If running a small business seems like the ultimate struggle, don’t forget that plenty of other business owners feel the same. Professional challenges are inevitable, and the way small business owners respond to these issues plays a large role in their success or lack thereof.
Luckily, you can learn from the common challenges of other businesses. Here are five common small-business concerns, along with a few tips for resolving them.
1. Cash Flow Management
Handling finances correctly is a must for small businesses, but we all know how difficult it can be. Keeping complete spending records, tracking income accurately, planning for taxes, staying on top of business loans, and managing other expenses . . . it’s a handful. However, neglecting details and mismanaging funds can lead to tax audits, growth problems, and even business failure.
Luckily, there are plenty of smart strategies for cash management. It may take a little extra effort, but shopping around for deals on supplies, staying up on tax deductions, and sticking to a business budget can help boost your bottom line. Hiring a professional to do your bookkeeping or file your small business taxes can also prevent unnecessary financial errors—we can’t all be financial experts, so don’t be afraid to rely on those who are.
2. Managing Inventory
Similar to cash flow management, keeping close tabs on your inventory is vital to the success of any retail businesses. Bad forecasting can lead to excessive spending on unpopular products. Incorrect records might mean unfulfilled orders and unhappy customers. Sloppy organization, untrained employees, and unexpected human errors can do similar damage and create significant problems for your business.
That said, automating your inventory can help prevent many of those issues. There are plenty of inventory management systems and software, but consider your unique business needs before investing in anything too costly. Many point-of-sale (POS) systems can accomplish both, and using your POS to manage inventory can eliminate communication errors between the different programs.
3. Diversifying Client Base
If you’ve landed a few great clients in the early stages of your growth, take a moment to celebrate! This shows that your products are marketable and your strategies are working. Keep in mind, however, that it’s probably too early to increase salaries or move on to less important business matters. Neglecting to grow your client base just because you’ve reached a certain level of comfort can be a costly mistake.
To prepare against economic shifts or client loss, be proactive now about seeking additional clients. A few simple habits for diversifying your client base can make a big difference in the long run. Ask your current clients to recommend you to peers, or request feedback about how to improve your services. Consider pursuing a new market, and be smart with your online marketing. A constant focus on growth will protect you from devastating client loss or stagnation.
4. Brand Awareness and Consistency
This goes hand in hand with client acquisition. The more consistent, vibrant, and relatable your brand, the easier it will be to grow your business. On the other hand, haphazard marketing and mediocre employee training will leave you without a strong brand. These setbacks impede brand awareness, jeopardize your current and future client relationships, and inhibit company growth.
Luckily, a little bit of planning can prevent brand confusion and help boost brand awareness. Create an internal guide that establishes brand expectations in everything from font choices to customer experience. Train employees on how they can incorporate your brand into their specific job functions, and make a plan to build your brand online and otherwise.
5. Establishing Good Team Dynamics
When it comes to company culture and team dynamics, it all starts with smart hiring. Rushing to fill positions instead of waiting for the right candidate can cause unnecessary employee turnover or damage company culture. Transitioning from owner-run to employee-run operations also presents its own challenges for small businesses.
If you started your own company, keep in mind the need to grow alongside your business. Though you may have done it all in the beginning, eventually you’ll want to hire people who can do the job better than you can. Inability to delegate will prevent you from establishing an overall vision for your business, so don’t be afraid to take a step back when the time is right. Choose good hires, train them well, and delegate freely.
Working through Small Business Growing Pains
Along with business growth, you’re bound to experience plenty of challenges. With a few good habits like automating your finances, being consistent with your brand, and always pursuing new clients, you can sidestep strategic pitfalls and find success.
Madison Crader is a Salt Lake City native who specializes in helping small business owners build brand awareness and make the right decisions to grow their business. She has a passion for helping entrepreneurs understand their financial needs and set long-term goals by sharing tips and tricks.