If you’ve just started a new business or have only been operating for a few years then the chances are you have overcome a lot of risk factors and a lot of challenges to get to where you are. It’s all too well known that most new businesses fold within one year but many are successful.
Small businesses account for $5.9 trillion in the economy.
But not many people recognize the challenges that small businesses face when they attempt to grow.
Here are some small business tips and how to overcome the hardest business challenges.
1. Hiring New Talent on a Budget
If you have ever worked in an HR department or you have been a recruiter then you know that hunting out the best talent to work for you is a full-time job. It’s not just a case of finding the person with the right qualifications who matches the bill it’s also about personality.
You want to invest time finding the right person who can grow your company but also someone who is going to gel with the rest of your team. You need the right team otherwise you can end up with serious internal political issues that can distract from the business and lose your money.
But more than anything in the earliest stages of the business, you need someone you can trust and someone who could potentially do a variety of jobs outside of their job description in order to get the business to where it needs to be.
Trying to find these people can be hard when you don’t have the budget for an HR team and are having to invest time hunting for people on top of managing the business.
As a new business, you also might not have the budget to pay for top talent that you need so you run the risk of hiring people who are mediocre or hiring top talent who then move on very quickly.
2. Dealing with Regulation
Large corporations can hire a team of lobbyists to ensure that the government listens to them and that the law is – to some extent – created with their interests in mind.
Some of the top accountants can also exploit legal loopholes and streamline the business to make sure it is always making as much profit as possible.
Without a team of experts behind you, you start to feel isolated and overwhelmed by the endless paperwork and regulations that the government can impose on you.
One example is if there is a fatal accident at your workplace and you are based in Texas. You may find yourself needing a Houston wrongful death attorney to defend your interests and prove that you had followed all the regulations properly in court. This can be expensive.
One of the best small business tips is to think of creative ways to deal with this and to make sure you invest in the right experts to navigate these tricky waters and cut back in other areas.
3. Going Global
The key to success as a business today often depends on whether you have the capacity to reach customers all around the world. Whilst the internet provides that possibility, the difficulty with the internet is that you start to grow too fast and cannot keep up with demand.
You can also very easily fail to do market research in the country you are planning on targeting and you could also fail to grasp the culture. As a result, you could end up losing money. You also need to understand the local laws and make sure you don’t fall short and end up in legal trouble.
Bigger businesses have the time and the money to invest more in this, potentially even flying their team out to the new country and setting up a local base there. As a smaller business, you are going to have to more limited resources.
Also remember that with the world ever more connected than before, even something like Brexit needs to be taken into account even if you are based in the U.S.
4. Raising Capital
Perhaps the hardest part of starting a business is ensuring you have the capital behind you both to realize your ideas, however, profitable they might be but also to ensure that your business is sound in the case of an emergency.
The more capital you have access to as well then the easier it will be to take out a loan from a bank to finance bigger projects. One example is if you wish to enter into the property business.
As a small company whilst you might make a handsome profit from your first sale, the profit might not be enough for you to move up the ladder and buy a bigger property that has a potentially bigger return.
Small Business Challenges: Be Cautious
Although small business challenges often seem greater than those in a bigger business scenario, the same advice applies to both. You need to be cautious but at the same time take calculated risks.
As a smaller business, you need to be aware of your limitations. This includes in terms of the capital you have behind you if something was to go wrong but also in terms of regulations and making sure that you are covered should an accident take place or a new government regulation places a new burden on your business.
Taking your business global using the internet is very exciting and is to be encouraged but as a smaller business it can often be harder to make inroads and you may not have the budget to be able to go out and see the country or set up an office there as some of your larger competitors might be able to do. Without this, you could struggle.
Finally, hiring new talent for a startup company launch can also be tricky, something that a company in its infancy needs more than a bigger company.
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