Your first few years of business ownership will be filled with challenges. The US Bureau of Labor Statistics reported a 20 percent failure rate among new businesses in the first 12 months of operation, with as many as 50 percent going under by year five. While these numbers sound scary, the fact is that many of the obstacles that led to these failures could have been overcome.
Below, we talk about the most common challenges new business owners face and how to overcome them.
1. Lack of Funding
Lack of funding can be a new business killer. Well-established companies can stand a slow week or two, but if a major client fails to pay their invoice, it could have serious implications for a startup.
Rather than giving up your salary or falling behind on bills, you have a number of business finance solutions at your disposal. From the cash in your clients’ unpaid invoices to the capital in your existing assets, you’d be surprised at what you can use as leverage with a reputable business finance organization. There’s no need to struggle just because your business hasn’t gotten off the ground yet.
2. Not Enough Time in a Day
As a startup owner, you’ve probably been conducting most of the daily business duties yourself due to a limited budget. This can be a powerful way to save money and accelerate your learning, but taking on too much can cause you to fall behind and burn out.
The best way to handle a lack of time in your schedule is to delegate duties to a partner, a trusted employee, or a freelancer. Hand over any work that doesn’t require your special touch, and free yourself up to focus on more pressing tasks.
3. Trouble Finding Good Help
To feel comfortable delegating, you need a team of people you can trust. However, most small enterprises can’t offer a hefty benefits package in their early days, making it difficult to compete with well-established businesses.
The good news is, there are plenty of talented people who love working from the ground up with entrepreneurs who have big dreams. The trick is to take your time and be vigilant in assessing applicants. Onboarding a new employee can be costly, so you want to do it right the first time. Send out a job description, interview suitable candidates, and decide based on the attributes that are most important for your business.
4. The Balance Between Growth and Quality
One week you’re in celebration mode after landing a new client, and the next, you’re struggling to keep up with the demand. Before too long, you’re practically living at the office, your employees are working overtime, and you’re looking for ways to cut corners to save money and time.
Working harder and cutting corners aren’t ideal solutions, but what else can you do?
First, you should hire temporary contract workers to help with the onslaught of work. Next, begin thinking about the changes that need to take place in your current practices and systems to accommodate the growth your company is experiencing. Lastly, don’t skimp on the customer experience. After all, it’s your clients who will ultimately keep you in business.
Launching a startup can be an exciting and overwhelming time. Feelings of trepidation and fear are common, as are the situations listed above. With a drive to succeed in your heart and the tips above in your mind, you can overcome every challenge and come out on the right side of the statistics.