With the Indian government launching various schemes to promote small scale industries in India, local businesses have been mushrooming all over the country with many startups making huge impacts in the past few years. But it’s not easy, there are abundant problems faced by entrepreneurs.
While companies like Paytm and Flipkart are an example of what a startup can achieve in a few short years, there are certain problems that almost all entrepreneurs face while starting out.
Here are 7 problems faced by entrepreneurs & how to tackle them:
1) Financial & cash flow management
Getting your business funded is one of the main issues that all business face and have to tackle in order to survive.
While you might have initial money saved up to start a business, they don’t survive for long and you cannot just rely on the next sales check to arrive so you can pay the bills and take care of the next step in business.
A steady flow of cash is essential for small business to survive and you always need to have extra funds to take care of rainy and in-between days.
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Many entrepreneurs struggle to make ends meet and at times don’t even pay themselves so they can clear the invoices in time.
What you can do is plan your finances better so there are no delayed invoicing and you have enough gap in between getting the money, clearing the invoice and paying your employees (including yourself) salaries.
For this, you need to make sure you have a well-prepared business plan in advance and that includes funds set aside to weather the worst-case scenario.
Remember you are new so you will have limited availability of funds, and thus you have less room for error.
You will also not make a profit right away so have enough funds set aside before you start and add it in your business plan and budget accordingly.
2) Hiring employees & team building
We all have faced interviews at one or other point of our lives and for many, it has been one of the most stressful points in their lives.
While we all have been in the above situation one point or the other, there are very few of us who have conducted interviews and it is equally hard if not more as the majority you have not done it before and thus have no idea how to go about it.
Related: How to hire employees during your initial startup days
The situation is only more stressful by the fact that you are doing it as a new entrepreneur and thus want to pick that perfect candidate that not only fits your budget but is also proficient at the work they are being hired for.
Picking the right combination team for a startup is equally stressful as you have no idea how the team will work together even if the candidates are right on paper and efficient working alone or on their own.
It is thus advisable that you be exclusive and look beyond resumes and job requirements. When posting jobs requirements be specific about what exactly are you looking for and with what budget and benefits.
Make sure you mention what qualifications candidates must have and what the job duties would be required and what hours and days they would be working.
This will save yourself a ton of time as people who would apply would be aware of the budget and duties while applying.
Once you have a pool of prospects, take them on a company tour and show what exactly would be the environment they would be working in. This will give you and them an idea of what to expect and how they react with your staff will give you an idea of how they gell with your team.
You can also try reaching out to remote areas as workers in small cities and villages often want to move out and once trained can be a great choice for the entrepreneurs.
Further for jobs where a person doesn’t need to be physically present in the office to work, look for skilled workers in other cities and states as this can end up saving you a lot of money that would otherwise be spent on developing a physical office for them.
This will also provide them with an opportunity to work with a company that is based in metros and move out when required.
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3) Dealing with the unknown and self-doubt
Every entrepreneur, especially the ones that are just starting out, doubt themselves and often question if their business will work, be profitable and survive with time.
They also often doubt if their product with work and if the customers will accept them.
There is no getting away from these questions and none of them has a solid, reliable answer till you are in that position.
There are many unknown factors and many of your long-term plans often will remain in flux depending on new developments that take place.
Dealing with this volatility is one of the hardest parts of being a new entrepreneur and all you can do is remain calm and deal with them as they come.
Follow and promote work relaxation and instead of getting discouraged motivate yourself and look at your list of goals and tasks to do today and try to achieve them than worry about the future unknown that might or might not happen.
One of the hardest and most stressful problems faced by entrepreneurs is decision making.
New entrepreneurs have a harder time making decisions as they often equate even small decisions with how it will impact the company and its budget. Self-doubt also makes them question the decisions they have made already made and if it was the right one.
It’s is only with time that they learn to take hundreds of decisions a day, big and small, without questioning themselves and often facing decision fatigue.
While it will take some time and experience to reach that point, they can start by following the 5 steps of the decision-making process to make crucial decisions.
These are – Identifying their goal, weighing their options, considering the consequences, make the decision and evaluate it before giving it a nod.
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For smaller decisions, they can also allocate it to the people they trust and are best suited to that department and would know what works for you the best.
5) Facing Criticism
One of the constant problems faced by entrepreneurs is criticism. Be it about their business ideas, small failures in business decision making or starting the business in the first place.
Even big entrepreneurs like Ratan Tata and NR Narayana Murthy have faced criticism and still face them.
As a new entrepreneur, you might face it more and would be constantly warned about the various ways your business can fail. Sometimes these critics might even get personal as they’ll feel jealous of and threatened by you.
As a good entrepreneur, you need to learn to face them head-on and separate the wheat from the chaff.
Basically, you need to look at genuine criticism, evaluate it and fix them so you don’t face it again.
Put aside unhelpful comments and ‘advice’ and use the genuine one to take your business further up.
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6) Finding customers
It’s really hard to attract customers for any company that is starting out especially if they are a business with limiting marketing budget.
This problem always plays on every entrepreneur’s mind and the fact that people tend to stick with well-known brands they’re familiar with makes it harder for them to sell their products.
But new companies hold a big advantage over brands and that is their pricing is much cheaper than their rivals.
If they provide a high-quality product at a much cheaper rate than their rival, they will not only be able to attract new customers but also retain their customer who will become loyal to them over time.
7) Time management
When you are starting out with a new business time management might be one of the biggest problems faced by entrepreneurs.
As a newcomer, an entrepreneur has to take up many roles and don as many hats as he can.
He or she has to accomplish a lot in a limited amount of time and thus is always running from pillar to post to take care of things.
While the limited time and funds are something that no one can control, what you can do is have a strict schedule that allocates your time and money to each task.
As a newcomer, you cannot afford to waste time as it will only cost you more in the long run and you thus you need to be smart about allocating each minute.
For this, you need to create a goal list which is divided into weekly goals, monthly goals and annual goals.
Plan your week accordingly and break them down into specific tasks for each day.
When you focus on achieving your daily goals you will automatically reach your weekly goal and in turn your annual goals.
This will also help you keep track of things and let you know where you stand on your business goals.
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