Running a small business takes passion, guts, luck, and, of course, a great product. Business owners also need to be prepared to face and overcome their fears and anxieties.
There is no roller coaster in the world's best amusement parks that matches the unpredictability, thrills, falls, and butterflies in the tummy as those that come from running a business.
If you've managed a small business in the past, chances are you know these fears. And if this is your first time running a business, you will certainly face these fears very soon. Do better; read this guide and understand these fears, and learn how you can overcome them.
1. Not being good enough
It is a tough market out there; it's common for even the staunchest of self-believers to feel the jitters when they set off on their own. This is where entrepreneurs need to understand the idea of "minimum viable product." Your product or business model does not have to be perfect, really. As long as it is acceptable, you can set things off the ground and keep on building on top of what you have.
Considering the short time spans of trends, market volatility, and quickly transforming legal and financial ecosystems, businesses cannot afford to wait to perfect their products. Remember, striving for perfection, if it comes at the cost of waiting too long as your competitors continue to acquire customers, can put your business at a massive disadvantage.
2. A cash crunch
Invariably, sudden expenses hit small businesses, driven by market pressures or posed by opportunities. It can be a nightmare for a small business owner to face a sudden need for cash and not have access to resources. Banks can often be skeptical about issuing loans to small businesses. Further, the credit scores of many entrepreneurs may not be that great and that makes access to reasonably priced financing difficult. To salvage the situation, take the following steps:
- Cut your business expenses (consider colocation, BYOD [bring your own device] and remotely connected employees to control costs)
- Clear your debts to the best of your ability, and avoid credit card payment default (to build your credit score)
- Seek peer-to-peer loans, crowdfunding loans, and personal borrowings from friends and family to manage sudden cash needs, instead of breaking your annuities or drawing on your retirement funds.
3. Losing key employees
Research by Center for American Progress indicates that the cost of turnover for employees paid less than $30,000 annually is 16 percent of their annual salary! Consider these costs while deciding the salaries of your employees and negotiate with them during their appraisals.
To make your workplace desirable, offer employees the flexibility of remote work, to help them strike a good work-life balance. Also, consider some unconventional employee retention tactics such as:
- A relaxed dress code
- Relaxation zones in the office
- Employee social clubs
- Office game rooms
- Days when they can bring their children to work
- Healthy snacks
- Sponsoring employees' hobbies to a small extent
Ask any small business owner. Very quickly, they get used to facing big problems that seem to arise from nowhere. For beginners, however, the learning curve is steep. There are so many variables involved in everyday business that you just can't keep complete control on operations. A spike in raw material prices, a legal notice to prove your compliance, customer attrition, a competitor who's willing to undersell you to capture your market share – it could be anything.
This is where business owners need to accept the uncertainties and learn to trust their operational management processes. In the long term, a stable process helps your business sail through the crests and troughs of the waves of reality. Consider finding a business mentor who's seen it all who will not only reassure you but can help you adopt strategies to weather the storms in business.
5. The market leader
Big businesses can literally eat away a small business's vitality merely by their market presence, cash flow and existing customer base. However, for any entrepreneur, here are some tips to help you conquer this fear.
Ask yourself: How many truly monopolistic markets do you know of? There's a reason why every market has big and small players; coexistence is possible.
Focus on establishing exclusive relationships with suppliers by promising a major chunk of you procurement (or all of it); this can help you strengthen and retain your local market hold.
Differentiate your service by targeting a niche audience and offering personalized services.
Make no mistake, managing a small business is as exciting as it is challenging. Be prepared for fears, and more importantly, be prepared to conquer them.