Starting a business can be a daunting task. There are so many things to think about and, unfortunately, so many things that can go wrong – it’s a risky decision. No longer are you being told what to do, and how to do it – all of the decision making and responsibility lies with you. Start-up businesses come with their own challenges, and we thought we’d prep a list for you so you can get an idea of what you may face if you are thinking about starting a business.
There will be Competition
There will be competition no matter what kind of business you open, and prior to starting your business, it’s not something that you would ever need to worry about. The first thing to do is do your research on what they are offering, and what their USP (unique selling point) is. Knowing everything you can about your competitor is the best way to compete with them. Getting contracts in the public sector, in particular, is an incredibly crowded market – particularly if you are looking to bid on tenders for work. They are notoriously hard to get and very competitive – but also very high value if you manage to secure a contract. Thankfully, initiatives such as WA Industry Link in countries such as Australia will be able to offer any advice and support needed if you are looking to get that kind of work. They have numerous useful guides on their website and also provide advisory services should you feel like you need to speak to an expert.
This can be the biggest challenge for small businesses – making sure there is enough cash in the bank. It was reported in 2017 that only roughly half of small businesses in Australia had a positive cash flow to speak of. They also stated that the biggest reason for this was that they were trading at a loss. To avoid any long-term issues and to improve cash flow problems – there are some strategic business decisions and improved processes that may need to be made such as staff levels, how long you are taking to pay invoices, and how soon you are taking to get paid. You should also be regularly monitoring your profit margins. Turnover is vanity, profit is sanity after all.
Growing a Business
Once you have set-up your business, growing it can become difficult -especially if you are on a tight budget. There are lots of cost-effective ways you can do this such as networking events where you can grow your contact sphere – but in order to grow, it is important to keep up with some of the website and digital marketing trends of 2018. You need to stand out from the crowd, and digital marketing is essential for you to be able to do this. This includes how your businesses are branded, what type of website you have, what your search engine presence is and more – all of which takes a while to get to grips with. You can outsource this to an agency if there is a specific budget you have in place for marketing, or else there are lots of Government funded courses you can go on that will help you out.
The Speed of your Internet
Although this may seem a small issue at first, internet speed is crucial to business success and can be a challenge. Some broadband services are a bit of a concern for small businesses – which can particularly problematic if you are an e-commerce brand. You need to make regular updates to product descriptions, content, ensure your payment gateways are working properly and of course you need the simple function of being able to be online in general. When the internet is at its slowest at its most busy times, this can be a challenge for any business if you rely on being able to share information via email or any other online platform.
Facebook has been crucial to the success of many businesses, however as they have continued to develop over the years, it is becoming more and more difficult to reach your target organically, which was a previously free marketing tool for small businesses. Now to get a prominent presence on your prospective clients’ news feed – you need to spend money on targeted ad campaigns. There are creative ways that you can try to avoid this and use Facebook’s algorithm to get as many as your posts as possible – but the reality is that it will be a challenge in 2018 for those who don’t want to spend any money on this platform.
These are the main challenges we see for small to medium size businesses occurring in 2018. It’s important that you recognize these and have contingency plans in mind for anything that could affect you.
- Managing for Bottom Line Cash Flow in Retail
- Cash Flow: A Factor to Determine Your Financial Wealth
- How to Increase Cash Flow of Your Small Business
- 10 Ways to Manage Your Cash Flow
- 10 Cash Flow Rules You Can’t Afford to Ignore