Startups are known to have specific needs that larger companies won't understand. These needs inevitably become challenges for business owners. Issues such as inexperience, company size, and lack of resources can hinder an entrepreneur's success.
ContentsMoney MattersCommunication IssuesHuman CapitalQuality and GrowthStaying PassionateIf you're having any of these issues, here's some good news. Here are some of the biggest problems faced by small businesses and what you can do to overcome them.
They say cash is king and that rings especially true for small businesses. Every startup needs money to operate.
On the one hand, you will continue to pay your bills even if you do not make a sale. Also, as a business owner, you may need to avoid earning a salary for the first few years. You may even have to pay your entire life into your business to keep it operational. Due to these cash flow issues, many start-ups are forced to close before they even have a chance to outpace the competition.
So how do you approach these questions?
Well, it starts with managing your finances.
Sure, you're going to be spending money on invoices, labor, and inventory whether you like it or not, but you have to resist the urge to spend on items that can be bought or paid for a lot more. late. Saving some of your money for “rainy days” can save you from having to borrow money from financial institutions for that season. In other words, don't dry yourself.
Another good way to increase your cash flow is to negotiate with suppliers or vendors. If you can build a good relationship with them, you'll likely get discounts or better deals when it comes to subscriptions or items in your inventory. Even the smallest savings can help you with your finances, so don't take this opportunity for granted.
You can find additional income streams to supplement low income months. For example, if you own a small restaurant that caters to tourists at a ski resort, you might want to consider offering catering services during the low season. Or, if you own a small boutique and focus on selling Christmas ornaments, you might want to expand into home decor a little at a time.
Although recent technology has improved business communications in many ways, some communication issues remain unresolved. These issues often have a major impact on the performance of a small business and usually affect key stakeholders. This includes employees, customers and third-party vendors.
Here are some of the most common communication barriers small businesses face and suggested actions to help alleviate or overcome each problem:
• Lack of communication with stakeholders . Whether it's setting company goals, implementing new policies, or even tracking orders, it's important to keep those involved in a project or transaction in the loop at all times. You will need to communicate progress or delays in each undertaking, as small problems can often be out of proportion.
• Missing important calls or messages. Customers these days often frown on missed calls or voicemails because these can lead to missed business. As a business owner, you should always have access to all available communication channels. Leverage tools like call forwarding, business texting, voicemail to email, and more. so as not to miss any opportunity. These tools can also help you respond to almost anyone in a timely manner.
• Disconnected employees. Most modern small businesses thrive in a virtual environment. They have field workers, remote employees, and office staff. Such arrangements can result in a communication nightmare that would often snowball into limited productivity. Thus, a decision maker must cultivate a collaborative virtual space that will keep everyone connected.
For geographic constraints, you can make video conferencing a standard practice. For team communication, there are tools that enable discussions with task management and collaborative office productivity components. The possibilities are limitless; you just have to know where to look.
In the year-long State of Small Business Report by Barcode Wasp, he states that 50% of small businesses say hiring new employees remains a major challenge in 2017. Considering this statistic, it is quite evident that hiring people can be a daunting or overwhelming task for business owners.
Below are specific hiring or labor issues among startups:
• Candidates not qualified. Finding top talent can be difficult for small business owners who don't have the resources to hire staff for specific positions. In such cases, recruiting people from within your network may be your best bet. Find friends or contacts who can sponsor or guarantee potential employees; they probably know enough about your business to have already done some kind of recommender screening.
• Rental for convenience. Due to lack of time and money, some companies fall into the trap of making hiring decisions driven by profitability and time pressure. Positions that are molded to match a candidate's skills (and not the other way around) can be detrimental to your business in the long run. Be sure to focus on value when hiring people more than anything else.
• Intense competition. You might find yourself competing with larger organizations when it comes to apps. Big companies have the advantage of hiring recruiters to find the best people. They would likely offer higher salaries and unlimited benefits to good candidates.
However, there is also a group of talented people who prefer to work for a less bureaucratic organization. They prefer jobs with more flexible policies and more room for growth. You need to highlight these benefits in order to appear more appealing to your prospects.
Another challenge that small businesses have to face head-on concerns growth. When it comes time to grow, you need to make sure that the quality of the products or services you offer stays the same. Scaling doesn't automatically mean you have to compromise your standards. Remember that quality is probably what drew customers to your business in the first place.
As soon as you enter this phase, you should establish and implement clear quality control models. For example, if you have a sales team of 10 people using the same script on the phone, you may need to record calls and measure call data once you grow to a team of 50 people. This helps ensure that this script is still appropriate and that customers receive the service they expect from you.
You need to be able to delegate people who can take responsibility for ensuring product quality. Their roles must be well defined. On top of that, you need to impress upon your team that you are currently going through a growing season so that your employees feel more responsible for the tasks they are doing.
When you started, everything seemed fun. You have designed each process to go as smoothly as possible. But when customers start complaining, when deliveries start coming in late, and when lawyers start calling, you might instantly notice how your stakeholders start looking like monsters clawing at you.
And once you stop recognizing how good your business serves a purpose, that's when things start to go haywire. You will drain all your energy and fatigue will seep in.
Staying inspired to move your business forward can be a challenge, especially when you're facing so many obstacles. Some people choose to give up immediately while others succumb to running their business like zombies.
You don't have to.
As Leslie Barber writes in Entrepreneur, "Before you do anything, remember why you started your business." You have to stay inspired by the ideas and you have to nurture your people. You need to figure out what aspect of your business needs your full attention and be ready to put in the work to create better products or services.
Understanding the major issues faced by small businesses can help you better understand how to continue to run your startup with minimal hurdles and a greater chance of success.
See also:The 3 secrets of successful small businesses
Author bio
Klaris Chua is a digital content marketer who has written numerous articles on startups and small business communications. She was once a reporter for a business newspaper, but the conventional path of a writer didn't sit well with her. You can connect with her on Twitter.
