Starting a business is a huge accomplishment for most entrepreneurs. Not only that but in most cases, it’s the fulfillment of a lifetime dream.
Starting a business does, however, involve a lot of challenges.
Before anyone starts their own business, it’s always a good idea to enlist the help of business consultants, which can be worth their weight in gold, pointing to opportunities for growth and preventing troubles before they start. Here are five of the critical challenges to overcome when starting a business.
Depending on a Single Client
Everyone has to start somewhere but to keep a business going, it must rely on more than a single client. Instead, a business owner must try to have as many clients as they can reasonably serve. Otherwise, if that client’s business were to fail, a dependent business will fail also.
Manage Cash Effectively
Whether it’s an individual or a business, there must always be enough cash to cover expenses. Further, one cannot depend on continual infusions of cash from the other. According to a report issued by the National Federation of Independent Business, having insufficient cash reserves is a primary reason for business failure. Making matters worse, business owners tend to overestimate their business incomes and underestimate their bills. If a business owner anticipates a lack of cash, they should borrow.
Fatigue and Burnout
Most business owners start with vast amounts of passion and drive for their business to succeed. Unfortunately, the work, long hours, and constant pressure to perform soon take its toll. Business owners often find themselves working considerably more hours than their employees. Moreover, they feel that their business will falter when they are away, so they rarely take time off. All of this adds up to fatigue and burnout.
If the founder of a business were to be hurt in an automobile accident, what are the chances that the company would meet its deadlines tomorrow? If a business owner were to die today, what would the business do without them? What are the chances that the business would continue? The founder of a business may be so involved in making decisions for the company that it would not continue without them.
Balancing Quality and Growth
After many businesses reach the point where they become successful, another problem begins to surface: the never-ending struggle between quality and growth. Said another way, does a company continue to carefully manage its relationship with customers, such as or scale-up growth? Every owner and manager should monitor how their clients and customers are treated, but should this attention be sacrificed in favor of growing the business? Should the responsibility of a manager or owner be offloaded so that they can pay more attention to growth and less to lower-ranking tasks? Finding that balance can mean the difference between success and failure.
The challenges that face a business, especially a new one, can be considerable. This can be made worse by owners and managers who don’t pay attention to those challenges as they emerge. The points made above will help those responsible for a business to deal with them more effectively, but there is no way to avoid them. Fortunately, the same competitive drive that leads many people to start their own business leads most of them to overcome these challenges.