The top 5 challenges small businesses are facing in 2019
The number of self-employed people in the UK has skyrocketed to an impressive 4.8 million since 2001.
With the potential to benefit from a better work-life balance and the sky being the limit when it comes to earnings, it’s not surprising that entrepreneurs now make up 15% of the working population.
While there are some fabulous benefits of being self-employed, there are of course challenges too.
I’m sorry, I hate to mention it (so let’s get it out the way first), but right now the pressing issue on most small business owners’ minds is of course Brexit.
It’s hard to believe that the referendum took place more than three years ago and we’re still none the wiser what’s going to happen. Perhaps this is why 45% of UK businesses say that Brexit is impacting their confidence which is in turn, affecting their business.
We’re still not sure if it will be a no-deal Brexit or not which means businesses don’t even know what they should be getting ready for. This doesn’t mean that you can prepare however. If you do trade with other organisations in the EU, it’s a good idea to at least make yourself aware of how you may be affected. Sage has put together a great article, ‘What will the impact of Brexit on small businesses be?’
Cash flow is important for any business but SMEs in particular are likely to feel the pinch when times are tough or when clients aren’t paying up on time.
The issue of late payments is one that’s sadly, incredibly prevalent in Britain and it’s costing small business owners an eye-watering £6.7 billion a year.
With 92% of business owners saying they’ve experienced cash flow problems from time to time or consistently, how can you stay on top of your finances?
· Put payment terms on your invoices. For example, if you expect payment within 30 days, state this clearly.
· Put aside money for tax every month. HMRC has a self-employed ready reckoner tool which will give you an estimate of how much income tax and National Insurance you’ll have to pay.
· Keep an eye on your cash flow weekly or even daily. Burying your head in the sand will only lead to serious problems later down the line.
· Sure it’s an added expense but it’s well worth investing in an accountant. A good accountant can save you a lot more money than they cost.
Even the biggest, most successful companies have people working every single day to find new customers and this is something that’s even more important for small businesses who aren’t a household name. Granted, it’s not easy.
Start by identifying who your ideal customer is. It’s unlikely you have the time, the resources or the inclination to reach out to everybody so you need to make sure you’re spreading the word to the right people.
Once you know who you’re trying to target, think about what your customers do and where they spend their time online. Creating specific buyer personas (you can download a free template here) allows you to create content and get in front of your target customers with the messages they care about.
Good employees are key to successful growth so it’s natural that when you’ve got them, you’re going to want to keep them.
A report published last year however, revealed that two-thirds (67%) of SMEs have problems with recruitment and staff turnover. This means that 3.82 million small and medium sized businesses across the UK are finding it difficult to hire good quality candidates or retain existing talent.
It’s a job seeker’s market out there and this is a trend which looks set to continue over the coming years so now is the time to ensure your team is happy and motivated. From your recruitment and induction processes to training and development and the benefits you offer, you need to make sure you’re investing in your people if you want to keep them.
Managing your work-life balance can be particularly difficult when you’re self-employed. I’ve spent many late nights and weekends sat at my desk thinking, ‘oh the irony’ because I set up my own business to get a better work-life balance.
The truth is, there are going to be times when you need to put in the extra hours but it shouldn’t be all the time. If you’re permanently chained to your desk, ask yourself:
· Do I really have to get this done today or can it wait until tomorrow?
· Is it time to hire someone?
· If you already have employees, are you being too hands on? Delegate what you can so you can focus on other aspects of growing your business.
· Is there anything I can outsource to a freelancer? (Perhaps a copywriter for example?)
What aspect of running a business keeps you up at night? Or perhaps you’ve had challenges in the past you’ve managed to overcome? I’d love to hear your thoughts below.