There is nothing more exciting than working over your own business venture. Some people are blessed with business-ready attitude and logical thinking; two of the most important attributes for getting into own business domain. But sometimes these are not enough to guarantee a successful business. There are some external factors which may act as the hindrance to the growth of business and the entrepreneur.
When you research for the to-do’s list while setting up a new establishment, you must also know the things which may pull you back. Knowing them beforehand can help you prepare for the challenges, well in advance. You will also have sufficient time to come up with the solution or even recover from the loss if any. Consider the following top 5 factors:
Strong Market Competition
This century has witnessed a ton of advancements in the field of hospitality, research, medicines, products development in various domains, technology, education and as a matter of fact, in every possible domain. This has opened large number of business avenues, especially due to the spread of awareness channels (majorly through use of the internet) which has resulted in stronger market competition than ever before. Now the new budding entrepreneurs have a pressure to consistently think out-of-the box and importantly, keep up the pace with others. This is positive in one sense, but too much competition can lead to wrong hasty decisions, making small businesses suffer a loss that could be difficult to cope up.
High Interest Rates on Loans
Small business can demand heavy investments, especially at the time of their rapid growth. The business might need a loan amount to sustain the developmental needs of the business. But even the most successful entrepreneurs can hesitate in making this decision. This is because the interest rates of bank loans are too high to be managed with the revenue from an uncertain natured business. The interest amount can sometimes be close to the principal amount. A loan is obviously a liability over a business hence a lot of thoughts should go before pursuing the banks or money lenders.
Lack of a Strong Management or Advisory Team
A successful business is a result of skills, hard work and a bit of good luck. All the work efforts can go waste in case of an unsettled management or advisory team. The appropriate people at management and advisory level positions can make a huge difference. But it is very difficult to find people that could share your vision and mission for the progress of business and every individual employee. Due to prevalent self-centralism and cat race, it is becoming a challenge to build a strong management team that could think straight with one goal in mind.
A Practical Lack of Access to Necessary Technology
The point #1 states the “market competitions” as one of the hindrances to the success of a small business. The introduction of software applications in the world of business is another reason for the market to become competitive. The strategists are more convinced to include automation into every possible department of the company in order to save time and money for their small business. But for some business, this option is not as simple to implement as it looks. It may happen that a simple tool like online check stub maker cannot be accessed due to low internet speed or lack of technical support from the service providers. Such scenarios can be great setbacks to the competitive aspect of anyone’s business.
Supporting a family is a highly demanding job. They need moral, financial and future-enhancing support from the small business entrepreneur who is looked upon for fulfilling all their demands. Excessive and unreasonable demands, however, can lead to troubles, majorly for the business owners. Demands like favouring the relatives in the family business, sharing high profit margins amongst the family members, unreasonable expenditure by people of the family which can cause heavy financial dent, non-support from family & friends while stepping into a new risky business idea, are few of the certain instances that can pull back your small business from becoming extraordinary.
Study and understand these hindrances. You may have better ideas to either avoid them or completely banish them. Add more points to these hindrances or suggest the solutions, in the comment section below.