You are a budding entrepreneur, an individual who is simply not willing to settle for the status quo. Your vision for working for yourself is about to come to fruition as you have found the right business model with much potential for success. Even so, there are challenges that every entrepreneur will face when planning, launching and maintaining a new business, including the following seven.
1. Money. Ask an entrepreneur about their most significant business challenge and the answer may be financial. Business owners usually do not make a lot of money during their first year of operation, therefore they may choose not to draw a salary for at least the first several months. Start up costs — such as fees, licenses and the usual unforeseen expenses — can take a toll on any emerging enterprise. Before you launch your business you must calculate your expenses for the first year. You should have enough money set aside to live on those funds until you are able to draw a salary.
2. Customers. Unless you already have a customer base in mind, you will have to start your business from scratch. This might present a big challenge, especially if your business is taking you through unchartered waters. You may find yourself spending an inordinate amount of time trying to find new customers and doing little else. Preferably, your customer base will be lined up before you launch your enterprise. In any case, work hard on referrals and network like your business depends upon it. Because it does.
3. Career. The best way to launch any business is to do so when you are still working at your regular job. If it is possible to do both, then you have the security of a paycheck coming in. The dilemma that you will face is when to quit your day job. The easiest answer here is this one: when you can match your salary. This may be difficult for you to do if you are burning the candle on both ends and the rest of your life is suffering for it. A happy medium may be for you to quit your day job as soon as you begin drawing a salary from your entrepreneurial pursuit. It is a gamble, but so is launching a business in the first place.
4. Taxes. Yes, the tax man cometh. And he comes again and again, and in ways you may never had previously considered. Taxes must be paid or you may risk losing your business. This means setting aside quarterly taxes to the federal government and, in some cases, to the state government as well. Other taxes can include: state sales tax, employee matching payroll contributions, and Social Security and Medicare contributions. Always stay current on your taxes even if it means a delay in taking a salary.
5. Legal. Some business initiatives can be started on the side without any formal entity launched. A problem arises when your hobby becomes a business. It is at this point you must give serious consideration to your business structure. Contact a business attorney to discuss your options, including when to file legal papers for incorporation. This step involves an expense, one that some business operators may find much more costly than anticipated. Nevertheless, it is a bridge that you will eventually have to cross.
6. Doubt. You have what you believe is a very good business model, but doubt continues to stalk you. You are doing everything right, yet there are days when it seems as if everything is going wrong. This is not a predicament you relish, so how best to deal with it? First, surround yourself with supportive people. Second, vanquish doubt the moment it rears its ugly head. Keep looking forward, refuse to look back, and do not be so proud that you cannot ask for help.
7. Competition. Ah, competitors! Unless you reinvented the wheel or have come up with an absolutely new product, then your competition is insignificant or non-existent. Even so, people will do their best to jump in with their own business model, especially if your business shows signs of success. You cannot worry about what your competitors are doing, though that does not mean you should dismiss them. A healthy awareness of what they are doing can be beneficial. You just need to find the place where the “healthy” in competition can exist.
Winning the Battle
Certainly, there are other challenges in running your business. If you start off by yourself, then that’s just one challenge. Once you begin to hire employees, another set of challenges will arise. By then, you should have strengthened your business to the point where you can withstand whatever is thrown your way.
See Also — 7 Tips for Effective Business Networking