3 Small Business Challenges for New Entrepreneurs

Making the decision to leave the rat race and launch your own small business can be both exhilarating and terrifying.

No more having to answer to your boss, but at the same time, no more having the security of a consistent wage.

 As an entrepreneur, you most likely already have the drive, motivation, and self-belief to make your business a success, but that doesn’t mean that you are immune to the common challenges that all small business owners face.

From finding and retaining loyal and high performing employees, to establishing your brand within the marketplace, to inconsistent cashflow, keep reading to discover the top three small business challenges that you face as a new business owner, plus, tips on how you can overcome them.

1.   Finding top talent

Recruitment and staff retention are arguably two of the most common and troublesome challenges that small business owners face. As an SME, the performance of your employees is crucial as they are the face of your business. The ones your customers turn to for help and advice, as well as the ones who are promoting your brand daily.

Did you know that 76% of workers in the U.S aged 18-34 are willing to relocate for the right job?

With this demographic being a crucial part of the modern workforce, it is a good idea to widen your search parameters when you need to hire new employees and consider those who live outside of your local area.

You also need to ensure that you offer an attractive relocation package if you want to attract the top talent, ensuring that they benefit from the move in the same way that you will.

Use this simple online cost of living calculator to make sure that the salary you offer will cover the new living expenses of potential candidates and surpass their previous wages.

2.   Cash flow issues

When you first start out as a new business, it is highly likely that you used all your savings and resources to launch your company and have very little left to use for emergencies.

For this reason, cash flow problems are incredibly common with new SME’s, with some of the main contributors being late customer payments and overestimating future sales volumes.

Although you cannot completely eliminate these issues, you can find ways to minimize their effect on your business.

Look to a mentor within your industry when you are revenue forecasting as they will be able to offer knowledge and experience as well as historical sales figures from their business.

It is also a good idea to be selective about who you work with, although this can be harder said than done when you are a new business, as a company with a bad credit history is much more likely to miss a payment.

3.   Increasing brand awareness

Even if you have developed the most innovative and unique product in the world, you will not make sales if nobody knows about your business. That is why brand awareness is so crucial and why businesses reinvest such a large proportion of their profits into their marketing efforts.

Fortunately, there are ways in which you can successfully market your new product or service without having a massive marketing budget.

Digital marketing is more popular and effective now than ever before, with social media being a valuable and cost-effective way to promote your brand and increase customer engagement.