8 Challenges First-Time Business Owners Face
Being able to set your own hours, do what you’re passionate about, and use your skills to make a life for yourself has pushed millions of people into starting their own business. But while starting a business can be thrilling, it also comes with roadblocks.
There are a few stumbling blocks most business owners are likely to run into when starting their business. Below are eight of the most common challenges first-time business owners face and some ideas on how to manage them.
For many new business owners, starting their business fulfills a life-long dream. You’ll get to work for yourself doing something you love. It may be tough sometimes, but you’ll be free to do what you want! Right up until you run into government regulations.
The government maintains regulations on almost every aspect of business ownership. From environmental requirements to permissible advertising methods, there are hundreds of rules to follow. The thrill of owning your own business can quickly disappear under the layers of red tape.
Don’t navigate this bureaucratic maze by yourself; it’s too easy to get lost. Many communities have a small business association nearby. You should reach out to them for help. If no such organization exists near you, talk to a trusted local business owner about how they manage regulations.
With tax season just behind us, you probably don’t even want to think about taxes. Filing personal income tax is challenging enough. Most people have help to get everything done correctly.
Filing business taxes is even more of a challenge. You can find yourself in over their head unless you have a background in accounting.
If you don’t, hiring an accountant can help you manage your taxes. It’s their job to dot your i’s and cross your t’s. They’ll take care of everything, freeing you up to focus on the important thing – your business.
Remember all those taxes and guidelines? They all require you to keep large amounts of paperwork on hand. And those are only the external processes; any internal processes are likely to include paperwork as well.
If you’re working with external vendors, you’ll need to keep documentation on all your transactions. You’ll also want to keep a record of your sales so you can track trends and your financial status. And if you’re working with clients on projects, you’ll want to keep the information they need readily available.
Trying to manage all the paperwork required to run a business, as well as focus on your customers, can overwhelm a new business owner. Sit down at the beginning of your business venture and set up an organized, self-maintaining system to keep your business running smoothly behind the scenes. You may also want to hire a business manager to handle the paperwork.
It may not come as a surprise, but many new business owners have a hard time meeting the bottom line. In fact, half of all businesses don’t make it past their fifth year. It’s a dog-eat-dog economy. Trying to stand out in the information age can seem daunting.
Before starting your business, you’ll want to make sure you have a budget and a plan for where the money will go. If your business has a slow month, you’ll want to ensure you’ve budgeted accordingly to keep the lights on.
While a lot of power comes with the role of a business owner, we would all do well to remember Uncle Ben’s wisdom in Spiderman: “With great power comes great responsibility.”
When the buck stops with you, you shoulder all responsibility for making decisions. It can be incredibly stressful and isolating. You don’t really have coworkers anymore, just employees.
And speaking of employees, you’ll also need to manage them on a day-to-day basis. Hiring and firing people is its own special kind of stress. If you don’t have any employees, you’ll be the person solely responsible for making sure everything gets done.
When you go into business, be prepared for an adjustment period while you take on your new role. If you don’t have previous management experience, you may want to consider taking a course on management. You might also talk to a fellow business owner about how they handle ownership responsibilities.
As time goes on, you’ll want to garner more business, make more money, and offer greater products or services. But there comes a time when the balance between quality and growth gets out of control.
As your business grows, make sure it doesn’t get out of hand. Don’t sacrifice quality of service for higher customer numbers. Managing this growth effectively may mean hiring more employees and managerial staff or expanding to a new location. Consider carefully how to continue to meet customers’ needs while also encouraging growth.
Getting The Word Out
Of course, one of the biggest keys to expansion is marketing. Advertising is a huge part of business ownership, and in the digital age, it’s both easier and harder than ever before. Social media has entirely revolutionized the face of marketing.
In 2017, businesses spent more than 13 billion dollars on social media marketing. By 2019, that number is expected to exceed 17 billion dollars. Digital advertising may be more accessible than traditional advertising, but it also means trying to get your message to stand out in the crowd won’t be easy.
When you set up an advertising plan, consider which digital marketing platforms work best for you. Social media, blogging, and search engine ads are just a few options available. You may want to hire a marketing expert to help you develop an advertising strategy.
Finally, one of the biggest hurdles new business owners face is staying passionate. Right now, you may find it hard to believe. After all, you love this industry, right?
While many new business owners start out excited, the busyness of running a business can kill their enthusiasm. All the red tape and challenges we discussed can wear down even the most passionate business owner. Burnout is common, and it can be harder to do the work when you’re drained.
If you feel worn out, take a step back. Take a day off if you can, and talk to another business owner about your challenges. Remember you’re making your living doing what you love. It never hurts to remind yourself of the wonderful things about your industry.
Being a business owner isn’t always easy, and you’ll face more challenges than just these eight. But if you build a strong resource network and you’ll be able to pull through them.
If you’re looking for some of those resources, visit our blog. We have advice on a number topics for new business owners and tips to help overcome them.