Startups normally face a set of challenges. These challenges are needed to be dealt with utmost care, and if not, they could have grave consequences.
It is due to these challenges several startups struggle. Some even die within a few months, while others never grow. Many of them don’t anticipate obstacles, and even when they do, they won’t know how to respond.
But the question remains, what are those challenges that make it difficult for startups to survive?
To answer this, I am going to discuss the seven challenges commonly faced by startups these days.
Money is essential to business survival at any stage. But when it comes to startups, it’s more important than anything. Startup owners often struggle to run their business smoothly. They find it hard to pay for everything, from bills to employees and contractors. Due to a shortage of running capital, it becomes difficult for them to cover their day-to-day expenses and operate their business, hence they risk everything.
This is commonly due to the fact they don’t consider the importance of running capital, especially for the survival of a new business. Because of that, they find it really hard to manage their business and bog down against the pressure.
In order to avoid such situations, startups must allocate a decent amount for their running capital in their financial plan. They make take help from a reputed financial consultancy firm that may be willing to assist their business in managing the financial crisis.
Despite the nature of a startup, competition is one of the biggest challenges for their survival. When dealing with competition in the same industry, there are many factors that often pull your down. To handle the competition, startups need to play aggressively and make efforts to get much-needed recognition while operating in a competitive environment.
If startups find a niche and differentiate themselves from competitors, they can cut the incoming flow of competitive air. In fact, introducing unique products and services in the market can just help them to develop their own area of expertise where it will be easier for them to survive in the competitive environment.
3. Employee Hiring
For startups to grow and turn into a successful business, employees play an imperative role. Employee skills, expertise, and experience may determine how well your startup thrives as a team. And to develop a highly productive team, it’s the need for every startup to hire suitable candidates.
Finding the right people for your startup could be challenging. You will find a number of people with suitable and similar capabilities to fill up a position. Though you may try your best to hire the right people for different job roles, there can be positions where you may hire the wrong people. This often happens when you look to achieve quick growth by increasing your employees.
When hiring people for different roles, it’s important to realize their roles in your business are very crucial. And when you hire the wrong people they eat up your efforts and decrease your business productivity.
4. Time Management
There is never enough time, not even 24 hours a day when you are running a startup. There are many things to look after and work for. From making decisions and regular meeting with employees to the fulfillment of clients’ orders are a necessary part of every of every startup. So, avoid any distractions that come your way to run your business smoothly.
Make sure to prioritize your tasks and work on them accordingly. Set a deadline for each task and make sure to complete them in an estimated time frame.
Ask yourself what needs to be done right now and what could postpone for tomorrow. And what could be done to improve on your time management?
5. Customers Trust
For startups to survive and grow, another common challenge is making connections with their target audience and winning their trust. Startup customers are the real force behind their success. They give an opportunity to grow and find success against any competition they might face. So, if you wish to cement your position in the market place you operate, it’s imperative to develop a satisfied and loyal customer base.
However, a number of new businesses don’t find it an easy way to gain their customers’ trust. They find it hard to connect with them and grow their professional relationships.
Such startups should try to come with customer-friendly policies while offering them excellent services and extraordinary customer experience. Though it can be tough initially, however, understanding their needs with the ongoing time and taking regular feedback can help you build good strategies to win their trust.
6. Risk Management
Irrespective of how good a business is, there are always some risks involved. Risks are again a common aspect when it comes for business growth and expansion. Taking calculated risks is just a step ahead for your business survival in the competition that surrounds it.
Not necessarily, you will win with a successful plan. Many factors linked with its success often make it difficult to work upon. Accidents, technology breakdowns, and mistakes often make those winning plans challenging to implement. Therefore, it’s all-important to understand the risks associated with your business beforehand and develop effective strategies to handle them well.
Employee coverage plans, insurance companies, and others can all play a useful role in handling the risks involved in running your new business.
Your startup won’t be able to reach out to the right audience until you make the right efforts to market its presence. Marketing can be a large expense for your new business, but it is a necessary spend. It helps to tell the world what you do and what can you offer to them. For its effectiveness, it needs to be data driven, and if not executed in the right way it can turn to be very painful for your company accounts.
Often startups fail to implement the right marketing strategies. They fail to determine the right marketing channels that can help them communicate the message to the audience and obtain the right return on their investment. It’s therefore critical for startups to find the right marketing strategies that can help them grow their business. No matter if they fail at one strategy, they should keep educating their target market and must not give up. They must make sure to let people know their business value loud and clear.
Remember startups don’t succeed overnight. They need to handle different challenges to find success with the ongoing time. Some of these challenges can be avoided with careful planning while others can be handled with effective strategies. The above discussed are some common challenges faced by startups, so it’s all-important for each new business to learn how to handle them correctly.
Reference: The article has a contribution by Kirsten Pike who is a Marketing Manager at a reputable essay writing service company. She is a seasoned marketing professional who likes to educate readers with her research findings on different areas related to the business world. She is most interesting to write on areas related to organizational growth, business development, and entrepreneurship. When she’s is not working, you might find her traveling with friends in search of new adventures.