Risk Management For Small Business Owners: Fill & Download for Free

In most economies small businesses are key drivers for growth and employ a large number of the working force. They are defined as small due to their revenue size and workforce. Setting up a small business is not that complicated as long as you have the right idea to meet your customers’ needs.Confusion occurs as to whether a small business owner can also be called an entrepreneur.Entrepreneurs have big ideas that look almost impossible to achieveThis I believe is what clearly differentiates a small business owner from an entrepreneur. Most small business owners goal is to feed their families and get by in life. The business owner probably loves what they do and you will find them carrying out a variety of roles in the organization – accountant, HR Manager, sales and marketing. Entrepreneurs on the other hand dream big. Their ultimate vision is probably to be as large as companies on the S & P 500. Most of their ideas sound crazy and impossible to achieve.When starting out most of the entrepreneurs will have ideas that are so big that even they do not believe in how they are going to come true. In this regards, think Netflix, Facebook or Elon Musk Tesla. Small business owners are comfortable to meet a need in society.Entrepreneurs have a capacity to take on more riskSmall business owners are not big risk takers. At the end of the day, the goal is survival. If they can meet their end of the day sales target then they are fine. Entrepreneurs can be differentiated by their capacity to take risks. They live on the edge, risking all their capital and time just to see their idea grow.Lack of scalability by small business ownerThe lack of a large vision means that the small business owner will not scale as fast as expected. Small business owners lack the ability to let go of their businesses and bringing in experts. They want total control of all operations. This limitation leads to most of them remaining the same year in year out. Entrepreneurs are driven by big ideas and as such are more open to bringing in experts, angel investors and venture capitalists on board.

Credit: ImageThe top 10 challenges faced daily by small business owners are as follows:The problem of FundsGenerally, small business owners do not have adequate funds to run his or her business and thus faces the problem of funds on a regular basis.The Problem of ManagementSmall business owners manage their business on their own and thus sometimes they do not have the efficiency of managing the daily affairs of business single-handedly.Improper MarketingSmall business owners neither have the funds nor the expertise to do marketing in a proper way and spread the business to the maximum number of people.Identifying Customer NeedsDue to inadequate research and poor understanding, small business owners fail to identify the need of the customers and struggle to deal with them.Lack of ExpertiseAs a small business owner, you cannot hire specialized people for all your operations, marketing, and other business needs and thus you lack in the expertise required to run your day to day business activity.Competition from Other Business GiantsSmall business owners are always at the risk of fierce competition from other big companies or industrial giants and sometime may not able to survive it.Lack of Branding & PromotionSmall business owners fail to make proper promotion and branding of their business and as a result, they are not able to create a good reputation in the market and ends up having fewer customers.No Research & DevelopmentAs small businesses do not have adequate funds they cannot invest in the research and development of new products and stick to the outdated ones.Lack of FlexibilitySmall businesses generally stick to the age-old business model and they are not flexible in nature. As a result, they lose business and foothold in the market.Debt ProblemAs small business owners lack funds required to run the day to day business activities they tent to take too much loan and get debt-ridden in the process.Hope it helps,OKportal Technology

There are a lot of problems faced by small business owners while managing their business. To start a business with all the risk is not a simple task.Here are some of the common challenges faced by the small or startup businessCashflow Management - A smooth financial flow in the business commits the growth of business in a substantial manner. But, inappropriate cash flow management can affect the business financial cycle Hence, understanding of cash requirements, in flow and out flow is important.Low Productivity - Good productivity means good business. It is essential to optimize the available resources to produce quality goods that can lead the business towards effective productivity and increase the business value.Poor Connections – For every small or startup business, making the valuable connection is essential. It can be used for marketing, investments, finance and a lot others that can help the startup business in some or the other way.Poor Experience and Skills - Nobody is perfect, hence it is important to upgrade the production methodologies consistently in order to understand the competitors, target market, business trends, branding etc.Inaccurate Financial and accounting management - One of the vital part in small business, is the practice of accounting it is a pillar in every business, any business growth cycle. Small business accounting should be streamlined to manage the balance in between investments and revenue.Time management - Time is money, especially in small or start-up business it is counted at the growth level. A scheduled picture of "what to do and when to do" makes easier to process the production without any loss. The effective time management can be the turning point of business for profitability.