Launching your own business isn’t for the faint-hearted. Unless you give your small business everything you’ve got–whether you’re starting a business at home as a solopreneur or opening up a small store in a strip mall with a few employees–your chances of success will be slim to none.
You’ll need plenty of courage to start and run a business. It will fuel your motivation to overcome one challenge after another in rapid succession. A sentiment expressed by Steve Jobs when he said, “I’m convinced that about half of what separates the successful entrepreneurs from the non-successful ones is pure perseverance.”
Here, then, are five major challenges faced by small businesses when they first open their doors:
1. Sluggish cash flow. Chances are that your small business didn’t start with an abundance of financing. In fact, it probably started on a shoestring budget, with the startup cost kick-started by a modest small business loan, your life savings, crowdfunding, or money borrowed from family and friends. Since most of this money will be used to take care of overheads, your small business may rely on sales, and since these will probably be slow in the beginning, it means that your cash-flow will also be sluggish.Instead of fighting this reality—insufficient funding and a low sales volume in the beginning—you, as an intrepid entrepreneur, should embrace it. One way to do this is to get some professional help from cpa services because accountants make it their business to figure out how to track the ebb and flow of money in and out of a business. Even if you’re pretty good at managing your own books, you simply won’t have the time—you’ll be too busy administering, marketing, and personally soliciting big-ticket clients.
2. Insufficient profitability: Once you get your business out of the sandpits by stabilizing cash-flow, your next big goal will be to increase the margin between your business expenses and the revenue you’re generating through sales. You’ll be doing all you can to bump up your profits as quickly as possible. Unless you’re working with a seasoned business mentor, chances are that you’ll be in the early stages of struggling to fine-tune your marketing strategies. It will take some time to figure out what products to buy and what products to drop, as well as what ads to scale up and what ads to cancel. Since all the numbers won’t be in yet, it will be difficult to make any meaningful decisions or call out any reliable forecasts. In short, a few emerging dynamics will have to be sorted out before your business can experience a surge in profitability.
3. Low Productivity. Although you and your crew will probably be working hard and working for long hours each day, your productivity isn’t likely to be high. This is because busyness will be used to mask inefficacy, bewilderment, and guesswork. However, in time, you’ll be able to identify significant business processes, develop a list of best practices, and scheme viable workflows. In the beginning of any business, it’s absurdly difficult to be productivity. Unless you know what you’re doing, you can’t figure out the most efficient way to get it done.
4. Insufficient connections with Influencers. It’s almost impossible to network when you’re preoccupied with a melee of tasks to do each day to run your business. As a result, your connections with influencers in your industry, if it exists at all, will be tenuous. It’s only after you start going out to trade shows, attending seminars, and going to conferences that you’ll be able to meet other business owners, swap startup stories, and get introduced to people who know people.
5. Fickle customers. Until you develop your brand, you won’t have loyal customers. You’ll have customers who show up out of curiosity, purchase nothing at all or only buy small things. Generally speaking, then, from your point of view, customers will be behaving in fickle ways. For instance, if you have a digital business, you’ll often find a profusion of abandoned carts. Customer loyalty will only kick in once people get to know, like, and trust you, which will usually occur after you’ve impressed them with your unique selling proposition (USP)…that is, clearly demonstrating to them why your special offers aren’t easily available elsewhere.
In conclusion, it’s important to keep in mind that these challenges are what you might expect in the nascent stages of a business. Many things haven’t been worked out yet, surprising new discoveries occur every day, and fresh mistakes continue to be made. However, it’s still important to recognize that these five challenges exist and to trust that they are only temporary. As your business matures, they’ll become fond memories that will make their way into marketing literature under the rubric of “founder’s stories.”