Common obstacles for small business owners and tips to overcoming them.
Small business owners are faced with various obstacles while running their companies from cash flow issues to time management, among others. Below are several common issues faced by small businesses and tips regarding how to best overcome them unscathed.
Natural disasters and other interruptions to business operations: Natural disasters, global pandemics (such as COVID-19) or other interruptions to normal operations that are out of a business owner’s control can have a huge negative impact on a small business’ wellbeing. Even if a small business has insurance coverage to protect against events like floods, fires or earthquakes, according to FEMA, approximately 40 percent of businesses that are disrupted by natural disasters are forced to close permanently, which is why all small business owners should consider taking out a business interruption insurance policy. This insurance can be used whether the interruption is caused by a natural disaster or a massive disruption to a businesses’ supply chain. Certain policies may also cover a business’ fixed expenses, financial obligations, and costs tied to finding a temporary facility, among others.
Cash flow issues: All small businesses face the potential of having cash flow issues at one point or another, which is why its important to have an emergency savings fund in case a shortage occurs. Another option is to take out a term loan or a line of credit, which will provide you with a source or working capital in the event you run into cash flow issues. A term loan or line of credit can also be used to provide you with a security blanket in the event a cash flow shortage occurs in the future. If you are in need of an injection of funds, Penhurst Capital offers short-term loans, cash advances and lines of credit, among other products to help small businesses continue to thrive.
Employee retention: Some business owners have trouble retaining quality employees. In order to prevent this, offering employees a competitive salary or wage and a solid benefit package goes a long way in keeping employees around. In addition, appreciation strategies such as naming an employee of the month (accompanied by some sort of incentive), a performance-based incentive program, appreciation lunches, or simply words of affirmation can also let employees know they are appreciated for a job well done and that will make them feel good about themselves and thus, likely cause them to stick around.
Changing market conditions: In the event of changing market conditions, it is a good idea to increase on-hand inventory whenever its possible, while making the best of the inventory you have, and being upfront/honest with your customers if inventory shortages occur (and offer other similar solutions).
A business owner can also review and revise their product lines to concentrate only on what’s most successful, and if needed, assess whether they can reduce staff, overhead, and other expenses. Another option to fight changes in market conditions is to begin offering secondary products/services (based on customer need/demand).
Time management: Business owners are often required to wear many hats throughout the course of the day, which can cause burnout. In order to help prevent burnout, it is important to prioritize tasks, set workhours, delegate tasks, hire additional help (if needed), set boundaries(meaning not taking on every single request), and establish a positive work environment.
