6 Challenges Faced By New Entrepreneurs
Every Entrepreneur when he starts his business faces numerous challenges, especially if he is starting a business for the first time. This article highlights few of those and how to deal with them.
“I’m convinced that about half of what separates the successful entrepreneurs from the non-successful ones is pure perseverance.”
– Steve Jobs
1. Employing staff
Most young entrepreneurs likely have never managed people before. And if they have, the experience they have built up doing so is probably limited.
When they come to hire their first employee, therefore, their skills will be tested to the ultimate. It is never easy being the boss and even harder when you are the owner of the company and your profitability is at stake. Rules need to be set up involving such aspects as working hours, vacation time, overtime pay and work output, salary negotiations. people might even need to be fired or laid off. That’s not even to speak of staff fitting the company culture or of employees working together as a team.
Young entrepreneurs should make this process a little less troublesome by being careful to hire people who will not only have the right skills for the job but will also fit in well with the company culture. Take your time and consider each employee carefully; check all references. And Do not make any haste in hiring people. If it takes time to find the right employee, so be it. One wrong employee employed will increase your problems in many folds.
2. Scarcity of Capital
Almost all new ventures require seed capital — money that is available to see them through those first few rocky months or even years before they turn a profit. Some types of businesses need more money than others. Almost all need money for marketing.
Younger entrepreneurs almost always require financing due to their lack of experience in the field, knowledge of how the business world works, and connections within the business world, some build up over many years. As a result, they generally are unable to turn a profit sooner and need to rely on financing for a shorter time. They need money to sustain them while they gather that experience. In addition, younger people have not had the time to accumulate savings in the way older people often have and are likely to owe more in loans and on credit cards than their senior counterparts.
The lack of capital means that they have to struggle to survive while waiting for the checks to come in. This can be extremely stressful.
To avoid this situation, young entrepreneurs should write a detailed business plan that will give them a good idea of how much money they will need to survive before becoming profitable. Armed with that total, they should seek to find it. Friends and family and even a local bank or credit union might be able to assist them.
3. Taking Decisions
Whereas as an employee you generally did what you were told, now you are the one calling the shots. Doing so involves making a lot of decisions. Even without employees, you are going to be called upon to make decisions all day, from smaller ones to major decisions that could change the direction and future of your company.
Among the most important decisions are those that involve creativity and ideas. If an aspect of your company is not working as it should, you will need to make a decision to discontinue it or amend it. You will need to decide whether the company should embark on a whole new path in search of greater profits — or, if it does not work, potentially great losses.
It’s stressful and will cause you to have self-doubt. Here’s where your entrepreneurial skills come into play. You will need to believe in yourself, be confident that you do have the ability to make the right decisions, and never doubt your good judgment.
4. Criticism & Self-Doubt
As a young entrepreneur, you will find that not everyone will take you seriously. They will tell you that you are too young to build a successful business. They will be quick to tell you just what they think you are doing wrong. At times, the criticism and the self-doubt it fosters might get to you. As your business struggles to get off the ground, you could start to doubt yourself.
You might wonder whether you should have started your business after all. At times like these, tell yourself that determination and resolve are what distinguish the successful entrepreneurs from the rest. Do not give up. Believe in yourself and you will succeed. There are so many examples of successful people having struggled initially to convert their ideas and aspirations into a highly successful enterprise. What they did differently from others is, they persevered through all the trials and troubles and did not give up till emerged victoriously.
5. Lack of Brand Image
As a young entrepreneur builds a business, creating the right image is vital. Customers must come to trust your brand. They must recognize that you know what you are doing and you know how to do it well.
As you build your brand, ensure that you are putting the customers first, providing them with the quality goods and services that differentiate you from the competition. Take all complaints and comments, particularly from your customers, seriously, and do all you can to respond to them and change your operations if necessary. Take that extra step to ensure that you listen to all their complaints patiently and treat them as learning lessons rather than irritants. Those words will help you understand where are the shortcomings in the product or service. Happy customers are great marketers.
It’s a rarely mentioned problem of entrepreneurship, and many new business owners aren’t prepared for it until it happens. Being a new entrepreneur is lonely. It’s a singular position, so you won’t have teammates to rely on (completely). You’ll be working lots of hours, so you won’t see your family as often. And your employees will be forced to remain at a bit of a distance. Do not get disheartened by that, remember there is a rainbow at the end of the storm. Believe in your abilities and decision-making capabilities. You have already taken the toughest decision possible of becoming an entrepreneur.
Remember that if your main aim is to satisfy the customer you will make money. If your main aim is to make money, you will fail to satisfy your customers and your business will ultimately fail.
If you can work your way past these major obstacles, you’ll be well on your way to establishing yourself as an entrepreneur. That isn’t to say they won’t continue to nag at you as the years go on, or that new and varied challenges won’t arise to take their place, but you’ll be prepared to handle yourself in those most volatile and impactful first few months -- and that puts you far ahead of the competition.
It is a known fact that Successful celebrities and people of prominence always have a coach or guru to guide them, support them, and help formulate strategies that help them strive towards their vision. The same applies to business leaders as well, but most entrepreneurs do not really have a coach, and hence, hit a roadblock when it comes to setting formidable goals for their business, taking tough & tricky decisions, and working towards them.