If you start your own small business, it’s usually because you want the freedom to do things your own way. As an employee, you have to go along with what your supervisors want you to do whether you agree with it or not, even if it’s obvious that there is a better way to do it. However, it’s not exactly easy to transition from an employee to an entrepreneur.
Before you create a business plan, you need to create a life plan. If you don’t, your business will not support your personal life goals and may even work against them. When building your business plan, you need to consider many factors to create a good plan, including your finances, your skill sets, your ability to manage projects and your marketing strategy.
However, despite all this planning, you will still come across some unexpected difficulties.
With that in mind, here are some common small business problems that you might face:
Your invoices don’t get paid on time.
Your business depends on cash flow. Without a sufficient amount of money coming in, you can’t pay your office rent, your utilities, your staff wages, and so on. And, of course, when you don’t pay your bills on time, things slowly begin to fall apart. Consequently, you need to get paid by your customers as soon as you complete the work to stay in business. However, what if you’re in an industry where customers are accustomed to getting a 30 or 60-day credit? How do you manage to avoid a negative cash flow situation crippling your business?
One solution is factoring–selling your invoices to a financial service that will then collect from the customer when the bill is due. Factor Finders can help you resolve cash flow problems that arise when you’re dealing with slow paying clients.
You’re easily frustrated when managing people.
Unless you’re planning on doing all the work yourself, you’ll need to hire a few people to manage the workflow. Unfortunately, managing people is not as simple as telling people what to do and then expecting the work to be done well and in a timely manner. People are quirky, and they often do unproductive things, even destructive things, that could hurt your business. For instance, they may not work productively or they may give customers discounts without your permission.
Here are two possible solutions if you find yourself in this situation:
- Improve your hiring process. By improving your screening process from reviewing resumes to interviews to doing a background check, you could avoid many of the problems associated with hiring unmotivated employees.
- Take classes in management. There is a whole body of knowledge on how to manage people. You will not only learn the psychology of managing people but also how to set better strategies for your business operations, how to coordinate employee efforts, and how to accomplish your goals through better use of your available resources.
You’re working all the time.
One of the biggest problems of being your own boss is that your business takes over your life. Since you’re in charge of everything, you may have to work long, hard hours to keep on top of it all. If an employee messes up on a project, you may have to correct it. If a customer is dissatisfied, you may have to appease them. If a vendor fails to deliver, you have to find out why you didn’t get your expected shipment. Besides all this troubleshooting, you still have your usual administration responsibilities. Without realizing it, you begin to feel an increasing sense of mental confusion, emotional upset, and exhaustion. The solution to avoid burnout is to take time out from your business every day to do things that completely refresh you.
You’re not keeping track of your finances.
Sometimes financial problems aren’t due to insufficient business but due to your being too busy to keep your books in order. As a result, you may fall behind in paying your bills or spend too much money. If you find yourself falling behind in financial management, you need to hire a bookkeeper or an accountant.
Perhaps, one of the most important skills you can learn as a business owner is how to get good at problem solving. While running your own business could be the most satisfying way to make a living and your best chance to build wealth, expect unexpected problems as part of the journey.