While the business world of today is highly competitive, more entrepreneurs means more resources to help you get started. If you’re contemplating starting your own business, or you’ve already started one and you’re struggling, here’s how to deal with the most common challenges.
Managing Your Cash Flow
Paying the bills and paying yourself can be a struggle when you first start out, as you’re likely living paycheck to paycheck. This problem stems from delayed invoicing, which is incredibly common in any industry. You provide your service, you send an invoice, and you get paid 30 days later—if they pay on time. In the meantime, you’re paying your employees, contractors, landlord and everything else in between. A customer who takes their sweet time paying you could ruin your business.
Proper budgeting and planning are critical to avoiding this issue, but even the most detailed and careful plan can’t fully protect you. If you’re having problems getting your money when you need it, consider asking your customers for a down payment for your services. Whatever amount you request, it should cover all of the expenses associated with your product or services, as well as a little profit for you. This way, you can at least rest assured that you’ll have some padding in case they don’t pay on time.
Another thing you could try is adjusting your invoice time. You can ask that your clients pay you within 15 days instead of the typical 30—so if they’re late, you have extra time built in to figure things out before it becomes a problem. More and more companies are starting to require immediate payment, and with your customers ability to pay right from their phones, this isn’t an entirely unreasonable request.
This may come as a surprise—if you know, you know—but no one dreads a job interview more than the interviewer. Established entrepreneurs can tell you: the hiring process is a lengthy one that requires a lot of thought and energy. Reviewing resumes, sitting through interviews, and sifting through stack after stack of unqualified candidates can be seriously draining. Then if you find the right person, you have to create an offer they can’t refuse but that won’t put you out of business.
The key to streamlining this process is to be exclusive. Be as specific as you possibly can with your job description, and don’t be afraid of alienating people—that’s what you want. A detailed ad will screen unqualified applicants for you. Let them know what you expect of them, as well as what their day-to-day workload will look like. Basically, approach your job hunt like you would your marketing campaign—excellent targeting. You can save yourself a lot of time and hard work by being direct and specific from the get go.
While this will save you time in the long run, don’t skimp on the references—invest some time into seeking real references. Don’t settle for a family friend, seek out people who can actually account for a candidate’s work ethic and professional potential. When you’re interviewing them, ask them specific questions about their long term goals and what they’re expecting from the job. Employees who know what to expect will stick around longer than those who don’t have much direction.
As an entrepreneur, you hold many titles. Accountant, PR person, social media specialist, head of human resources—the list goes on. Because of this, time management is one of the most pervasive problems you’ll face. There simply isn’t enough time in the day to get everything done.
The solution here is to make time, not by waving a magic wand, but by being intentional and efficient with the time you do have. Start off by creating lists. List all of your overarching goals—the ones that you know will take years to achieve. Then break those down into yearly goals. Break the yearly goals into monthly goals, then into weekly goals, and finally into daily goals. Keeping your overall vision on your mind when drafting your daily goals will help you stay productive, motivated and excited. The little tasks by themselves may start to feel tedious, and huge abstract goals by themselves can be overwhelming. The key is understanding how the little tasks fit into the overall goals.
If any tasks on your daily list don’t work with your overall goals, cross them out. If any tasks don’t necessarily have to be done by you, delegate them to someone else. Ask yourself often, “Is what I’m doing right now the most productive use of my time?” and go from there.
Once you make your lists and analyze them, you’ll probably find that a lot of things don’t absolutely have to be done by you. The next step is to task those out to other people so you can focus on more important things. This is a tough one—relinquishing control of certain aspects of your dream can be very frightening, and maybe you’ve found that when you try to delegate things get messed up and you have to fix them anyway. The key is to delegate well.
The first step to this is, of course, to hire great employees or to outsource help. These things can be more expensive but will save you in multiple areas later. Be extremely specific when delegating to these people. This will take time, too but will be so much better in the long run. Treat the person you’re delegating to like they can’t think for themselves—they can, of course, but before they get to know you, they’ll be more likely to take everything literally. There’s a larger chance they’ll skip steps that you don’t mention, even if they seem obvious to you. Instead of telling someone to create an inventory list in a spreadsheet, tell them to list every store item alphabetically in the left column, with each quantity in the column next to it. It’ll seem like overkill, but will save you a lot of time later. Plus, your loyal employees will get to know you and how your mind works—eventually you don’t have to be so detailed with them
Marketing is an ever-changing beast, and you may not know where to start. There are a lot of different marketing avenues you can take, and if you aren’t sure what’s effective and what isn’t, you should acknowledge this. With marketing, and really with any area of business you aren’t confident in, you should consult someone outside the business.
In the early stages of your business, the only thing you really need is a core marketing plan. You need your core values and overall marketing objectives, including the marketing services you’ll undertake in order to motivate potential customers to become actual customers. Give your marketing planner or consultant a budget and have them craft a plan for you!
This is not at all the time for experimenting—starting out, you need every cent to work as hard as possible for you. Save your experimenting for later down the road when you have an established customer base. Focus for now on a precise, effective marketing plan to get you going.
The life of an entrepreneur is extremely rewarding, but you certainly work for every little reward you get. It can be really easy to get discouraged at the beginning, or whenever something goes wrong or isn’t meeting your expectations. Essentially, at some point and probably multiple points after, self-doubt will creep in and you’ll be tempted to throw in the towel.
Being able to overcome self-doubt is an essential part of entrepreneurship, and although it may take some time, it will get easier. Surrounding yourself with supportive friends, family and mentors who know your business goals will make all the difference in the world. Connecting with other entrepreneurs who relate directly to your struggles and can give you advice and wisdom will go a long way too.
One of the most effective ways to overcome self-doubt is to put your head down and just keep going. Work on your goals and your task lists, and remember why you’re doing what you’re doing. When you’re actively contributing to your lifetime goals, even in small ways, you’ll feel productive. Even if it’s one step a day, it’s a step closer to your goals. You just have to keep going!
For advice and support from other entrepreneur’s like you, contact the Entrepreneur’s Organization of Birmingham today.