The life of an entrepreneur may be fraught with challenges, but that doesn’t mean that you can’t overcome them with the right approach, the right frame of mind and the right guidance.

There is undoubtedly something exciting about starting up a new business. However, regardless of whether this is your first attempt at entrepreneurship, or you have been here before, you will soon find that this excitement can dissipate as the realities of running a start-up or small business start to hit home.

According to the stats, 20% of small businesses would fail in their first year of establishment. It is a shame and got us to wonder what would happen if the company directors chose to tackle the issues that they were grappling with early on and sought the right help, would it make a difference?

At Berley, our small business accountants have spent years helping entrepreneurs in London overcome challenges, achieve their goals and, most importantly, grow their businesses into revenue-generating machines. In our 30 years of existence, we have seen all of the challenges that entrepreneurs face and we have come up with strategies to counteract these obstacles. In this article, we aim to share a few of the most common challenges that you may face (or have faced) as an entrepreneur.

Don’t let a poor business plan let you down

It takes more than a great idea to guarantee success. One of the basics behind the success of many businesses is how seriously their directors take their business plans. While some view a plan as a chore that offers little in the way of rewards, we don’t agree with that assessment. Not only will a business plan help to outline your business and its activities, but it can also be absolutely vital in securing funding. As such, a business plan needs to be excellent throughout and it most certainly should not be treated with contempt.

A business plan helps to test whether an idea really works when the numbers are broken down. It can also be a very helpful process if you find that you are a more of an ‘ideas’ person rather than someone who focuses on practical solutions. It can force you to step outside of your comfort side and throw your ideas at the wall to see if they really stick. Essentially, crafting an excellent business plan that works can help you build the discipline required to make it as an entrepreneur in both the short-term and long-term.

Additionally, no serious lender or investor is going to give you attention if you don’t spend time crafting a worthwhile, thorough business plan that outlines the financial details surrounding your business. At Berley, our experienced small business accountants often help our new clients with their business plan to make it more impactful, focused and lender-friendly.

Bad time management is costly

In the early days of a start-up or small business, owners tend to take on a lot of responsibility. Whether it is as a result of financial constraint, or an inability to ‘let go’ of control over their pet project, many start-up directors play multiple roles – accountant, sales team, operations manager, marketing director, graphic designer, web developer, janitor or even painter and decorator, to name but a few. While you may think that it is necessary to take on all, it can lead to bad time management habits if you are not careful. For instance, you may find yourself getting lost in the detail or even drawing up a blank at key moments as a result of the sheer mental exhaustion of wearing too many ‘hats’.

There are quite a few apps and planners which can help you on a personal basis to organise your time effectively and ensure you meet your own goals and objectives. If you cannot afford to hire a team, then outsource what you can. For example, bookkeeping is ‘such a thankless task’ as one of our clients puts it, especially when you don’t have experience in this field. Outsource your bookkeeping work to Berley, for instance, is highly cost-effective, as we take care of the administrative tasks while leaving you to focus on running your business.

Good time management is the key to being a successful entrepreneur, being more productive and having a better work-life balance.

Control rising costs

Every entrepreneur faces the challenge of costs. Things can start to add up as legal fees, rent, business registration fees, marketing, recruitment, utility bills, office supplies, inventory and stock management (to name but a few) begin to add up. This can be further compounded by changes to the economy that can unsettle your best-laid plans.

Ultimately, there are many costs that, if not properly managed and planned for, can prove to be fatal to a business. Whether the challenge of the costs was within or outside of your sphere of control, the struggle to keep your business afloat is the same. You may be tempted to find new clients or new investment to solve the problem but this can end up compounding the problem in the long-term – sending your business plummeting into a downward spiral from which there is no return. Thankfully, it need not have to be that way.

Here is the thing, every business has to deal with expenditure and rising costs and it comes down to working smarter with what you have got. In the article “5 ways to manage rising business costs”, we discuss in detail the five useful tips that can assist you with gaining control of your finances; give it a read if you like.

Examine your price structure

When it comes to generating revenue, you may want to re-assess how much you are charging clients and what value you are offering for that money. To do this you may want to examine how you frame your products and/or services, the way you present them and the value that they offer to your clients. One way to show value to clients is by better demonstrating the work that you are doing to make their lives easier.

Keep in mind that there is always someone out there offering cheaper prices than your business, so compete on price alone will not win. Focus on what value you can provide to your customers instead. In fact, you may be surprised by how much people value, for example, good customer service and friendly relations over the small savings offered by a competitor.

