Search the internet and you’ll find thousands of money-making opportunities that may instantly attract you. Yes, these are legitimate opportunities and anyone who is determined to make it online, really has great potential to succeed. But why do some marketers fail at running their business? What are the obstacles they faced that you can expect to meet as well?
Many would be entrepreneurs get interested in starting their own business thru advertisements promising great wealth, immediate success and very little work needed on their part. That is FALSE. There are a lucky few who luck into a business opportunity where they don’t need to put in long hours daily or put forth much effort. But those people are in the MINORITY. Most business owners tend to put in more hours then their staff! Of course that is in the start up phase. With good business management and delegation of task you can indeed create a 4 hour work day for yourself. But it usually doesn’t happen overnight.
Having The Right Skill Set
A HUGE STARTUP BUSINESS challenge is lack of skills. Some people have a good idea but don’t have the knowledge behind them to make it a success. A way to overcome this is to look into purchasing a franchise, finding a mentor, or even going to work for a similar company and learning the ropes. Being able to listen to a few tapes or watching a few videos will not give you the real world experience that will help you run a successful business. My dad is in the real estate investment arena. He sees unqualified people all the time buying homes in order to flip them, but they have no idea of what they are doing. It takes time and experience to be successful in “home flipping”. So many people would be better off working with an experienced investor before stepping out on their own. The same advice is good for anyone who is starting a business that is outside of their current field.
If you fail to plan, you plan to fail! Don’t even think of opening your own business without creating a business plan. A business plan not only helps lenders decide if you have a viable business project. But its a guide that you can use to make sure your projections are on track. I’ve seen some business owners revisit their business plan on a monthly or bi-monthly basis! Why? So they can make sure things are running according to plan, and if they are not, They make adjustments.
Poor / Wrong Product
Another big startup business challenge is having a poor product. When starting your business, I’m sure one of the first questions you should think about is, “what do I sell?” Not having an effective product or a service to offer will definitely hinder your success. Before starting a business, make sure that you do your research. How many people are looking for your product or service, what kind of competition does that market have? What is your USP (unique selling point) , in other words, how will you stand out in the crowd?
Poor Financial Planning
Starting a business on a “shoestring budget” can be done, but its not ideal! Lake of funds is another startup business challenge that every new business owner must face. When you wrote your business plan, make sure it was realistic! Banks are reluctant to finance new businesses. They are considered EXTREMELY high risk. So you have to manage your working capital with the thought in mind that most banks want to see a minimum of 3 years in business before they will give a working capital loan to a new business. And of course, they want to see excellent credit from the business owners.
Make use of business financial products such as equipment leasing to preserve your startup working capital. Equipment cost tend to be some of the largest purchases that a new business has. By leasing doing a lease to own. You get to use the equipment for a small monthly payment instead of depleting your working capital. Equipment leasing is also open to business owners with bad credit.
Lack of patience.
Again, challenges can be expected and if the entrepreneur doesn’t have the patience or the drive to face up to these challenges, the business will surely fail. So many business owners give up when it becomes too tough for them. Some of them, if they had hung in there a few more months, they could have seen their business succeed.
Irish Taylor is a business loan consultant with Startup Business Loans and has been providing consumers and business owners with startup business financing since 1992. For years she has helped people with credit and loan problems especially pertaining to business start up, SBA loans and Unsecured loans.