Potential Pain Points When Starting a Small Business
If you feel restless working for someone else and have come up with your own idea for starting a business, consider the challenges you will face ahead.
Owning and running a business is rewarding, but it comes at a price. Stress, mistakes, and sacrifice accompany the pride, excitement, and sense of accomplishment of creating your own money-making machine.
By knowing and preparing for these potential pain points, you will be better equipped to deal with complications when they arise. Challenges are almost guaranteed for entrepreneurs. However, you will need to use your creativity and innovative skills to overcome the difficulties you will encounter.
Raising capital
Your new business will need capital to operate. On the TV show "Shark Tank," business owners with great ideas pitch for more funding when they’re already pulling in noteworthy profit margins. In most cases, they give up a portion of their company to land an investment and grow their business.
Successful business owners have put everything they can into growing their idea: life savings, loans, income from their day job, and more. But they still need capital to turn their business into something that generates free cash flow.
Most likely you will not be taking a salary for yourself in the first year (or three) of your new venture. Wise business owners will funnel as much money as they can into their startup to see maximum growth before pocketing cash from the business.
Even as you sacrifice things like vacations to grow your business, you could be surprised by unexpected expenses that arise.
Unexpected expenses can include:
– Broken equipment
– Accounting mistakes
– Late fees
– Travel expenses
– Attendance fees for workshops and conferences
– Office items like toilet paper, take-out while you’re working late, and more
– Liability insurance
– Employee taxes
– Self-employment tax
Traditional loans, grants, angel investors, or crowdfunding support are practical ways to seek out investors. However, you could be turned down time and time again. Rejection can dampen your spirits, but keep believing in yourself. Your idea likely still has potential. You might need to seek a different type of funding or rethink your business structure to gain the interest of potential investors.
One way to boost your attractiveness to potential investors is to ensure that you have a strong business plan in place. If you are struggling to craft a clear business plan, seek out a professional writer or marketer with experience who can help you.
In addition, consider adjusting your business plan. This could involve changing the amount of ownership you’re willing to give to your investors or establishing a way to deliver a faster return on their investment. Your flexibility might excite a hesitant investor.
Attracting the right customers
To develop a great product, you need to cultivate the right users who can help determine the direction for your company. By narrowing down a specific market, you’re more likely to develop a product that your target audience must have, rather than a product that many people are interested in but few are actually buying.
When starting out, ask your target customers for their opinions. Listen to what they tell you, either through words or actions. They are your peers, your review group, or your test subjects. Your target customer will give you the best insight on what’s great and what’s not-so-great about your product. They can tell you what you can improve, what you can eliminate, what they wish it could do, how much they’d be willing to pay for it, and more.
For example, if you offer a gadget in six colors, but just three colors make up 90 percent of your business, focus on the colors that sell and eliminate the other colors. This gives you room in your budget to improve different features or contribute to your marketing.
On the other hand, if your customers tell you that they want a specific service or product that you don’t offer, pay attention to their suggestions and consider the feasibility of their ideas.
Trying to do everything on your own
Successful entrepreneurs know that they cannot do it all. If you push yourself too hard, you will wear yourself out, and you might even run your business into the ground.
A small business owner sets the company vision, focuses on the future, plans for emergencies, considers the big picture, and establishes company goals. However, every small business owner needs someone to help them with the practical aspects of their plan. The visionary sees the forest; assistants and team members concentrate on the trees. They help the visionary with the details to ensure the plan comes to fruition.
The savvy entrepreneur knows when and what to delegate. They know the value of their time and where their focus will be most valuable. Set your sights on your strengths and seek help from people who can assist with the parts of the business that you struggle with.
Hiring the right employees
Creating a winning team takes a combination of team members who can effectively work together. However, you might not have the finances to attract the quality personnel you want.
Find employees with potential. If you invest time and resources into educating your staff, you can mold and grow the exact team you’re looking for.
Consider the offer you can provide to potential talented employees. Stock options, increased pay over time, a flexible schedule, and use of work resources are all great incentives for snagging talented new employees.
When building your team, pay attention to chemistry. Communication skills, turnover rates, team projects, and reliability for deadlines can suffer greatly when you hire people that don’t work well together.
Your team should be comprised of a balance of personality types, such as:
– Introverts and extroverts
– Followers and leaders
– Logical and emotional
– Creative and structured
– Similar and different types of individuals that work together to make a strong team
Overall, focus on hiring the right people—the people with potential. You might not know exactly what role they’ll play in your company, but you know they’ll be an asset.
Struggling with effective time management
Small business owners try to navigate unfamiliar territory while looking for ways to accelerate the business and save money. They often try to balance their family life with their new company. When faced with limited hours in the day, they struggle with time management.
Several tools can help with the daunting task of time management:
– Automated email systems, such as a CRM system
– Online invoicing
– Online scheduling for staff and customers
– Online payroll
Look for other ways to streamline your business to make it run smoothly. Outsourcing data entry is easily done with websites like Upwork. Marketing has been simplified with programs like Podium, and you can take advantage of social media sites to market your business for free and monitor success.
Learning from the struggles of others
Numerous successful entrepreneurs also faced extensive struggles.
Walt Disney was told he lacked imagination. Steven Spielberg had to fake his way to a job at the movie studio. Henry Ford lost it all five times before starting Ford Motor Company.
Read books about successful people who have overcome overwhelming odds and learn from their experiences.
Some inspiring reads to start with:
– "Unbroken" by Laura Hillenbrand
– "Shoe Dog" by Phil Knight
– "Awaken the Giant Within" by Tony Robbins
– "Rich Dad Poor Dad" by Robert Kiyosaki
These are stories of struggle, motivation, and success that any entrepreneur can learn from. Additionally, consider finding personal mentors who have faced daunting odds and overcome them.
Developing a tough skin
As a business owner, you have likely proved your persistence and ability to tough out life’s challenges in difficult situations. Look for creative ways to work around issues. Sometimes, the problems themselves are the doorway to your greatest successes.
Starting your own business is a challenge. Every hurdle presents a learning opportunity.
Be positive, be passionate, and push through the pain points, and you too can reap the benefits of being a self-starter.
Hello!
I’m Andrew Brooks, a seasoned finance consultant from the USA and the mind behind phonenumber247.com.
My career is built on a foundation of helping individuals and businesses thrive financially in an ever-changing economic landscape. At phonenumber247.com, my aim is to demystify the complex world of finance, providing clear, actionable advice that can help you navigate your financial journey with confidence. Whether it’s personal finance management, investment strategies, or understanding the nuances of market dynamics, I’m here to share insights and tools that can propel you towards your financial goals.
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