Challenges Facing Entrepreneurs. Entrepreneurs encounter many challenges in today’s competitive business world. In this article, I thought I would discuss a couple of common challenges.
- Cash Flow Management
- Hiring Employees
Challenges Facing Entrepreneurs.
Cash flow management
For small businesses to survive, cash flow is very essential, but a lot of entrepreneurs are seen struggling with bills while waiting for the checks to arrive. This problem starts when your customers delay paying the invoices that you send them. Payment delays are common in the entrepreneur world. You carry out a job and send out the invoice, and then wait to get paid. While waiting, you have to pay all the other bills that come your way. Your company is small, and if you get a reputation for not paying on time, you may have trouble with your suppliers. This cash flow balance is essential to small business survival, yet many entrepreneurs struggle to pay the bills (let alone themselves) while they’re waiting for checks to arrive. The solution to this is planning and proper budgeting; these two are critical to maintaining cash flow. One way to improve cash flow is to demand a down payment for your products and services. The down payments should cover all expenses associated with the project at hand. This payment will help to tend to every other need that arises.
The second technique is to negotiate a payment discount right into the original contract. Most customers ask for a discount at some point in the negotiations. It is important to a small business owner that you take advantage of this and use payment terms as one of the terms. If the customer is unwilling to be flexible, you need to make sure that you “run the numbers” and decide if you should walk away from the order.
Another technique is to break the order up into smaller deliverables or milestones, each associated with a fractional payment .
The second of the “Challenges Facing Entrepreneurs.” Many Entrepreneurs dread job interviews even more than the prospective candidates themselves. The hiring process takes several days; there are resumes to review and interviews to hold, all to help you get going through unqualified candidates looking for the qualified ones. After this, you are left with creating and then offering your employment package that, in many cases, pales in comparison to what is being offered by larger more established firms.
The solution to this is to deploy a targeted approach to sourcing candidates the same way you would approach a customer marketing campaign. This will save you a lot of time by pre-qualifying candidates. Using exclusive help wanted ads that are specific as to what it takes “Make it” at your firm will help filter out many candidates. Many people will self-select out of the process before they even send a resume. You can even include details about what it is like to work at your firm on a daily basis.
Once a candidate expresses interest in your firm, arrange for a walking interview in which the candidates are taken on a tour of their working environments. Ask them questions that are in line with the job; candidates experience and long-term goals. Don’t act like an overlord, behave like you are seeking out a partner. Also, take the time to seek out real references and who can attest to their work potential. Many candidates offer up neighbors and family member as references. Once you have picked a candidate, ask them what it will take to keep them employed with you.
During the interview process make sure to explain to the candidates your vision and values. The solution is to find good employees who have similar values as you. Eventually, you will need to delegate tasks to them, and you need to be confident that they will approach tasks from a similar perspective as you. They may never be able to match your understanding of the task, but it would be great if you can identify people that can share your passion.