Obstacles That Small Business Owners FaceWritten by Mindaugas on August 20, 2018
Life endows us with hurdles that we must overcome in order to keep moving forward. Obstacles that small business owners face are plentiful as well – they can stifle growth and overall development of you venture.
No business is immune to hurdles, and a lot of them are universal – no matter what industry you operate in, similar obstacles can be encountered. How you choose to act once confronted by a complication on your entrepreneurial road will dictate the outcome of your business.
I conducted some research on the web and also had entrepreneurs disclose their first hand experiences on the hindrances they have dealt with. Let’s dive in and see what obstacles small business owners face on their path to greatness.
Getting Your Hands on More Capital
Many small businesses employ reckless means in order to raise sufficient capital. It’s a simple case of “eyes are bigger than the stomach” – doing anything possible to get cash. Taking on investors or invoking the help of a bank to secure a business loan are valid options, but are not always a necessity.
What may seem like a simple solutions that generate capital quickly, often times come with strings attached. You may have to forgo a percentage of your company to investors and let’s not forget the debt and increased interest rates that are the culprit of bank loans.
Self-reliance can go a long way. Bootstrapping is a very real and viable method of business development. Minimize operating costs while retaining full ownership of the company and not taking on any additional debt.
While bootstrapping your venture, the growth may not be as prominent. This may actually prove to be useful since the growth rate can become more manageable, and there is less chance to succumb to frivolous spending.
If one or two clients are the source of most of your income, you need to quickly assess your situation. If they were to ever pull out, your business could come crashing down – diversify your revenue streams for increased financial security.
Perhaps at first, it sounds convenient only having to appease one or two clients to get the bulk of your revenue. Not having to rely on marketing or further product development in order to attract paying customers. This is a dangerous slippery slope.
The fate of your business rests in the client’s hands. Your bargaining power shrinks since you’ve built up a dependence and if they ever jump ship, you’re left out on ice.
Never put all your eggs in one basket. Continue to attract new customers and bolster relationships with your current clientele.
Customer Acquisition and Retention
Getting your business noticed by more than just your friends is part of the game. Developing a brand and incorporating the right marketing techniques will build rapport among the audience.
A lot of businesses rely on a strong online presence to garner the attention of their audience. It’s accessible and has the potential to entice a large audience that may be scattered all over the world.
Inbound marketing for example, is aimed at cultivating familiarity with a company, which lends a hand in easing the consumer into the buying process. By providing value through well-orchestrated content creation, an individual is more likely to commit their time and money to you.
Loyalty and referral programs can be a surefire way of retaining the customers you have acquired thus far. Not to mention referral programs employ your business advocates to persuade their immediate acquaintances to hop on board too.
Keeping Up With Consumer Demand
An idea can get off the ground and evolve into a beast that cannot be tamed. Business can ramp up too quickly causing your infrastructure to buckle. A labor shortage or an inadequate production capacity can reduce your company to rubble.
Don’t get caught off guard by a sudden influx of customers. Marketing and promotional efforts can produce incredible results quickly, that do lead to higher demand. Have a strategy in place that allows you to efficiently scale up operations when the demand surges.
Although keeping up with the demand is important, it should not be done at the expense of quality. Maintain stringent quality standards both in product development and customer support, throughout the scaling process.
Employing the Best Talent
Having a great team on board is at the top of the wish-list for many businesses, but not every business is able to recruit the right members. These are people that represent you and your company and continue to grind on your behalf.
We live in the digital age that has enhanced our ability to reach out. Accessibility to qualified staff has never been greater – you are able to employ individuals outside your city or country without sacrificing productivity or quality.
If you’re unable to secure the right people for the job, don’t confine yourself too much; look outside the box you have been confined in. Remote teams are a viable solution and have become the norm for over 60% of businesses – these numbers will only get bigger.
Productivity and Motivation
Hitting the ground running and keeping the momentum going day in and day out can be exhausting. The level of productivity you have come to appreciate shouldn’t falter nor should the motivation to get the work done.
The things that are aimed at increasing productivity and motivation within the workplace may not always be so cut and dry. For example in one scenario, a simple tweak in lighting within the office managed to boost productivity by 18%, while 76% of workers reported to feeling much happier than before.
Look at your own business and the people within. Inquire your employees about potential motivating factors that could be applied. Bonuses, flex-time, and various amenities around the office could be motivating factors that enhance work ethic and productivity.
A range of online tools are also accessible that bolster communication and collaboration within. Whether you’re dealing with remote staff, managing time or budgets, many of these productivity tools can aid you.
Maintaining Fiscal Awareness
Scrutinizing the financial information is critical. Being aware of your cash inflow and outflow is something that needs to be done, but often times is left on the back burner.
Online invoicing solutions, budgeting systems, and payroll software are all great ways of tracking all the cash that enters and leaves your business. It makes forecasting easier, which may be necessary to appease your investors, and mitigates the possibility of running into cash flow issues down the road.
Standing Out From the Competitors
You are probably not the only one operating within the industry, usually there are competitors you must go head-to-head with. Attempting to set yourself apart from all the similar businesses out there can be a challenging undertaking.
How you go about branding yourself and reacting to consumer suggestions will impact your ability to stand out. Knowledge of your competitors will also play a key role here. Evaluate your competitor and look for any faults or inadequacies. By doing so, you will be able to improve your own product.
I also mentioned that your branding efforts play a pivotal role here – it cultivates perception of your business for your audience. Your brand will resonate not only the product or a service you have created, but all the values and principles that your company stands by.
Be sure to continue gathering feedback from your consumers. This has the potential to open your eyes to any faults that were overlooked further improving your product.
Abiding By Government Regulations
Government regulations and various laws are constantly evolving. In order for a business to continue its operations and avoid any sanctions, it needs to stay vigilant of regulation dynamics.
Various industries are bound by different regulations – some are more difficult to embrace than others, but alas, it must be done. Staying up-to-date on the latest regulatory measures can mean the difference between your business continuing its operations or be faced with legal consequences.
Some regulations have far-reaching influence. Most recent example of this is the General Data Protection Regulation or the GDPR that was implemented by the EU. It affected all businesses around the globe – they too began abiding by the new privacy standards that were mandated.
Understanding regulations and laws, and implementing changes to go along with them isn’t always easy. The necessary changes could put a damper on further growth or could cause a surge in additional business.
If there is ever a time when you’re not sure how to proceed with your development due to regulations, reach out to a lawyer. Don’t let your tenuous grasp of legal terms be your downfall.
A lot of can rest on the head honcho of an enterprise. As a business owner, you may be subject to much longer work hours while constantly maintaining the integrity of your business. Prolonged periods of stress coupled with the rigors of managing can lead to burnouts.
Don’t get enveloped by the grind. Making time for yourself and family is great both for mental and psychical health. Create a schedule that’s dedicated for all activities unrelated to work – stick to it. It will also help you plan out the work schedule that conforms to your hobbies and family time.
As I mentioned before, employing the right people can minimize the risk of burnouts. A team you can count on takes some of the weight of the shoulders and removes the need to micromanage all aspects of the business. Trust and camaraderie within let’s you distribute the burden while making time for yourself.