Thriving in today’s market is a challenge particularly for small businesses. It can seem even more difficult to start a business with all the larger corporations surrounding you. But that is not the only problem small businesses may encounter, others can include: customer inconsistency, money, marketing today, lack of employees and family.
I think a quote by John Quincy Adams says it best: “Patience and perseverance have a magical effect before which difficulties disappear and obstacles vanish.”
In honor of President Adams, keep persevering and have patience! There is hope yet for small businesses if you address your issues at hand. Don’t sweep them under the rug!
When starting up a business you may have little to no customers or clients, which results in a questionable paycheck. Keep in mind that as a business develops, so does the number of customers. If you are already in business and your client numbers begin to dwindle, then you may start to panic. But it is a forever changing market; people will come and go with no foretelling at all.
However, if your business is solely relying on a few top customers, then you may run into a bigger issue down the road. Investopedia suggests diversifying your client base from one main customer to many in order to provide financial stability and growth for your small business.
“Diversifying the client base is vital to growing a business, but it can be difficult – especially when the client in question pays well and on time,” says Investopedia. “For many small businesses, having a client willing to pay on time for a product or service is a godsend…However, it is generally better for a business to have a diversified client base to pick up the slack when any single client quits paying.”
Money, money, money! Money is all anyone ever talks about anymore! Well, it’s kind of obvious why. Issues with money are not new. People have been struggling with finances since the creation of money; from earning it to saving it for the future. Most likely this issue will never be resolved in its entirety while money is still around (so like never…).
Getting noticed without spending a fortune can be a major hurdle when trying to grow a business. How do you know where to spend your money to make money? What is the best investment I can make to see a return on my money? As an entrepreneur, you might have more questions than answers. However, researching your community, city and state will help you find solutions you are looking for. Performing this research will provide you with common knowledge amongst your audience and competition.
For example, do you know who your competition is? What about your target audience? Before advertising, look around for the best price with the best location to reach your target audience and beat out your competition. Don’t make quick, irrational decisions – do your research first!
Marketing yourself today is entirely different from marketing yourself 5, 10, 15 years ago. If you are new to the marketing world or if you have been a member for awhile, knowing where and how to advertise are never ending questions. Think of marketing as a book, every year new chapters are added and old ones are archived. Staying up to date is half the battle!
Small businesses today particularly struggle with understanding the web and configuring social media. They are faced with the challenge of marketing themselves using today’s tools. Transitioning from the old ways can be rather difficult for small businesses that have been marketing for many years. Some might ask if they should put themselves in the yellow pages or if advertising in local newspapers is too old fashioned?
Fortunately we have put together some great resources to help answer some of those pertinent questions! Take a look at a few of our blog posts covering this subject area:
A small number of workers may be another problem for small businesses because employees face each other on a day to day basis. They have to answer to each other in person when mistakes are made and everyone holds the other accountable. Taking on responsibility is important and not taken lightly. Equal weight matters!
Employees of small businesses also wear many hats, which can be difficult to hire for. This not only means it is expensive to train but time consuming as well. Today, people move through careers much more often than they did in the past. The turnover rate is higher than ever, therefore chiefs and founders find it easier to keep the workload instead of sharing the responsibility.
Another challenge small businesses might face is the high dependency of their chief or founder. Any business that can’t survive without its chief or founder is a business close to death. Founders or chiefs may find it difficult to move from tradesperson to entrepreneur because of the emotional tie to their business.
“Many businesses suffer from founder dependence, and this dependence is often caused by the founder being unable to let go of certain decisions and responsibilities as the business grows,” said Investopedia. The article went on to say it is easy in theory for founders to relinquish responsibilities but harder to put into practice.
Sometimes a small business might be owned and operated by a family. This, in itself, can stir up challenges. Large corporations have to answer to a board of directors whereas family businesses have to answer to the family. When discussing important decisions, keeping personal emotions at bay can be more difficult than portraying a professional appearance.
It’s easier to trust or hire a family member because they’re family though it’s harder to fire them or adjust their responsibilities, however necessary, because they’re family.
As a family business, laying down a strong foundation with rules pertaining to how the business will be ran is going to be crucial. Without a set of agreed upon rules, a family business can go down in an instant. Together, the family should lay out a detailed plan on how to handle potential problems that may come up in order to prevent any family feuds.
It is safe to say there are many, many challenges small businesses may face, including:
However, you must have something people want, or you wouldn’t be starting a business or already be a part of one. Paul Graham says it well:
“If you make something users want, you’ll probably be fine, whatever else you do or don’t do,” said Paul Graham, co-founder for the Y Combinator seed capital firm and Viaweb. “And if you don’t make something users want, then you’re dead, whatever else you do or don’t do.”
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