Hire the wrong people

The people whom you choose to work with can be a key component in determining if your business sinks or swims. When you hire the wrong people for the job, you can end up paying for that costly mistake. It is important to view recruitment as an investment. Think of it this way, in no other area of your business would you knowingly make poor investments, so don’t just view your recruits as automatons who can be replaced – look for people who offer distinct, individual sets of skills and traits. To ensure the success of your business, you need to hire quality people who have the right skills and temperament for the job. Don’t be afraid to try out interns or apprentices also. Many interns and apprentices are eager to apply their skillsets and have the dedication, determination and youthful energy to invest in your business and its vision.

Another excellent strategy is to look at alternative forms of employment. For example, contractors and freelancers can be employed as and when they are needed to complete projects without the additional overheads that come from permanent employment. If you would like to know more about different employment options and the 7C’s recruitment system, follow the link to this article “The hiring dilemma”.

Fail to stay on top of tax and financial affairs

There is no doubt that many business owners can be left absolutely overwhelmed by both their tax obligations and their financial situation. In fact, a recent poll of businesses by accountancy software firm Xero found that 77% of small business owners felt overwhelmed by the regulations on taxation, 54% had never submitted a tax return and 23% admitted to being fined because of an error when filing their taxes. From a financial perspective, 85% had less than one day of business education or financial education when starting their business.

This is why it is so important to hire an accountant to help you keep on top of finance and tax matters. While you may be tempted by the prospect of saving money, is the wasted time and effort worth it if you end up with a fine? Or is that energy better spent on improving your business and enabling growth? Our small business accountants at Berley can help you with all matters relating to tax and finance, ensuring that your financial requirements and bookkeeping are kept in check.

Don’t shun networking

Taking the time to network can provide incredible opportunities to your business that otherwise wouldn’t have existed.

Networking can help you build a strong contacts book of like-minded professionals whom you may be able to call upon for their expertise or services when it is needed. It may also get you in touch with an interested investor, a potential new business partner or it can, of course, provide you with a string of new, loyal clients. In a city like London, there is no shortage of networking opportunities. For many entrepreneurs running small and medium-sized enterprises (SMEs), networking is their lifeblood.

With that said, not everyone is comfortable when it comes to networking. If you are not a social butterfly and most definitely do not want to be the centre of attention, consider sending an employee or delegate who has all the social skills, charisma and charm to build an excellent network that will benefit you and your business.

Not having proper guidance

Being your own boss does not mean you have to work alone – in fact, we like to say that superheroes never save the day alone, they are always supported by a cast of sidekicks and well-wishers who help them achieve their goals and ‘save the day’.

As an entrepreneur, you need sidekicks to help you achieve your goals, which is exactly how we see ourselves at Berley. Our aim is to help you, our clients who run small businesses and start-ups in London, achieve your goals and be successful in your endeavours.

Berley can help your business overcome challenges

When entrepreneurial life is getting you down and the everyday challenges of your business are becoming overwhelming, it is time to re-energise and re-strategise your approach. At Berley, our small business chartered accountants are here to take the strain off of you and provide your company with a suite of services that will allow you to focus on growing your business like a true entrepreneur.

Like any good sidekick, we will handle the messy, administrative matters while you – our entrepreneurial superhero – can focus on generating revenue, reaching your goals and maybe even saving the world if you like. Our services include:

• Outsourced payroll services: setting up simple payroll processes to save you time, money and energy.
• Management accounts: providing vital advice, insights and reports into the financial health of your business.
• Business finance solutions: supercharging your chances of success by helping you to find and apply for funding opportunities and investment successfully.
• Bookkeeping: we can prepare annual and monthly accounts, VAT returns and even help you set up your own management accounting systems.
• Company audit: our holistic ‘health’ check will provide you with an incredibly detailed audit tailored to the specific requirements of your business.
• Online accounting: our accountants utilise the cloud-based Xero to deliver excellent online accounting that can save you time and money.

We know entrepreneurs and we love working with entrepreneurs. To find out how we can unlock your true entrepreneurial superpowers, simply aim your bat signal to the sky (or, if it is easier, call us on 020 7636 9094 today).

Berley is here for your small business.

If you liked this post, you might also like:

• What is the right source of funding for you?
• How to become a financially secure business
• The hiring dilemma
• 5 ways to manage rising business costs

This post is intended to provide information of general interest about current business/ accounting issues. It should not replace professional advice tailored to your specific circumstances.