Don’t Let These Challenges Stop Your New Business from Achieving Success
For any up-and-coming business, it’s normal to have many concerns as you open your new business, overwhelming any new business owner. But challenges are normal in business—you’re not alone. In fact, most owners have issues that overlap with one another, despite different industries or businesses. These tendencies make finding solutions more common than one might expect.
That’s why we put together this list of the top ten challenges a new business owner will likely face.
1. Increasing Profit
This probably seems like a no-brainer: Increasing your profits is the key to your company’s success. Yet as much as this may seem like a no-brainer, many people struggle to find the solution. One key aspect is to determine your break-even point each week. At first, there will be some losses as the business needs time to grow. We recommend ensuring your weekly intake is enough, while setting your goal slighter higher each week. As you build better customer relationships and gain traction (i.e., through referrals and recommendations), your profits should move with it.
The biggest mistake a new business can make is the pricing they choose in their opening weeks. Some business leaders believe lower prices will make their new business more successful—otherwise known as undercutting the competition. While this may seem like a successful tactic at the beginning, it likely isn’t a sustainable tactic, resulting in eventual price increases down the road.
Alternatively, other business leaders take the dangerous leap to price their product or service higher, believing that people will pay more for better quality. But this tactic can also give customers a poor impression as they associate this with “high-end” products and reject them.
In turn, researching competing businesses in your industry before opening will give you a general outlook on ideal pricing for your products or services. Finding a median price that isn’t too low or high is essential. This will allow you to adjust over time, while also guaranteeing profits.
Cost analysis is a key component of conducting your research. Business leaders who limit themselves on spending risk minimizing supplies needed by your staff, causing shortages or delays in production. Alternatively, overspending can reduce the amount of money necessary to support other aspects of the business. That’s why we recommend learning which aspects of your business will require the most money for their development and which can be restrained. As your revenue increases over time, costs will become second nature as you estimate without too much issue.
Every business is limited by regulations and compliance restraints. And having a strong understanding of those regulations can be extremely challenging as the government expands, removes, and rewrites regulations. Always use federal and state regulatory websites for research and monitor changes as you go. That way, your business avoids any issues when those pesky regulators come knocking.
5. Hiring Staff
If the phrase ‘research’ becomes monotonous in this article, it’s because research is one of the most important things you can do as a new business owner. Businesses fail all the time because they neglected their due diligence.
Likewise, in hiring staff, determining what your industry requires is an essential part of the development process. From abilities to salaries and benefits, a key understanding of all these HR protocols will give you the tools for success.
6. Staff Management
People don’t like to be “that person” when it comes to disciplining or managing your staff members. However, lackluster employee performances should be addressed, so your business is always moving in the right direction. That’s why we recommend reading best practices for managers and owners before opening can help, so you’re creating a healthy work environment and providing the strength and leadership to direct the company and its members.
7/8. Revenue Maintenance and Internal Improvements
Once you’ve successfully proven your business’s strengths, maintaining those strengths becomes the challenge. No business is static in its development, that’s a mistake too many people make as they undertake it. A company is a living organism and like any creature, it must grow and develop on its own.
As you move forward, gathering information from customers, clients, and staff on growth opportunities is a keen insight.
9. Direction and Planning
A business plan is critical to business development and should be consistently updated as new factors come into play. Planning may be burdensome and complicated, but no successful enterprise has ever succeeded without a foundation. Further, developing a plan will give your business a sense of direction as it moves forward. The absolute certainty that an owner has can match itself in their employees and translate to greater success over time.
It’s better to have a solid foundation than “wing it” as so many try and fail to do.
10. Time Management
Time management is key to planning out the long-term outlook of your business. On a more individual level, managing one’s time in the organization can avoid the many pitfalls that affect first-time owners.
Determining which aspects or sections require the most time and attention is key to overall management. It’s easy to get trapped in redundant tasks that limit your daily effectiveness.
The famous “80/20 Rule” is a great way to look at time management: 80% of your results come from 20% of your allotted time, meaning you’ll get the best results from the shortest amount of time.
By no means, does this suggest, you should completely withdraw from your company and its general direction. However, it does develop the idea of keeping oneself occupied on the central tasks of the position. In this sense, one gets the best time strategy and the strongest maximization of your own talents.
These challenges face every emerging business, but Datix is a resource that can help you! Contact us today to implement enterprise software solutions that will minimize your business challenges and maximize profits!