Small businesses struggle for many reasons. Many small businesses close down in their early stages of operation, or never quite attain the degree of success as early as they had hoped to. And the reason for this most of the time, it's because they may not have anticipated the obstacles and challenges ahead.
In an effort to deal with some of these challenges and to help you plan and to prepare yourself for the unforeseen, below I have shared with you some of the common challenges and how you can tackle them.
The saying is "cash is KING," and Yes, you need money to grow and run a successful business. Unless you're remarkably lucky and are able to access funds from sales or investors, if that is not the case then, you will be in trouble. Cash flow issues will hit you hard, either delaying the rollout of products, hiring key staff, or fitting out new offices. To achieve all of this, you need money.
You will need capital to fund software or product development, office space, marketing (yes, you'll need that too), and yet from it, most success flows. The last thing a startup need is to manage costs and only keep staff when you need it so you can to focus your energies elsewhere.
My experience share: Understand every expense and why we need to spend and ensure you save a portion and invest back in the business, as this method has paid off for me.
2. Neglecting marketing and sales
Other small companies encounter problems because they don't put enough resources and effort into marketing or selling their products. Sometimes they ignore this part entirely and put their faith in word of mouth, with the hope that sales will grow organically via their online presence.
In a competitive economy such as ours, it's unrealistic to hope for your customers to discover your business and offerings organically unless you make a concerted effort to grow them with a properly structured plan to promote your startup. Prioritizing this when you start, will make your startup increase the chances of your startup to survive.
My experience share: Focus on recruiting sales (even if you start on a commission model, affiliations, partnerships, and cold calling this will help.). Use every online marketing platform available and post content and have a small budget to recruit an audience that might have an interest in your product.
3. Hire the right people
As business owners, we tend to take short cuts when recruiting staff members. I have had my fair share of misfortunes regarding this, and I've really learned a lot through the mistakes I've made, and really growing in understanding the specific skills that are crucially required for my business to survive, and grow. Knowing the exact skills needed – and how to get those essential people – may determine how well your business thrives. Delays in finding the right people will only eat up valuable time but also lead to severe bottlenecks, perhaps delay the rollout of new products or services. These are delays no small business can afford. You may also have hired the wrong people, and their deficiencies may be more apparent as your business grows, especially if they are in the wrong role it will be visible when a business expands, and the cracks suddenly appear.
My experience share: Understanding the role required before recruiting, anyone understanding both the negative and positive impact for your business. Ultimately hire slow and fire fast
4. Lack of Planning
It's amazing how many small businesses fail because they forgot to plan, and even if they have a plan, they don't execute their planned strategies. Or perhaps they did, but just never covered all the bases. Critical areas like sales, development, recruiting, and funding should be part of your business plan or be flexible enough to cope if events take an unexpected turn. Contingency planning is vital, but so is a proper plan and execution strategy. If your plan is all optimism and fails to allow for surprises – and you can bet your life they're just around the corner – then you're heading for big trouble. Get the details right, no matter how small.
My experience share: Learning to book yourself out your businesses and work on the company once a week, and I follow through with a definite 90-day goal plan with clear deliverables, which I must do weekly to accomplish all the goals set within a nighty day period. Always ask yourself or board of executives what could go wrong, and find the solution to mitigate the problem upfront.
5. Lack of Mentorship
You may have a great product/idea, but lack the necessary guidance, market experience, and knowledge to move a stage further. That's where a mentor comes in, and sometimes these mentors described can be found by reading a book, attending a networking session where you can interact with other like-minded small businesses in your area. Mentors can also help you strategize better a good resounding board.
My experience share: I read a lot of books and spend most of my leisure time online researching. On top of this, I also attend network sessions, and I interact with other business owners in my community which help me learn through their experiences.
Small businesses encounter a lot of challenges and the above mentioned are just a portion fo them. Hopefully, with the tips I've shared with you, along with my experiences, you will be able to prepare, plan and avoid repeating the same mistakes I did.