What Are Threats That Small Businesses Often Overlook?
A small business faces many difficulties that its larger counterparts may be able to bypass with a sizable investment. Still, the greatest threat doesn’t come from the places you expect it to come from. Your competitors may try to use some foul tactics to slander your brand, yet, this is something you’re probably prepared for. Your audience may be suspicious towards the offer you present them with, yet, this too, is something you should already have a plan for. The thing is that the greatest problems come from where you least expect them; here are five such examples.
Putting all your eggs in one basket
First of all, it seems natural, even intuitive to put all your hopes in a single, most profitable service/product. However, what happens if this product fails to resound as strongly as you thought it would? Where do you go from there? This is why it’s a bad idea to put all your eggs in one basket. Try to diversify your products, diversify your investments and create an additional stream of revenue that you can fall back on if the situation appears to be too grim.
Over-investing
Warren Buffett once said that if you start buying things you don’t need, you’ll soon be forced to sell things you do need. In other words, over-investing can be incredibly dangerous for a small business, even though on paper, it’s supposed to save you money in the long run. This long-run mentality is the bane of small businesses, seeing as how they invest in trends that will pay themselves off in 10 years, while 90 percent of small businesses fail within the first five years of their existence (most of them fail during the first year). By spending work capital on long-term investments, you’re seriously endangering your cash flow. In other words, do this only when absolutely necessary.
Ignoring the security of your headquarters
Small business owners are so preoccupied with the issue of cyber-security, that they often forget to physically protect their premises. Installing a smart lock, a surveillance system and a reliable fence are just some of the trends you need to implement. Moreover, the risk of employee-theft can be just as great, which means that ensuring the security of your headquarters needs to start from within. Latest video management system provides the ability to deploy a surveillance that can truly support business needs.
Taking unnecessary risks
If your company is on the right path, the last thing you need is an unnecessary risk. Sure, a threat can also be an opportunity, however, expecting an overnight success is not the mindset of an entrepreneur but the one of a gambler. Entering a venture without proper research is not unlike picking a number on the roulette wheel and hoping for the best, which is why it is to be avoided at all times. Instead, take a more careful approach and be content with the fact that your revenue, workload and business are gradually increasing, even if it takes years and decades for them to meet your initial goals.
Teaming up with the wrong people
Lastly, not a lot of people can start a business on their own. We’re not just talking about the finances but the administrative part of running a business, as well. Now imagine if one-half of your company decided that the direction you set isn’t necessarily the best one out there. What if they decided to start dragging your business in a different direction? Teaming up with the wrong people can spell doom for your company, which is why you need to keep both of your eyes open when picking partners, managers and even employees.
As you can see, threats come from the most unlikely of fields and while some may pose an immediate threat to your brand, others might take years to manifest themselves. Sadly, when it comes to fragile small businesses and startups, they all lead to inevitable failure. Therefore, understanding, recognizing and fighting them efficiently needs to become the ultimate goal of every entrepreneur.
Author Bio:
Diana Smith is a full time mom of two beautiful girls interested in topics related to finances and latest business technologies. In her free time she enjoys exercising and preparing healthy meals for her family.
Any questions or comments? Let us know!