Starting out as an entrepreneur is such a thrilling experience until the standard challenges which face entrepreneurs begin to rear its ugly head. The truth remains that a growing business has to face these challenges which have been outgrown by larger corporations.
Some of the challenges of managing a small business are:
1. Dependence on Clients
The truth remains that every small business has to start somewhere and more often than not with a few clients. During this vulnerable period of managing a small business, it is likely that a single customer or two might make up more than half of the revenue generated.
You will notice that your business ideals may be tilted towards that of your major client who pays well and on time. To overcome this challenge and not risk going south the moment you lose such a client, it is advisable to diversify your clients.
Except such client has a consistent need for the product or service you offer, your small business is definitely standing on solid ground.
2. Dependence on Founder
This challenge is typical for small businesses as well. They totally depend on their founders for every single thing from decision making to the provision of funds. Put simply, the existence of such a business is limited to how long the founder remains alive or fit enough to pull the business along.
The founders may have to compromise on the quality of work done when they want to delegate certain functions as the business grows since the person it is being delegated to has not fully learned the ropes.
3. Management of Money
There never seems to be enough money for small businesses to cover bills such as paying salaries, investing in technology, and so on. To scale this challenge, it is typical to see the founders of small businesses working at other jobs in order to cater for needs of their respective businesses.
This can cause a split in focus for the small business owner except if they decide to be heavily capitalized. The need to raise funds for running a small business is a major challenge since growing a business without cash is near impossible.
Even the most enthusiastic entrepreneur experiences fatigue at a point in time. This is because of the long hours they put in at work and the worry that the business will fail if they are not present to run it. The challenge of balancing the smooth running of a small business without running one’s self ragged is a big challenge for small business owners.