5 Business Challenges Every Startup Owner Faces & How To Tackle Them

Nothing goes down as it should without tackling challenges along the rugged way of the business world. With or without the internet, entrepreneurs in every decade have faced extreme challenges right from day one. Although threats and obstacles have changed with the passing of years, some basic challenges remain prevalent to date. Perhaps the only difference that exists amongst entrepreneurs between us and the ones in the 80s is the successful capability to tackle threats of the 90% of business owners; all thanks to the handy encyclopedias within our access.
 

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5 Major Challenges and Their Solutions

Below you will find 5 such challenges that top the list, describing problems and their respective proven solutions that entrepreneurs deal with today.

1. Management of Finances

The very first challenge that an entrepreneur encounters at the very start of his small business is the management of cash flow. You are not being paid a fixed salary for the work that you do; therefore, it naturally gets quite rough to pay off every single expense without having received payment yourself.

Small businesses cannot survive in the ultra-competitive business world with this problem tagging along because if your workers, your bills and your contractors are not paid on time, they will easily replace your vulnerable position with a stronger dealer. The worst threat linked to every challenge we are going to look at is being replaced. Newbie business owners do not have that sort of status to remain firmly in place, and hence anybody else can easily fill in the space you worked so hard to achieve. Utilizing tools like Simplifi by Quicken can help streamline cash flow management and mitigate these risks.

Solution: Act Tactfully

Poor management of cash flow stems from delayed invoice, and the wait for arrival of checks. In the meantime, you need to back up solutions to keep people under you, happy. The first tried and tested solution to improving cash flow is requiring a down-payment for your services as your business’s policy. Adjust your down payment so that it covers most associated expenses of the particular service you provided to the client—plus points if you are left with some profit in your hand.

As a second solution, you can reduce the days of invoicing from 30 days to perhaps 15 or lesser. In this way, you can wriggle the timing of your bills due without facing much hassle. Even if your customers delay in payments, you would still have ample of time to remind them or extract your cash.

2. The Recruitment Process

As of number second, we rank the prospect of recruiting the best employees as the next most challenging tasks. In fact, a survey suggests that there is a close competition between the levels of fear within the employers and the candidates; once or twice, the entrepreneurs hiring workers for their business won the mark at being most scared at interviews. Also, some startups also choose recruitment through an automated applicant tracking system. Strange, isn’t it? If you consider the whole situation from their point of view, you’d not feel so strange about this.

Entrepreneurs invest all of their money, time and efforts into their business, particularly the starting ones. Like any firm, they know they need to filter out the golden candidates from a long list of participants. While that is not exhausting enough as it is, it also stresses them to keep the diamonds they have discovered by offering attractive enough packages, as far as their budget allows. Most of the time, startup business owners cannot keep their desired employees because of this problem.

Solution: Specificity is Essential

There is a sequence of solutions to this challenge, and it goes like this: when posting an ad, be extra specific to your requirements. The filtering process must begin from ad-posting as it is so that only the candidates possessing the requirements come forward for the interviewing. Next, perhaps change your tactics and take your top 10 candidates through a “walk-on” interview. Tour them around the building and shoot questions along the way.

This way, you would have a larger space and relevance to interrogate the candidate. Ask them about their experience, long-term goals, and what value they can add to your firm. If a particular person clicks with you, make sure you question about his/her expectation of a salary package. Through this, you would have an idea of what to offer in order to keep them hooked. In the end, take your time to decide. Avoid references and seek the real applicants applying solely based on their merit.

3. Time Management

Although this challenge is a dilemma for every working person nowadays, be it a sole proprietor or a serial entrepreneur, yet for startup business owners, management of time matters perhaps far more than anybody else. For them, time is just like money—valuable and being spent with every passing day. Many entrepreneurs cripple under poor time management and so does their business at some point later. In order to combat this toxic threat, read about the solution.

Solution: Give an Order to Your Plans

Entrepreneurs need to make time, and for that, you first have to take out a day and pen down your goals. Goals of your life. Then break them down into years, into months, and finally into weeks. Once they are narrowed down to weekly goals, assign tasks to each day. Once you begin your work, stick to the timetable you created and make sure your tasks are being done day to day with no excuse.

However, to stay on track, eliminate the tasks that don’t benefit your goal. If there is a duty that you cannot complete yourself, delegate a worker for it. Whatever you do, stay on track and constantly look out that your time is being spent productively.

4. The Capital

Above all, these challenges are the one we almost skipped to discuss—the capital. However, despite it being the primary threat to any business, there are ample resources from where entrepreneurs can solve this problem. Let us look a bit into its easiest solution for those who remain unaware.

Solution: Proceed Gradually

You can take up loans from banks or family or friends to start your business, yet the route to self-growth capital is by far the safest route there is. Start small, focus on collecting customers, and thrive on customer-care alone. If your customers are happy, you would ultimately gain more than the word will spread.

When your clientele number multiplies, however slow, start delegating tasks and spreading the process a bit. Do not compromise on quality because that is one thing which must remain constant throughout your era. Your customers rely on the quality service you provide, and so must you.

The growth of any business must be slow and steady—haste often messes up things. Do not be frustrated by your gradual progress. If, however, you feel you need more money than what you invest right now, try consulting an attorney. They would give a better idea about the amount you should take up and the risks associated.

Explore: Misunderstood Business Terms Entrepreneurs Must Know

5. Personal Attitude

The last challenge I would like to explore is self-doubt—something we all go through, but for entrepreneurs, this challenge can be lethal if allowed to influence. Entrepreneurs are quite vulnerable; they do not know if the business they are risking on so much is even going to return half their efforts or not. If anything goes wrong, newbie entrepreneurs teeter along the way and self-doubt in the worst form creeps in.

Life is the name of a series of trials; everything will not go right all the time. In order to be a successful entrepreneur, you need to know how to motivate yourself when fears of self-doubt steps in.

Solution: Support is the Key

First, a solid support system is essential for an entrepreneur; family, friends or advisory board, whatever you choose. They must know your ambitions and should support your plight, be there with you at the start and should stand through thick and thin.

Apart from keeping friends and family close, learn to become self-motivated because your surroundings are hardly going to push you to work. If anything goes wrong, remember that failure is the first step towards success; if you will not commit a mistake, how would you learn? When you feel exceptionally down, look at the goals’ list we talked earlier about.

Remind yourself that each passing day is bringing you a step closer to your lifetime goal, and it’s not at all in vain. To go further, Google some quotes from entrepreneurs and you’d be motivated in no time. Their life stories are enough to jostle entrepreneurs to reality, and their few words will reignite your lost drive. Did you know, the CEO of Intel says about entrepreneurship that, “only the paranoid survive,” so if you are paranoid along the route, congratulate yourself!

Good luck starting your startup business!