Setting up a business is easier than it’s ever been. However, making the business a success and surviving past the first year can be extremely challenging. If you want to ensure that your new start-up thrives, you’re going to want to understand the challenges it’s going to face.
Here, we’ll look at three of the biggest challenges new businesses face during their first year of operation.
1. Attracting customers
When you’re just starting out, it’s down to you to bring in the customers. However, this isn’t always easy, particularly if you aren’t digitally savvy.
The majority of marketing in business today, is carried out online. This is where your customers hang out. So, you’re going to need to focus on things such as social media marketing and paid ads to reach your target audience.
Before you do this, it’s important to have a good understanding of your customers. Knowing who to target and where to target your ads will help you to generate a good level of customers.
Another major challenge start-ups have today, is the level of competition they’ll be facing. This is especially true for businesses in the online retail sector. With so many direct competitors out there, it’s going to be difficult to stand out and make your mark on the industry.
The best way to get around this challenge, is to research your competitors. Try and offer something they don’t. Or, if you can’t think of any additional products and services you could be offering, focus instead on creating a unique customer experience. That could be ensuring you’re providing exceptional customer service for example.
3. Financial struggles
Perhaps one of the biggest and most problematic challenges new businesses face, is cash flow. It’s easy to underestimate how much money you’ll need to start your business. You’re also going to need to factor in slow periods while you build up a customer base. This is where alternative finance such as a merchant cash advance can come in useful. Ensuring you have the funds to survive the first six months to a year, will help to enhance your chances of success.
The above are just three of the biggest challenges new businesses face in their first year. By understanding the challenges and taking steps to overcome them early on, it’s going to help increase the chances of succeeding past the first year.