Running a small business is tough. You don’t have the financial clout of a larger organization, and your team is likely still too small for you to step back and hand over the daily running of the business to anyone else. This means you are far more engrossed with minor obstacles than most large business owners – who instead focus on longer-term targets and more macro challenges.
Although this can be a positive aspect of running a small business (having a thorough understanding of your internal processes and the skills necessary to perform them allows you to recruit and manage your team effectively and spot potential inefficiencies more quickly), it can also be a drawback.
The intensity of running a small business means you can often ignore impending issues until it is too late. To help give you a stronger understanding of the unexpected problems that could crop up and impact your company, here are three hidden challenges to prepare for when running a small business:
You May Have A Legal Challenge
Sadly, a legal case is one of the most common challenges you may face as a small business owner. Although this could just as easily happen to a larger organization, they are also likely to have an army of lawyers at their disposal and deep pockets to burn as cases make their way through the judicial system.
Regardless of how innocent and law-abiding you believe your company to be, there is always the chance that one of your products malfunctions or an incident takes place on your premises that you could be liable for.
Lack Of Insurance
Therefore, you need to be prepared for any possible eventuality with proper insurance coverage. Many business insurance policies and legal services are designed to help support a company during financial, reputational, and legal troubles, which may stem from all kinds of problems – be it a client or employee suffering an accident or incident in the workplace or liability resulting from a product or service you sold, as two common examples.
Say, for example, you own a law firm. In that case, finding appropriate legal services insurance online to cover your company is crucial; it should be part of your fundamental business practices to ensure safety and longevity – not to mention peace of mind for you, the small business owner. By acquiring the right legal services insurance, you won’t be leaving yourself and your law firm open to a draining legal case – perhaps stemming from customer or employee injury at the office, accusations of legal mishaps from a client, or any other incident or problem that could cost your company a vast amount of money and hassle to deal with – as well as possible damage to reputation that could prove to be a PR nightmare.
You May Struggle To Stand Out In The Marketplace
Another problem that your small business might suffer from is its position in the marketplace. As larger competitors threaten to monopolise the industry, it can be difficult to make your voice heard – especially if your marketing budget is limited and you cannot provide as many products or services. It can be easy to become dispirited when this happens because there appears to be little way to compete. When faced with this problem, there are two key points to remember.
Firstly, you don’t need to compete with huge corporations to generate vast money and build a profitable small business. By chasing giants, you are always going to come up short. This leads on to the second point, which is that you can use your lack of size to your advantage. Being smaller means you are more agile, can take more risks with your products and marketing, and can provide more memorable customer service.
The Economy Could Change The Behavior Of Your Target Market
Lastly, when you run a small business, you are more exposed to the changing tides of the global economy than if you had billions of dollars at your disposal. Your supply chain and overheads will likely be far more sensitive to market downturns, and your cash flow could be threatened by a dwindling group of customers during tough economic times. Bear this in mind and try your hardest to put away money for when cash flow decreases and you need to make up the difference.