Challenges of small business growth: be prepared

If you plan to grow your small business, you may face new challenges that can slow your progress. But if you’re aware of these potential roadblocks, you can prepare and overcome the challenges of small business growth to focus on your future. 

This guide will list challenges of small business growth, including: 

• Managing workload 
• Meeting new client’s needs 
• Maintaining your supply chain and inventory 
• Facing new competitors 
• Considering finances 

One of the key challenges of small business growth is managing your increasing workload. As you expand your operations, you will have to handle more clients, communications, and general obligations. These new tasks will take more time out of your day and may cause stress. As a result, you could struggle to achieve everything you need to. Meanwhile, too much stress can negatively impact your health. 

It can be difficult to establish a work-life balance as a business owner since you don’t have set hours. But, if you establish rules for yourself, such as not answering emails after seven, you can avoid taking on too much stress. 

On the other hand, to manage your increasing workload, consider improving your time management skills. You may want to use a business management tool such as Google Workspace that helps you organise your calendar, documents, and communications. 

You could also look into project management tools like Trello to increase productivity. Alternatively, you could outsource some of your operations, such as marketing, to take tasks off your place. 

A growing business likely means a larger client base and new products or services. A more diverse client base introduces new challenges because they’ll have unique and varied needs. It may be difficult to satisfy these clients and solve new problems. For example, say your graphic design business transitions from just logo services to designing entire websites. You’ll face new client challenges with the more extensive projects. 

To adjust to a broader client base, consider creating a new system for how you work with clients and complete projects. Altering or strengthening your operational process can help you predict and manage these new challenges. If you complete a large project the same way you would face a small one, it may become disorganised. So, reflect growth in your new process. 

On top of this, you may want to write up a new customer service policy. How will you meet the needs of your new clients? For example, you could introduce a FAQ page to your website. 

Aside from growing finances, if you create or sell products, you’ll need to consider managing your supply chain and inventory. As you make more products, you’ll need a steady supply of the necessary supplies. So, you’ll likely need to order supplies more often and calculate how much more frequently you’ll need them. 

On top of this, if you stock a shop, your growing inventory may be more difficult to keep up with. To solve this problem, you may want to find an inventory management tool that automates the process to save time and reminds you when to restock. 

New competitors are also a challenge to consider when growing your business. If you take on new services or start selling new products, your market will likely expand. These new offerings will bring you against new competition that offers similar products or services. 

To prepare for new competition, do competitors research before introducing these new products or services. The research will help you understand what new competitors you may face and how you can stand apart from them. 

Another major challenge of small business growth is organising your finances. Financial accounting can be difficult to maintain for any business, but you’ll need to focus on it more closely as you grow. It’s crucial to know how much you spend on your growth and how that investment translates to profit. Plus, if you took out a loan or secured funding from investors, tracking your financial results is even more critical.

As you deal with larger amounts of money, you’ll need to track your business’s cash flow. The cash flow, or money exiting and entering your business over a given time, will help you cover growing business expenses. Be sure to create a new budget for your business based on it’s growth. 

Then, if you haven’t already, open a business current account to separate your business finances from your personal ones. With a bank account specifically for your business, you can avoid mixing up business transactions with personal ones. You may also want to look for an accountant to help you maintain accurate records. Then, you’ll need the right accounting tool to simplify the process. 

Financial management can be stressful and time-consuming when you run a business, let alone grow that business. That’s why you need an accounting tool to stay on top of your growing finances, like Countingup, which thousands of business owners make their financial admin easier. 

Countingup is the business current account with built-in accounting software that allows you to manage all your financial data in one place. With automatic expense categorisation, you can track and find your business expenses using HMRC approved labels. Then, the receipt capture tool will remind you to snap a picture of your receipt when you purchase. These features simplify your accounting process and save you time as you grow your business.  

Plus, the app generates cash flow insights to stay on top of how much you spend and earn. Countingup even offers year-round tax estimates to prepare you for this growing expense as your income grows. With these tools, you can confidently keep on top of your growing business finances wherever you are. 

You can also share your bookkeeping with your accountant instantly without worrying about duplication errors, data lags or inaccuracies. Seamless, simple, and straightforward! 

Start your three-month free trial today. 

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