2019 will soon be here with us and at the moment, most of us are busy drafting resolutions on what to do next year. Most people want to finally start their own businesses which is indeed a great thing. However, after studying so many startups and having started one some years ago, I want to explore the four key challenges that every entrepreneur running a startup has to be ready to battle with. For every challenge, we will also be looking at how to beat them.
Product and its market
An entrepreneur needs to identify the product that they want to deal in and once they have done so, they should then go ahead and identify the market for the product. Why so many startups fail is because the people who start them do not know what product is right for a certain market. They therefore fail miserably because there is no demand for their products. A solution for this is working with data and researching through interviews, use of questionnaires so that you know whether your product is in demand and then you can go ahead to sell it. Research is expensive but you can liaise with local authorities and ask what research they have done on the same.
Hiring and firing
The reason why we look up to successful businesses such as Amazon, Google, Facebook is because they hire and fire right. They are able to have a competitive system of getting talent and once they find that the people are not fit, they fire them immediately. Most startups have a challenge learning whom to hire and also when to fire their staff.
When most startups begin their operations, they find that their clients are not paying in good time and also that their employees, suppliers are demanding money even when the business has nothing. In order to move things ahead, the entrepreneur finds that they have to take a loan and then pay later when their clients hands in the cheque. However, most financial institutions would not be ready to lend them a loan because, well, they do not have a good credit history. This tends to make the entrepreneur stressed and unable to decide on what to do next. Well, it needs not be that hard. They can always go to financial institutions that give business loans for bad credit where they will not be required to present their FICO scores report or anything that shows they have a great credit history.
If the business has identified the right product with a good target market, has the right staff and has been able to manage their cashflows, they find that they have to battle with stiff competition from other business that mushroom. To deal with this, the entrepreneur should be ready for this and have a competitive advantage over everyone else.