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How to deal with most common problems new businesses face

Starting a business is never as simple as it may sound. As a matter of fact, every entrepreneur that decides to set off in this venture should prepare to face various challenges and obstacles along the way. Surviving the first year on the market is arguably the most difficult challenge in entrepreneurship, especially if you're not adequately prepared. However, around 80% of new businesses survive their first year, but more than 50% of new businesses fail in first four years.

The main reason is that entrepreneurs usually feel overconfident and have a tendency to neglect or avoid certain challenges along the way, believing if they rush and make it to the market; the problems will sort themselves out. Unfortunately, avoiding problems won't make them go away. Instead, they'll just pile up and turn into even bigger issues. Here are a few most common problems new businesses face.

1

Do proper research

Market research is one of the most essential steps when starting a new business. If you fail to conduct proper research, you have little to no chance of reaching success. Thorough research allows you to identify your target audience and their needs, preferences and demands. That way, you'll know how to position your business to deliver on those needs and demands.

Also, market research allows you to identify new opportunities and find ways to solve your business problems. In addition, it will help you find out who your main competitors are and give you insight into how they do business, so that you can find a way to outrun them. Many entrepreneurs think research is unimportant and a waste of time but, in truth, this step is invaluable both to you and your business.

2

Don't let the lack of the experience get you down

Experience is essential in the business world. It allows you to make the right decisions and spot the right opportunities. However, many new entrepreneurs lack the valuable experience and often make the wrong decisions. This leads to taking advice from wrong people, making bad calls or signing the wrong agreements. If you lack the experience, then you should make decisions on an impulse. Instead, take time to look at all your options and seek advice from multiple sources before you make up your mind.

If you find yourself in an inconvenient situation, act upon it immediately before the damage is irreversible. For instance, you may sign an agreement contract with a supplier without reading it first, because the deal was really good, only to find out that what you signed isn't the same as what you were promised. In that case, experts such as Bordas & Bordas consumer fraud lawyers can help you get out of deceptive contract agreements.

3

Prepare enough funds

Most new businesses are funded by the owners but, unless you have enough, you'll need to either borrow cash or seek outside investments. Funding a business requires a well-planned budget and if you fail at this task, you'll be closing down shop real soon. Business activities, such as building a minimal viable product (MVP), creating a marketing campaign, promotions and designing a website require the most funding.

However, there are hidden costs that a lot of new business owners aren't even aware of, such as taxation based on the business structure, licenses, permits and insurances. Starting a new business without proper resources, means that you won't stay in business for too long. That's why you need to make sure you have enough capital and calculate the budget accordingly. That way, you can cover the expenses required to run a business.

Further information

New business owners are facing various problems and difficulties on daily basis. However, if you take time to analyze the situation, you'll definitely find the right solution. It's important to remember that business success isn't determined by how fast you can push forward. Instead, it's determined by how patient you can be to take things one step at the time and avoid making crucial mistakes.

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Page last edited Nov 24, 2017 History

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