3 Issues You May Face in the First Year of Running a Small Business

There are three major issues you will face in the first year of running a small business but there are a myriad of others that will face you until you as the owner find a solution to each and every one of them. You as the ‘boss’ have to sort these answers out because the buck stops with you. If you don’t sort them out, you will lose “big bucks” because there is no-one else for you to blame. You are now the responsible person. 

Problem number:1

Will be finding a suitable banking facility that will meet your needs and requirements. As basic as this appears, it is fundamental to the smooth running of any business. The best way to overcome this is to have a good relationship with your bank manager or banking institution.  Someone that you can talk to easily and explain what your needs are which you often won’t know until you have been in business for some time.

One of the financial difficulties often exposed is one between creditors and debtors. Some of your suppliers (creditors) will want payment ‘up-front’ before delivery of goods or services. Initially, until you have established a good reputation, this is understandable but if your customers (debtors) don’t pay their bills in a timely manner, you will be out-of-pocket and will need to have an over-draft facility in place to cover this type of customer.

It is strongly recommended that you have as few of these types of customers as possible. Make as many of your sales cash sales so you aren’t carrying debt. There is no reason at all why you\should be providing credit facilities to your customers or funding their businesses. After all, unless you are in the banking industry, why would you want to fund someone else’s business? 

Problem number 2:

 

Will be developing, implementing and practising good time management skills. It is far too easy to overlook the importance of taking time off when you run your own small business.

It has now been scientifically proven by a University in South Australia, that when people are over-tired it has the same affect on an individual as being inebriated (drunk). When this state of tiredness affects people they tend to make very bad decisions. In the running of a small business this becomes a very costly mistake.

Problem number 3:

Once your small business starts making good profits and you can improve on them by employing help, then the problem of staff will rear its problematic head. Employing people brings another set of problems. No employer yet is clairvoyant so if you employ someone, then you will need to have a very good understanding of the law. Do be sure to check out references, Google and today you can even check their Facebook pages which will give you a very good insight into the type of character that you are considering employing. Do these checks before you say they have a job; there is little benefit in doing it once they are there on your books as an employee. 

There are many problems you will face in the first year of running a small business but with care and commonsense, they can all be overcome to make your business profitable.