5 Biggest Challenges for Small Business Entrepreneurs
Though successful small businesses are incredibly vital to our country’s economy, it can be an awfully daunting challenge to build one from the ground up. The road to success is fraught with even more challenges and some of those change from year to year because of advancing technology, a shifting economic climate, and the uncertain human factor of both your customers and employees.
Some challenges are bigger and more universal for entrepreneurs than others. Here are five to keep in mind and address before they can hurt your business and its growth.
1. An uncertain political climate
2016 is an election year and many already know it is fraught with controversy. A lot of strong personalities are promising a lot of things, some of them with the potential to have massive ramifications for the economy and American businesses. An impeding election can make planning for beyond November 2016 seem rather dicey.
There’s been a lot of change in the last eight years that has affected small business, from tax incentives to new regulations (one of which—the new white collar overtime exemption threshold—likely to take effect later this year). It takes a hefty amount of research and reading to keep up with what you need to be aware of as a small business owner, and some of it might change next year.
The more aware you and your managers are of these economic intricacies, the less likely you’ll be given an unpleasant surprise in the form of fines or other non-compliance penalties. Try to set up regular meetings between you and your small business upper management team to share new findings and insights or to plan ahead.
2. Additional costs resulting from the Affordable Care Act
To see how much the political climate can affect small businesses, look no further than the complex set of regulations involving the Affordable Care Act.
Fortunately, many of the provisions, fees, and reporting is required of larger companies—for those with 50 or fewer full-time employees there’s not quite as much to keep track of for now, but there are still plenty of compliance issues to be aware of. Primarily, those involve providing notices of health care coverage availability and ensuring minimal essential coverage guidelines are being met.
But, the bigger concern is to be aware of changes once your company grows out of the small business category. Either prepare yourself and your company for the graduation to a different level of fees and reporting or evaluate your staffing levels to create a solution to avoid employing more over 50 full-time equivalent workers.
3. Burnout and fatigue
Chances are that, at some point, you’ve tried to do too much as a business owner and felt the strain of it. That’s only natural—when trying to get a small business off the ground, it’s cheaper and seemingly more effective to do the more important things yourself.
But any experienced entrepreneur will tell you, there are never enough hours in a day and caffeinated products in the world to do that and survive. What it comes down to is knowing your company can’t rely on your constant presence in the trenches to operate. It comes down to delegation. Surrounding yourself with people who can keep the machine running is imperative, because you’re eventually going to need to settle into a manageable routine and workload for your own sanity and health.
4. Finding the right employees
The growth and future of a business of any size depends on its employees, particularly those in the chain of succession for upper management and the C-suite. That being said, hiring may never be as important as when your small business is bringing on its first substantial class of hires.
Prioritize those who can handle multiple aspects of your small business—chances are, your company is going to be slightly understaffed in the early days to save some money. Having folks with the ability to occupy multiple roles effectively can prevent you from feeling the strain of a small workforce.
After your initial hiring rush is over, focus on filling in the gaps with cost-effective but committed talent, whether they are full-time hires, part-timers, or vendors. Bring on the workers your bottom line permits, but maintain contact with good candidates who may not fit at the time. Always be looking ahead by offering benefits and advancement opportunities for helping your small business grow. But, most of all, be choosy and be honest with your hires about what you expect from them—your growth depends on you getting the most out of the talent you bring on board. (Check out our tips for small business employee retention.)
5. How to break through online
Although social media seemed to initially level the playing field for smaller companies, the ubiquitous use of it in marketing nowadays can make it feel as overwhelming as advertising seemed in the pre-Internet days.
A small business can benefit by seeking their fit among the non-Facebook and Twitter platforms. Does your product and company fit particularly well on LinkedIn, Pinterest, or Instagram? Then tie that to your Facebook marketing and amplify your efforts on both platforms.
Beyond that, it’s important to rely on inbound marketing—invest in improving your website, producing great content that makes you stand out in a crowd (whether it's entertaining, educational, or a little of both), and utilize email marketing to an appropriate degree. Many of these options don’t cost much in terms of time or money and getting into the habit of consistently using them can accelerate your company’s growth in a way few other methods can.
Need more help running your small business? Paycor has you covered. Contact Paycor to learn how we can help streamline administrative tasks and allow you to spend more time building your business, or check out some of our other articles for entrepreneurs.
Sources: National Association of Manufacturers, Dayton Daily News, Investopedia, Council of Smaller Enterprises
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