5 Struggles Small Businesses Face

When I was a kid, I saw business owners as the most successful people on the planet. Movie stars were cool, but business owners and CEOs were the ones I’d rather have an autograph from.

Growing up I still find them more impressive than actors or singers, but I realized that its not all green grass and sunshine. Sometimes its more akin to shoveling manure in the rain to make that grass grow.

If you see a successful business, the owners or managers have almost certainly faced intense challenges and struggles to get there. All businesses face difficulties, but some of these challenges are unique for small businesses.

Here are the five of the most considerable challenges faced by small businesses

1. Client Balance

When a small business lands a client or customer its cause for celebration, especially when it’s one that will bring in substantial revenue. The trouble is when that client becomes your lifeline.

As the adage goes, don’t put all your eggs in one basket. It can get you into a tight spot if you depend too heavily on the single client. If they get upset and leave you may find yourself in a world of trouble.

Its okay to have a large client, in fact its great. Just don’t let that single client be what your business rests on.

2. Poor Financial Management/Accounting

Cash flow is an obvious concern for any business, but for a small business poor cash flow or money management can be especially impactful. In business, cash flow and income are not synonymous. You likely have clients who pay on net terms and bills that you pay on terms as well. Dealing with Accounts Receivable and Payable can be confusing.

Spending money because you have cash in the bank without understanding your Payables and Receivables can be the death of your company.

3. Burnout

Owning a small business, or even managing one can be immensely rewarding and even more exhausting. The 8-hour workday is nonexistent in that role. Your business needs you 24/7 in many cases and any slacking off has large consequences.

In a small business, members usually fill multiple roles, and each role can be its own full-time job. If you’re running the operations you need to oversee the day to day, plan your next move, source materials, drum up business, and manage the finances too if you don’t have an accountant.

This can all be extremely taxing both mentally and physically to the point you may want to give up. Its important to be mindful this and take time to rest — Build rest into your plans.

4. Refuse Help

Trusting someone else with your business is terrifying. Nobody knows it like you do and nobody cares as much about it. But like we mentioned above, you will get burned out eventually. You will have to find employees that you trust to hand over some responsibilities to.

Unless you are the most impressive, capable person the world has ever seen, you can never be as successful running everything alone as you can with a skilled team.

If you’re not an expert in marketing, find someone who is. Having trouble with logistics? Find someone who knows how to streamline. Don’t understand how your bank is overdrawn but your books show you made money? Find an accountant.

Putting the right people in the right places is paramount to your success. Having a capable team to contribute in areas where you lack will make your business stronger and much more likely to thrive.

5. Growing too fast

Sometimes you get your first client or customer, and they are thrilled. Your customer service is phenomenal, your products are great, and your prices are just right, so they tell everyone they know. Your advertising is spot on and you have a great location so business is flooding in!

Its rare, but that happens sometimes. When it does you may find yourself overwhelmed and rather than turn customers away you accept everyone that comes your way.

Now orders start getting behind, but your customer service is still strong.

Then your phone is ringing nonstop while you’re dealing with a customer in your store. Its distracting, you’re stressed and you’re getting a little hurried in your speech.

Suddenly customers aren’t perceiving you as the ever helpful, friendly store owner anymore.

Finally, the conversations about your business are now “they used to be great, but now xyz”

That may seem like a silly thought exercise, and it probably won’t be so cut and dry in most cases, but the point is that you need to approach growth intelligently. Plan it out and utilize resources carefully. Don’t sacrifice quality for quantity, strive for both consistently.

The Takeaway

Businesses face problem every day, but for the most part there are two keys to success. People, and Planning.

Think of business like a sport. You have the coach, coaching staff, and the team. If the coach tries to play the game themselves with no team and no consideration to what plays they will run how successful do you think they will be?

If the coach has a great game plan and great players, but places them in positions that are a mismatch for their skills (kicker in wide receiver position, QB on defense for example). Then they are already fighting an uphill battle.

The team will be most successful if the coach, staff and team are working together with a good plan — one that is shared openly, and with the skills of the players matching their position. That is in essence how business operations work.