5 Harsh Realities About Starting a Business Today — And What to Do About Them From hiring to delegating to the art of life/work balance, how to organize a business for success and avoid the most frequent pitfalls.
By Mike Kappel
Key Takeaways
- Finding the right employees is crucial for success.
- Be prepared for unexpected events.
- Assess the benefits and risks before choosing a source of funding.
Opinions expressed by BIZ Experiences contributors are their own.
Starting and growing a business is tougher today than ever before. You have to hire, manage and process payroll and are likely in charge of keeping the books and staying updated on tax laws. You might also have to deal with (and bounce back from) supply chain issues and the occasional emergency amid ample economic uncertainty. Operating an enterprise, therefore, is not for the faint of heart. Whether you are a principal in an existing one or are thinking of taking the leap, it's wise to consider the most pressing challenges you'll be up against.
1. Hiring and managing
Finding employees — and ensuring that they're the right ones — is, of course, vital. The average hiring process lasts three to six weeks, and if you don't have a dedicated HR professional (or team) doing this work, it'll be necessary to put other responsibilities on hold to do so.
To manage your time effectively in the process, create a hiring checklist to know precisely what you're looking for in a team member, and harness various platforms to source candidates (such as job sites and social media sources). And while process efficiency is important, by all means, also take your time finding the right person. It'll take longer and cost additional money and other resources in the long run if you rush.
Related: How to Create a Strategic Hiring Plan
2. Working too much
In the early days of operating my business, I'd regularly put in 70- to 80-hour workweeks. For many BIZ Experiencess, to be sure, there are times when life seems to be entirely on the clock — no vacation, no weekends and no hobbies. One striking statistic in the 2016 Annual Bank of the West Small Business Survey found that 43% of BIZ Experiencess cited "always being on the job" as their biggest challenge. For many, this brand of work ethic simply isn't sustainable, but there are several things you can do to help balance work and life:
• List those tasks that are both important and only you can do.
• For the remaining, delegate them to employees.
• Create a personal schedule of on and off time, and stick to it.
• Calendar it strategically, but take that vacation. Burnout will only make your company suffer.
• Automate as many tasks as possible.
I'm not suggesting that the above steps will be easy. After more than 30 years as an BIZ Experiences, I still eat, sleep and breathe my business. But I also automate as much as possible, create repeatable and sustainable processes and prioritize tasks religiously. And I do make time for vacation!
3. Handling payroll and other administrative tasks
When I started my first company, payroll was a constant and maddening thorn in my side until an idea struck me: I could start an accounting and payroll business to help the millions of others struggling with the same necessary but tedious tasks. Thus, Patriot Software was born.
If you are struggling in the same manner I was — not just with running payroll but keeping the books and managing other administrative (largely non-revenue-generating) duties, there are several ways to avoid getting bogged down:
• Use payroll services to handle associated calculations, tax filings and tax deposits.
• Work with an accountant to review books and help with financial decision-making.
• Take on an employee devoted to administrative tasks.
• Take a breath, even in times of being seemingly lost in details. Take it all one day at a time.
Related: How to Hire an Accountant
4. Matters outside of your control
Business owners who weathered the recent pandemic are a special breed — persevering in the face of unprecedented and ever-changing government mandates, supply chain shortages, inflation and radical fluctuations in consumer spending.
Covid-19 may be largely under control now, but it's an enduring reminder that there are highly variable outside forces to contend with when owning a business — natural disasters, recessions and many others.
Although you can't fully prepare for every eventuality, there are some actions you can take to help cushion potential blows. Two of the most vital are creating an emergency fund and conducting a strengths, weaknesses, opportunities and threats (SWOT) analysis to assess potentialities. Lastly, stay up-to-date on aid, such as tax relief and disaster loans, as it becomes available.
5. Financing
It will be no surprise to any reader that business financing challenges are common. Many startups fail simply because they run out of cash. Coming up with funding is stressful, but there are several avenues available to small businesses and nonprofits, including:
• Bank loans
• SBA loans
• Credit cards
• Investors (e.g., venture capitalists and angel investors)
• Crowdfunding
• Grants
In addition, you could ask family and friends or pull from personal funds, but it's beyond vital to weigh the benefits and risks (both financial and personal) of any source before diving in.
Related: How to Fund Your Business With Venture Capital
It's a tough job but worth it
Becoming an BIZ Experiences is no small feat. Yet despite the challenges, owners are taking the plunge more than ever, to the tune of no fewer than 472,961 business applications in September of 2023 alone (a new high, according to the U.S. Census Bureau) — enriching local communities and making their corner of the world a better place.
