There’s no doubt about it: starting a business from scratch is hard work. It takes guts, perseverance and a lot of patience.
For the most part, it’s also an iterative process and one that requires you to be both proactive and reactive along the way.
Here are the five biggest challenges when starting a new small business:
- Getting Funding. One of the biggest challenges for entrepreneurs is getting funding to start their business or to grow their existing startup. If you decide to seek funding for your startup, make sure you have a solid business plan that details your company’s mission and the specific ways it will earn revenue and make money over time. If investors like what they see in your business plan, they may fund your startup.
- HR and Legal Issues. Many startups face challenges dealing with hiring employees, firing employees, documenting employee information and understanding employment laws. If you’re unsure how to handle HR issues, hire an outside consultant or law firm that specializes in HR issues — it’s worth the cost in the long run to avoid legal issues down the road.
- Marketing. Simply putting your product on the market isn’t enough — you need to get the word out that it’s available. This means having a marketing plan that encompasses advertising, public relations and online marketing tactics.
- Organization. Your small business might not have much structure in its early days, but as it grows you’ll need to develop a system for organizing everything from client lists to accounting records so you can run your business smoothly and effectively.
- Hiring the wrong employees (or not hiring enough). It can be difficult to judge people’s ability to do a job well. It’s also a lot harder to fire someone who isn’t working out now than it was when you were the only employee and could just say, “I don’t need your help anymore.”