In January 2019 partners from the UK, Bulgaria, Portugal, Greece, Romania and the Netherlands kick-started a new Erasmus+ innovation project called ‘Your Business Success’. The project team researched the main challenges facing small businesses – here are the top ten challenges.
Challenge #1: Money
Unless there is a positive cash flow immediately, either from sales or investors, money is going to be an issue sooner rather than later. Poor cash flow can delay important projects and progress like rolling out new products, hiring key staff, or fitting new offices.
Challenge #2: Marketing and Sales
Devoting enough resources (time and money) marketing and sales is a major challenge for businesses especially small and start-up enterprises.
Challenge #3: Your Comfort Zone
Growing an enterprise can often feel like ‘taking one step backwards for every two steps forward’ As a small business, people, especially the owner must wear many different hats and must be expert jugglers. Each new hat usually requires the wearer having to ‘step outside of their comfort zone’.
Challenge #4: Finding the Right People
Certain skills are crucial not only for your business to survive, but also for it to grow. Knowing the exact skills that are required and how to get those essential people on board — might be the determining factor in how well an enterprise survives and performs.
Delays in finding the right personnel are costly. For a small team, the recruitment process eats up valuable time that could be spent on other areas of the business, but on the other hand, not having the right people can create severe bottlenecks and stall the rollout of new products and services. Finding and developing the right people is a priority for all enterprises especially start-ups and smaller businesses.
Challenge #5: Scaling Up
Assuming sales are growing, the next challenge is how to resource and scale up for growth. The answer is not a simple as ‘just adding a few extra employees’. Growth creates pressures on time, resources, skills, processes, space and stress levels.
Challenge #6: Lack of Planning
It is surprising how many start-ups and small enterprises falter because they forget or neglect to plan. Key areas such as sales, marketing, business development, staffing, skills shortage, and funding MUST be part of the business plan right from the beginning.
Challenge #7: Time Management
Every entrepreneur and business owner know there is never enough time. There are a million and one decisions to be made and only 24 hours in a day. This means that eliminating or minimising distractions — anything that gets in the way of running your business is critical. It is imperative that the time and energy is focussed most impactful things requiring expertise prioritisation skills.
Challenge #8: Competitors
No matter how good an enterprise’s products or services are, there will be competitors and the market place are likely to be very crowded. Keeping an eye on the competition and the constantly changing market is a MUST. Having the right strategy, being able to think on your feet, and being able to adapt to the new reality will define an organisation’s success — or failure.
Challenge #9: Lack of Mentorship
An enterprise might have a great product or idea, but lack the necessary guidance, market experience, or knowledge to take it to the next level. This is where a great business mentor can add a huge value to the business therefore finding one is a priority. Having somebody to lean on when major decisions have to be made, or even just when a sounding board is needed especially from someone who has already been there and done that, is very elpful.
Challenge #10: Poor Management
One thing start-ups and small enterprises cannot afford is ineffective management. A management team that worked well in the initial stages may find itself struggling as the business expands, as the owner and management team is tested by anything from poor sales to market conditions. Therefore, it is essential that enterprises have the right people and effective planning processes in place – it is not a coincidence that Challenge #4 + Challenge #6 = Challenge #10!
The new Your Business Success digital business planning tool will help small businesses to plan and manage each of these challenges. By the end of the summer 2019, partners will be looking to work with local small businesses to pilot and test the new Your Business Success tool. If you are interested in taking part, then get in touch with your national partner today!