5 Common Issues That Small Business Owners Face
Posted by Steve Strauss in General Business on Sep 25, 2012 9:03:57 AM
In the 1950s, Ray Kroc was just a milkshake mixer salesman, when one day while making the rounds he came across a restaurant owned by Richard and Maurice McDonald. Kroc was not only amazed by how few items the restaurant sold and how clean it Steve-Strauss–in-article-Medium.pngwas, but also by how efficiently it was run. He convinced the brothers to make him their agent for the restaurant and within a few years, he bought them out completely and had the dream of taking the concept coast-to-coast.
Here, though, Kroc ran into a problem. He needed a way to make it possible for the restaurant to stay successful even when operating in another place, where the support and resources available might be different or even nonexistent. His solution? Turn the business into a franchise. That is, replicate exactly how the brothers had run their successful restaurant and make the same support and resources available to the entire line of businesses.
Kroc coined a phrase to explain the concept: “In business for yourself, but not by yourself.” The idea is that with franchising, you not only are buying a system and brand, but also a built-in team to help you so that you don’t have to do everything alone. Ray Kroc hoped to show potential franchisees that by working with him and by becoming a McDonald’s franchisee, their path to small business success would be easier.
Small business owners, no matter the industry, have faced and will always face common issues. After all, while flipping burgers is different than, say, selling flowers, both businesses still require that the owner deal with taxes, handle employees, get customers, etc. They are not that dissimilar. And becoming part of a franchise might not always be the best solution to a problem – it’s just one of the many creative ways to look at solving any of the common issues for small business owners.
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Here are five common issues that all small business owners face:
1. Getting the help they need: The two complaints that I hear most often from other small business owners are “not enough time” and ”not enough money.” Not surprisingly, the issues are tied to one another.
A lack of extra capital means that many small business owners do too much themselves. Not only does that result in the ”not enough time” conundrum, but ironically, it reinforces the ”not enough money” one too. The fact is, you can really only grow your business by spending the dough to bring in the help you need. That will create an alternate cycle where (hopefully) you can make more money and thus bring in even more help.
2. The cash crunch: A declaration of “not enough money” oftentimes means there is a cash crunch, and there are all kinds of reasons for them. You might own a seasonal business that makes very little revenue at some points of the year. You might need to spend unexpectedly to upgrade equipment. Whatever the reason, there are a few smart ways to deal with this problem:
Budget better: If you know you are always extra busy around the holidays, then you simply must make that money last all year long.
Create additional profit centers: Again, if you’re a holiday seasonal business, figure out a way to make money during the summer as well as in December.
Get a loan or line of credit: Educate yourself on the best avenues to new capital. Take advantage of the financial institutions that are in business to help you get the capital you need.
3. Challenging clients: Back when I practiced law, we had a saying that we thought was clever but is probably said by many in a client service business: “It would be a great business,” we would joke, “if it weren’t for the clients.”
Look, we all have them – problem clients. The question really is, what do you do about them? One school of thought is simply to tolerate them, and that makes sense, especially if they are an important client. However, sometimes, when the bad client goes from challenging to a real distraction from other important things, the only thing to do is to cut them loose.
4. Recruiting and retaining top talent: One thing the best business owners know is that they are only as good as their people. The challenge for the small businessperson is that keeping great talent around can be tough when budgets don’t always allow for big raises. The trick then is to find out what your best people need and give that to them, whether it be recognition, training, a better title, an opportunity to try something new, or room for advancement.
For more, http://smallbusinessonlinecommunity.bankofamerica.com/community/running-your-business/generalbusiness/blog/2012/09/25/5-common-issues-that-small-business-owners-face