it to the five-year mark.
When running any business, the most valuable resource is almost always time. The multitude of small, time-consuming headaches owners have to deal with often compound into large-scale nightmares.
So what are 5 of the most common problems faced when starting a business?
1. Money Counts
Every startup needs money in order to operate or else it’s doomed. Let’s not sugar coat it.
For one, you’ll keep on paying bills even if you don’t make a sale.
Also, as a business owner, you may have to skip taking a salary in the first few years. You may even have to pour your entire life savings to your firm just to keep it up and running.
Because of these cash flow issues a lot of starting businesses are forced to close even before they get the chance to rise above the competition. But it doesn’t have to be this way.
Careful and conscious financial management and budgeting can overcome this hurdle.
Yes, you’re going to spend money on bills, manpower, and inventory whether you like it or not, but you need to resist the urge to spend on items that can be bought or paid for at a much later time.
Being savvy is vital. Keeping a part of your money for the “rainy days” can help you avoid having to borrow money from financial institutions for when this season comes.
“Fail to prepare? Prepare to fail!”
Another way to extend your cash flow is to negotiate with suppliers or vendors.
If you can form a good relationship with them, you’ll probably get discounts or better deals when it comes to subscriptions or items in your inventory.
Even the smallest savings can help with your finances, so don’t take this opportunity for granted.
Every penny really does count!
2. Communication Issues
While recent technology has improved business communications in many ways, some issues regarding communications remain unsolved.
These problems often have a major impact on how a small business performs and they usually affect key stakeholders.
Here are some of the most common communication hurdles small businesses face:
• The lack of communication with stakeholders. You’ll need to communicate the progress or delays in every undertaking because small issues can oftentimes get blown out of proportion.
• Missing important calls or messages. Customers these days often frown at missed calls or voice messages as those can lead to missed business.
As a business owner, you must always have access to every communication channel available,
for example: voicemail to email, and the like so that you’ll never miss out on any opportunity.
Those tools can also help you respond to pretty much anyone in a timely manner.
• Disconnected employees. Most modern small businesses thrive in a virtual environment.
They have field workers, remote employees, and office-based personnel.
Such arrangements can result in a communication nightmare that would often snowball into limited productivity, keeping on top of communication networks and addressing any barriers that are in existence or have the potential to exist can save a lot of hassle and avoid discontent in the future.
3. Human Resources
Hiring people is one of the major problems faced when starting a business. Some specific issues around human capital include:
• Unqualified applicants. Finding top talent can be challenging for small business owners who do not have the resources needed to hire personnel for specific positions. For such cases, recruiting people within your network can be your best bet.
• Hiring for convenience. Because of the lack of time and money, some businesses fall into the trap of making hiring decisions propelled by cost-effectiveness and time pressure.
Positions that are sculpted to fit a candidate’s skill (and not the other way around) can be detrimental to your business in the long run. Maintain focus on value when hiring people more than anything else.
• Competition. You might find yourself vying against bigger organizations when it comes to applications. Bigger companies have the advantage of hiring recruiters to find the best people.
Just rest assured in knowing the right person is out there for your needs but you may need to be patient in waiting for them to emerge.
4. Quality and growth
Another challenge that small businesses need to face head-on revolves around growth. When the time to expand comes, you have to ensure that the quality of the goods or services you offer remains the same.
Scaling doesn’t automatically mean that you have to compromise your standards.
Remember, quality is probably what attracted customers to your business in the first place.
5. Keeping Passion Ignited
When you were starting, it all seemed fun. You’ve designed every process to go as smoothly as possible. But when the customers start complaining, when the deliveries start arriving late, and when the lawyers start calling, you may instantly notice how your stakeholders start to look like monsters clawing away at you.
Every day, before you do anything, remind yourself why you started your business.
This is important for you to stay motivated and engaged, and it is important for your business’ potential. Your passion inspires you and everyone around you.
It dictates why you do what you do and why your business exists and contributes greatly to why successful people are successful.
Running a small business comes with plenty of challenges and there are many problems faced by entrepreneurs starting a business, but that's part of what makes it such an exciting experience.
It’s important to just remember why you started and stay focused on your goals even when times are tough in the initial start-up, it’ll be worth it.
Now more than ever with all that's going on in the world with this weird virus it's important to grow your business online.
Click the 'Green Button' and schedule a 1-one-1 growth planning session and discover how to start growing your business online today...