It’s easy to focus on the positive aspects of starting a business, but what about the negatives? Problems are much easier to face when you can anticipate them at least marginally. While you can’t possibly foresee every possible obstacle you might face, you can prepare for some of the most likely scenarios. When starting a business, your first priority should be to have all of the necessary information so that your venture has the best chance of succeeding.
1- Your Knowledge of the Industry is Never Complete
You might think that you know everything there is to know about opening a sporting goods store or a restaurant, but you’re in for a rude awakening. When starting a business, you’re likely to discover that you don’t know much of anything about your chosen industry and that research is an ongoing battle. Business owners must manage and oversee every aspect of the company, from marketing to manufacturing, and although you might be as prepared as possible, you’re likely to overlook this when starting a business.
To safeguard against this potential obstacle, keep your mind open to new and different things. Don’t be afraid to call up a consultant or head to the bookstore to stock up on the latest resources because your business will fare better and you’ll be more capable of preparing yourself for other obstacles that might present themselves.
2- Paperwork Can Become Complicated
The initial paperwork for starting a business can be prohibitive, but that’s nothing compared to the ongoing paperwork you will have to manage. From invoices to receipts to taxes to contracts, you’re likely to be buried in paperwork for the next decade. Hiring competent administrative staff is one way to protect yourself from overlooking this problem, but you should also have consultants backing you so that you don’t make any costly legal mistakes.
Of the things that you might overlook when starting a business, this is arguably the most sensitive. If you don’t complete paperwork correctly and on time, you could be exposing your business to legal and financial ruin. Make sure that you know exactly what paperwork needs to be completed and when, and consult with an attorney or financial professional when you have questions.
3- You Might Lose Your Partner
While starting a business with a partner might seem like a great idea at conception, you might overlook the possibility for a future falling out. Nothing can come between friends and family members faster than financial peril and the sheer volume of decisions necessary for starting a business can cause disagreements to escalate.
Make sure that you have signed a contract with your business partner that specifies what happens in the event of irreconcilable differences. One of you might have to buy the other out or you may have to dissolve the business entirely. Talk with an experienced business attorney to determine the best possible contingency plan.
4- You’re Taking On All the Risk
Risk factor is one of the most common things that people overlook when starting a business. Over the last few years, you will be spending countless hours and limitless energy on keeping your business venture afloat. What will you have to sacrifice to make your dreams come true? Some start-up business owners will personally guarantee loans and even put their assets up as collateral in order to get their business off the ground, but what if it fails?
Make sure that you have a competent financial planner in your corner for advice and guidance. Assess your risk factor with consideration for the future and for your family before making any decisions.
5- You Can’t Foresee Everything
As mentioned above, you can’t possibly foresee everything that might or will happen in the future. Business owners often overlook the fact that starting a business is a gamble and that things don’t always work out exactly as you’d hoped. Talk with friends, family and colleagues about your options if things start to go south and what you might do to get your business back on track.