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Top 7 Challenges Small Business Owners Face
Challenges Small Business Owners Face
There have been numerous problems facing business owners. This has put fear and panic into new entrepreneurs who have the ambition of starting their own businesses. Small business owners just like big business owners, make many decisions on daily basis. However, the decisions that small business owners make are mainly on how to survive. This has made things really difficult for small businesses. This post looks at some of the major challenges small business owners face and how to overcome them.
No matter how hard you try, there is always a problem to solve and fires to quench. Most entrepreneurs are not prepared for these problems. Generally, as a business owner you should always prepare to come across challenges in your business or prepare to take risk. There have been major challenges which all small business owners go through. Many of these business owners are still struggling with solutions. Here is some of the obstacles that small business owners face:
Have Time to Plan
Time to Plan
Time has become one of the major challenges small business owners face. It is important for business owners to manage their time profitably. Planning in advance and ensuring that things are done on time is essential for the success of the business. Most small business owners spend more time working in the business but not on the business itself. Although it is important to ensure your customers are happy, it is better to develop a business plan. Business owners should make business schedules which will always be favorable to them and must stick to it. Planning for future projects and making adjustments accordingly are very necessary for the success of any business.
Many entrepreneurs are excited to set up their own business. However, they fail to prepare better and proper business plans. The business plan helps businesses to focus on their goals and achieve their target. Spending time to plan effectively can save money and even earn you more money in your business.
LITTLE TO NO SAVINGS.
Many small business owners always anticipate for bigger and instant profit without taking certain things into consideration. These business owners invest less but want bigger income. Because of this type of mindset, they invest the little revenue they gain without saving much. They go the extra mile to take a risk which can collapse the business. It is significant for business owners to understand that you can’t earn a bigger profit instantly when you start a business. It is advisable to start slowly, patiently and save more, so that in case of any skirmishes in the business you can use your savings to revive it.
Cash flow problems
Cash Flow Challenges
It advisable for business owners to keep their eyes on their cash flow. This is because it will enable them to know the liquidity level of their business at any given point in time.
As a business owner you must dedicate time to manage your cash flow. If you have cash flow challenges, it signifies the poor state of your business. It is good to prepare your businesses cash flow statements on regular basis. This will help you know what your cash balances are at all times and also prevent you from overspending whiles assisting you to keep track records on the movement of cash in your business.
INSUFFICIENT KNOWLEDGE AND SKILLS IN THE BUSINESS
This is one of the mistakes made by most entrepreneurs; they enter into businesses without having sufficient knowledge or skills about the business. It is important to have much knowledge and skills about a business you engage yourself in; as this will help you map strategies to survive and expand. You must possess the skills needed to startup a business. If you are not prepared enough you need to educate yourself or see business consultants for advice. Do proper research, consult other business owners who are already in the business and have a lot of experience. You can also read more books related to the area of your business.
LIMITED ACCESS TO CREDIT FACILITIES
One of the major challenges small business owners face is their ability to access credit facilities. Due to their (small businesses) small nature and little experience in management most credit providers feel reluctant to provide them with little to no financial assistance. This is because small businesses have low credit ratings by credit providers. The question is; what should they (small businesses) do? Well, there is very little small businesses can do when it comes to securing huge financial support from banks for instance. However, they should consider other small credit providers who might be willing to assist them in their bid to grow. Venture capitalist, families and friends are just some sources of funding that can be easily tapped into by small business owners.
Small businesses face difficulties in getting the right and experienced labor force to work with. Due to their small nature, they find it difficult to attract highly qualified and experienced employees. The solution available to small businesses for such a challenge is by investing in training programs for existing employees. These training programs would help equip their (small businesses) relatively inexperienced staff with new skills, hence bridging the gap between experience and inexperience, which is sometimes the difference between big companies and small companies.
SMALL MARKET SHARE
A business whose sales are very low would find it difficult to survive. New or small businesses find it very difficult to break into tough markets and get a share of theirs. This leaves small businesses with little and insignificant share of the market. This is a big challenge faced by many small businesses. Their inability to break into the market and secure some significant portion of the market share can be disastrous to their growth. This problem emphasizes marketing issues. It is understandable that small businesses face marketing problems because of financial constraints which prevents them from employing the best marketers or engaging in bigger and intensive marketing. However, there are some very effective yet inexpensive marketing strategies that small business owners can adopt for their business.
The challenges small business owners face are numerous and as a business owner you should have one thing in mind, and that is your preparedness towards the challenges ahead. Don’t be afraid of the obstacles in business, identify solutions to tackle them. In the end your perseverance would pay dividends.