Challenges Facing Small Businesses Today
The government and the private sector have in the last few years tried to obliterate barriers to starting new businesses. Even so, starting a business is still frightening to most people at least when it comes to the difficulties associated with the same. Most people always think that starting a business is all about having an idea.
How many citizens have an idea of how a country should be run? But, how many people out of those having ideas execute the ideas to fruition when elected? People have ideas of how they can turn an industry though all these fade in the face of envisioned challenges. In most cases, 80% of startups and small businesses barely survive the first two years of their business. Below are the challenges that small businesses are facing today.
1. Ineffective web presence
Marketing is of prime importance for every business. This is where big businesses have an edge over small ones. Early on, most businesses didn’t give marketing the importance it deserved. Most CEOs thought that manufacturing the product was the most important for business. Far from the truth they were. It’s of no importance to make products which cannot solve the problems of your customers. But how will your customers come to know of your product’s existence? Today, large businesses have the answer. It’s only by marketing. They have big marketing products that ensure that customers have easy access to the products.
Advertising is very expensive, especially for small businesses. Word of mouth is very slow given that most customers like shopping online. Technological advancements provide an avalanche of opportunities to market online. One such advancement is social media marketing. Remember, as a small business you can buy TikTok likes. But are small businesses using these platforms? Are they oblivious of these or is it due to ignorance? A website is necessary to have an online platform and in most cases, this involves search engine optimization.
Big businesses have a well-organized department to manage all these. What about small businesses? They cannot afford to have marketing teams let alone marketing departments. They end up leaving all these platforms unutilized because no particular person is assigned this role. This hurts the business as no company can grow without making a profit. Profit depends on sales which in turn depends on marketing.
2. Cash flow issues
Most challenges that small businesses face are financial management-related. To effectively manage your business, all outgoing and incoming transactions need to be taken care of. Normally, small businesses cannot manage employee accountants. What happens therefore is that their finances are usually managed by amateurs.
Take this scenario for instance. You are a business owner, moving left and right, to all the departments trying to ensure all the activities are running smoothly and on time. All the while, you believe in your employees; those employed to manage the finances. Only to realize that most of the transactions throughout the month cannot be tracked. What do you do? Where do you start? Many small businesses have been caught in this scenario forcing them to opt out of doing business.
3. Trouble in finding employees
In the US for instance, more than 32 million small businesses are amounting to 47.5% of all jobs in the country. But does this mean that it’s easy to find a proficient employee? These days, though employed, most people are still on a job hunt. They are looking for the best of the best. This challenges small businesses because come to think of it, can a small business compete with the benefits offered by large companies? Can they provide overtime packages, holidays and motivate their employees at the same time? Moreover, large companies can hire those who are specifically qualified for one task.
This is not the case with small businesses as they need those who can handle at 2 least tasks. Yesterday, I walked into a nearby mart to buy some groceries only to find the person who served me at the bakery was the same person serving the groceries. What if she were not able to manage the two tasks? Moreover, though she could be having all it takes to bake, she probably would not produce the best products due to the undivided attention. This is what normally happens in most small businesses.
4. Lack of funds
Business money is what fuel is to vehicles. Compared to big companies who are always in stable conditions of making all purchases and keeping up with all payrolls, small businesses are usually very unstable. They could be at the top today and bankrupt a month later. Think of this scenario. You have a small business which deals in supplying construction materials. Because it is not established already, you only have one big client who covers close to 80% of the sales. What happens if the client fails to make payment? What happens if you have a fallout with the client? This is what small businesses usually deal with.
Do you have a small business? Do you plan to start one? Here are some of the challenges that small businesses deal with on a daily basis. Acquaint yourself with them and have that business leap you so desire.
