Published on February 22nd, 2013 | by Lena Martin
05 Things That Make Starting a Small Business Hard
Let us face the cold, hard facts: it’s not easy setting up a small business. In fact, most of the time it would seem that everything is conspiring against the success of your small business, and it takes special effort to rise above the challenges and get things going. Some businesses get a free pass, of course, and manage to set up smoothly and without much trouble, but that’s not the case usually. Here are five obstacles that entrepreneurs are usually faced with when starting a small business.
A troublesome legal process.
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As far as legal issues go, it is different for every locality. Every country, state, province, and even small town has its own little legal quirks that you would have to pass through before becoming a legitimate business, and they will not always be the most convenient and reasonable process. Laws are never perfect and always changing, but unfortunately they are a necessary step towards the start of your hopefully successful small business. A few of the things to expect before getting those permits and forms are: ridiculously expensive fees; inefficient standard operating procedures that would take you from window to window, office to office; and even corrupt officials and personnel that would do everything in their power to make it harder for you than it should be (that is unless you are willing to pay “extra fees”).
Unfortunately, there are usually no shortcuts, at least none that would not have you breaking at least one rule or policy, so going through the due process is inevitable.
The wrong people.
A good number of small businesses start out as the brainchild of not only one but several people. Forming partnerships and making agreements, these people split the responsibilities as well as the eventual rewards that the small business will bring. The only problem is that not all teams work out seamlessly, and there are those unfortunate partnerships dissolved by petty squabbles and misunderstandings. One of the most common things to fight about is money, of course, who is entitled to how much and who has control over what. Pride and greed are the culprits why some small businesses falter, which is why teaming up with the wrong people is a sure way to turn the start of your small business (if not all of it) into failure.
No capital.
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They say money is the root of all evil. In this case, however, money is the lifeblood of business. Successful entrepreneurs would lecture not to worry about the money, because there will always be a way as long as you persevere and as long as you have a winning idea. That doesn’t mean you don’t need the money anymore, though, and if you can’t muster up the capital somehow from somewhere, then you are not going to go very far. It is true that there would always be a way to get what you need, but you actually need to find that way for it to be of any use to you.
As it stands, capital is important and not having it is more than just a bit troublesome. This has stopped quite a few businesses in their tracks, and will likely continue to stop even more from now until the future.
Bad location.
Location, location, location. Almost everyone has heard of that phrase at least once in the past. It acknowledges the fact that where a business is based is just as important as the other factors. Having a bad location can mean any of several things. The first is that customers would find it hard to get to you and if they can’t get to you, then there wouldn’t be any money made. Another thing is that it might be hard for you to acquire the resources you would need in manufacturing your products and supplying your employees with what they need. Even online businesses are never totally immune to location issues, because there will always have to be some kind of main office where everything will take place. I repeat: location, location, location.
Poor planning.
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You could have the proper permits, the best people, all the money you need, and the prime location but everything crumbles down in the face of poor planning. Not only does this refer to short term plan that involves making profit from day to day in order to keep the business afloat. It also refers to the more strategic, long term plans that would deal with possible expansion, bigger offices, rebranding, franchising, etc. Small businesses can be very successful at one level but then fail completely once it tries to grow and push its boundaries, and all of this can be blamed on poor planning. At the very start, if you do not have a concrete plan on what to do, then how will you even get your small business off the ground?
These are just five factors that would stand in your way towards successfully starting your small business? Did you encounter any of these when you were just starting out, or did you face other obstacles aside from these?