The assertion that small businesses are the backbone of any economy is true. They have fewer than 500 employees and they account for more than two-thirds of new jobs created across the globe. They are also responsible for a lot of innovation. But in a number of respects, small businesses are at a distinct disadvantage compared with their larger competitors. And that’s why some argue that government policies that favor these big firms are important. Some of the downsides of Small ventures include:
1. Time Commitment
In the beginning of any small business it is likely that they will have few employees leaving the duties and responsibilities to the employer which will in turn lead to strain on the family and friends and add stress to the launching of a new business. Small business owners are reported to be working more than eighty hours a week handling everything from advertising to banking to even purchasing.
Even if the business has been structured to minimize the risk and liability to the owner, risk can’t be completely eliminated. For instance,leaving a secure job to follow an entrepreneurial dream and the business fails, this financial setback can be hard to overcome. Beyond financial risk,one needs to consider the risk from product liability, employee disagreements, and regulatory requirements
Though the business may be successful at the start, external factors such as downturns in the economy, new competitors entering the marketplace, or shifts in consumer demand may stall the businesses growth. Even if one goes through a comprehensive planning process they will never be able to anticipate all of the potential changes in the business environment, but vital to buy Twitch followers.
4. Key Lessons
When you are a small business owner or a would -be-entrepreneur, most of the time the odds are usually against you. About half of all new establishments survive five years or more and about one-third survive 10 years or more. As one would expect, the probability of survival increases with a firm’s age. Survival rates have changed little over time. That’s why it’s so important to understand how and where things go wrong.
5. Flawed Planning
Starting a business without planning where you want to go is like starting a car journey with no idea of your final destination or a map to get there; you’re bound to get lost. To avoid this mistake, set a clear goal of where you want to be and how you plan to get there. This will help in the survival of the venture.
6. Failure to Assign Duties
Within every business, someone needs to focus on the bigger picture and have an overview of everything happening internally and externally around the company. That person should be you, but if your head is buried in the accounts, you won’t. So delegate and outsource all the tasks that can be done by others, and free yourself to concentrate on the bigger picture.
As a small entrepreneur, you can’t afford to stand still while your market and the world around you move forward. Adapt and develop your small business so it’s forward-thinking and innovative, not Forgetting That.
8. Cash Flow
A small business needs to monitor its cash flow closely. As soon as it loses track of the money coming in and going out, its vulnerability becomes higher.
9. Lack of Knowledge
When you’re a small-business start-up, knowing which questions to ask is difficult. There are numerous resources, such as the Small Business Association, Local Economic Development Agencies, and Chambers of Commerce, that are great places to start. Part of the process is “knowing what you don’t know,” and such organizations can help you figure that out.
10. Lack of Objective Targets
Failure to measure the success of campaigns, products, or services can be disastrous for a small business. The PR campaign you run should be worth the money you put in. Find out also does social media really bring traffic to your Website? Know what to measure, and you’ll know how successful you are.
The entrepreneur’s challenge is to balance decisiveness with caution—to be a person capable of seizing an opportunity but also one who has done enough preparatory work to be well informed and not assume unnecessary risk. Preparatory work includes evaluating the market opportunity, developing the product or service, preparing a good business plan, figuring out how much capital is needed, and making arrangements to obtain that capital.
While avoiding these pitfalls won’t guarantee small-business success, knowing what not to do can help you to be proactive and focus on the things you should do. Plot and analyze your incomings and outgoings to make sure your small business stays on the right financial track. Don’t expect massive profits from the outset, but don’t accept a loss, either.