Starting your own business is one of the most rewarding things you will do for yourself, but it has challenges beyond just the start-up capital and choosing your branding. No matter what type of business you’re starting, there are five common challenges all businesses face. How you meet and overcome them will determine how successful you will be and whether your business stands the test of time and the market.
Depending on One Client
Often, we find ourselves building our new business thanks to a relationship we have with one or two clients. While it’s good to have a strong working relationship, and you want to keep good clients happy, if all your work is for one person, are you really your own business, or someone else’s employee?
Make sure that you have the time you need to diversify your client base. That may mean bringing on new employees for your business. It could mean deciding what work your client should be able to do in-house and letting them know that you can’t do those tasks anymore. Remember, if you’re dependent on only one or two clients, what happens to you if they suddenly don’t have work or decide to find a new agency?
The Finances
Money management is another big challenge for small businesses. From entangling personal and business finances to unexpected surprises at tax time, finances can be crippling to a business, which is ironic since you’re in business to make money. To help you get a good handle on the finances and avoid pitfalls, you should,
Create cash reserves for your business as soon as you’re able to avoid dipping into personal funds for business expenses
Learn what your taxes, licensing fees, and other expenses will be as early as you can and if necessary, hire a professional to assist you with these
Establish a reliable system for paying and tracking your expenses and collecting payments from your clients (this is another area where a professional or specialized employee is a good investment)
Burnout
The extra time and hard work that you have put into your business have rewarded you. Maybe you see yourself as supporting your business by putting in the extra hours, maybe even more hours than your employees work. What you’re really doing, though, is setting the stage for fatigue and burnout. Once you reach that stage, you’re prone to bad decisions, including delivering poorer quality for your clients. To help ensure you avoid burnout, you should,
Set a pace for yourself that ensures work is done without overworking you – this may meet adjusting deadlines you promise clients
Consider bringing on employees to help divide up work so that you’re not working more hours than you need to
Make sure that you have someone who can perform any task you do if you’re not available – simple redundancy means you’re not always on call and have time for yourself and your family
Set up an action plan for problem-solving so that your employees can handle unexpected circumstances – you need off-days and even vacations sometimes
Balancing Quality with Growth
One of the reasons you have your own business is because your clients like the quality of your work. Maintaining that quality is vital to your success but be careful. Quality can become a trap if you become obsessed with perfection. Look at your workflow and what you do for your clients before your business starts to grow. What are you doing that adds to the quality and what is extra work you don’t or shouldn’t have to do? Are there parts of your process that have become redundant with the addition of employees, equipment, or technology? Streamlining your processes whether you’re making a product or providing a service will position you to be ready for growth while minimizing any reduction in quality.
Dependence on You
Just as you don’t want your income to depend on only one client, your business should not depend on just you to run. Consider: what would happen to your business – your clients and your employees – if something happened to you? Would someone be able to run your business if you became unexpectedly ill or had a family emergency?
The idea of diversifying the operations of our business so that it doesn’t depend on you to run can be scary. It can also be a hit to your pride. You started the business. It’s your baby. The good news, though, is that if you’ve paid attention to the other challenges, you’re almost there. Allowing yourself the flexibility to diversify your clients, bringing in experts or hiring a professional to assist with finances, training people to take on your work to avoid burnout, and adjusting your processes are all ways to help decentralize responsibilities and duties in your business’s day to day functions. The only thing left is to ensure that you have a process in place for your employees to make important decisions if something happens to you. Looking to get in touch? Contact me here!