Getting a startup off the ground is difficult in its own right. Building momentum and thriving long-term is even more arduous and requires an entrepreneur to think on his feet and adapt on the fly. Here are five hurdles all small businesses face and some potential solutions.
1. Obtaining Capital
As the old saying goes, “It takes money to make money.” The bottom line is that no matter how lean a business’s operations may be, it still requires funding to have any chance of success and longevity. The problem is that not everyone has direct access to an unlimited line of credit, and traditional business loans have become harder to get. Or if additional capital is necessary in unforeseen circumstances, it can create a major glitch, and small business owners may quickly find themselves in over their heads.
While there’s by no means a one-size-fits-all solution for procuring capital, it’s important for small business owners to think outside the box and explore several options. Here are some potential resources:
- Angel investors
- Friends and family
2. Business Compliance
Regardless of the industry, today’s businesses are drowning in a sea of seemingly endless laws and regulations. To make matters worse, these rules are continually changing and notoriously difficult to stay on top of. Whether it be misclassifying workers as independent contractors when they’re actually an employee or making payroll mistakes, employers can quickly find themselves in hot water, incurring costly penalties. Fortunately, there’s a viable solution. Partnering with a human resources outsourcing (HRO) agency lifts the burden from small businesses.
3. Employee Recruiting and Retention
Finding and hiring A+ talent is hard. Keeping top employees for the long haul is even trickier and is definitely a major obstacle for small businesses. High turnover is problematic because it hurts profitability and can put additional stress on employers when they’re constantly having to fill vacant positions. Some ways to improve recruiting and retention include:
- Offering competitive benefits
- Developing an effective onboarding program
- Offering flexible working conditions (e.g. telecommuting options)
- Striving to create a strong culture
4. Standing Out From Competitors
Many companies are faced with immense competition and are finding it increasingly difficult to rise above the noise. When this is the case, grabbing a sizable market share may seem next to impossible. What can small businesses do when they’re dealing with a hyper-saturated industry?
- Develop a unique brand identity
- Focus on a micro-niche if possible
- Consider lowering the price point of a product/service
- Be a better marketer than competitors
5. Growth Management
Don’t get me wrong, growth is great. But things can quickly become problematic if growth happens at a faster rate than businesses can keep up with. If they’re unable to manage this growth and scale accordingly, it can lead to several negative repercussions such as diminished product/service quality, the inability to fill orders, unhappy customers and diluted brand equity.
It’s important to build a business piece by piece and grow gradually. Always be sure that adequate capital is secured before making any big promises. Also, be diligent about upholding rigorous quality standards throughout each phase of company growth.
There are no doubt multiple hurdles all small businesses face along the way. Fortunately, every challenge has a solution, and the right approach should allow business owners to move forward.