The Top 4 Challenges Facing Start Ups
Posted on February 1, 2014
The Top 4 Challenges Facing Small Businesses
Just being able to start a small business is already a big achievement, ask any entrepreneur. I was quite the happy camper when first managed to set up my web page. Of course, maintaining it is another matter altogether. More of a challenging hike full of bugs and weird plants and even weirder companions than a leisurely trek. And I’m sure I’m not the only one with those issues. Large or small, setting up a business and maintaining it is no walk in the park. What are the biggest challenges you can encounter along the way? I list down 5 of the most common ones.
Yes, clients are a challenge. They’re a problem when they aren’t there, they’re a problem when they are. The first case is self-explanatory, I think. You don’t have a business if you don’t have clients. It’s that simple. The second case is trickier. It’s when you do have clients but you develop a level of dependency that’s debilitating. It’s when you depend on one client for half your income, maybe more. That means losing them can pretty much break your business. The simplest way to address that is to diversify, but that’s easier said than done.
When running a business, you need to have enough funds to cover your overhead. You need to have reserves to head off capital drain issues. Or maybe be heavily capitalized.
This is why many small business owners work a job while building a business at the same time. The extra cash is always needed. Of course, the split focus can make things difficult but running out of cash is worse.
3. Dependency on Founder
When you have spent so many hours working on your business, it’s hard to suddenly start delegating tasks to other people. And that develops a culture of founder dependency. The problem with this if anything happens to the founder, the business all but ceases to operate. And this is a big stumbling block for many small businesses.
With all the hours , effort and pressure from making sure the business performs, even the most passionate of people can feel fatigue. Many business owners put more hours into the job compared to their employees. They have a fear of the business not doing as well without their careful eye and because of that, devote any and all available time to looking after it. This can take a toll and make them feel burnt out and then you’re back to problem #3. Making a small business successful entails a careful balance of quality and growth. It must allow for the business to thrive without having the founder there all the time to oversee matters. At the same time, it must allow for diversified clients to keep a steady cash flow with lower risks involved. Any business endeavor comes with a set of challenges. But challenges are not death sentences. It wouldn’t really be good for an aspiring business owner to view them as such and give up at the first sign of trouble. Take challenges as they are and know that each one is just an opportunity to do and be better.