challenges faced by an entrepreneur when writing a business plan

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challenges faced by an entrepreneur when writing a business plan

What Is a Business Plan?

A business plan is a written document that outlines your business. It covers everything from your business history and current status to your sales and marketing strategy and how you plan on turning a profit. A business plan is critical for all businesses, no matter how small or large. Without one, it's difficult to track your progress and make adjustments as needed. Plus, if you're ever looking for investors or loans, a strong business plan will give them the confidence they need to support your venture.

Why do I need a business plan?

A business plan is important because it gives you a road map to follow as you start and grow your business. It can help you attract new investors and customers, and keep everyone on track as you move forward.

How often should I update my business plan?

You should update your business plan as your business grows and changes. At a minimum, you should review and revise it annually. However, you may need to make more frequent updates if you're experiencing rapid growth or making major changes to your business.

What are the three main purposes of a business plan?

The three main purposes of a business plan are to:

- Help you get a clear picture of your business and what you want it to achieve

- Convince investors or lenders to support your venture

- Keep you on track as you grow your business

If you're just starting out, a business plan can also help you get a better understanding of your industry and how to position your company in the market.

What are the key components of a business plan?

There is no one-size-fits-all answer to this question, as the key components of a business plan vary depending on the type and size of the business. However, all plans should include an executive summary, an overview of the company's history, a description of products or services, the target market, the sales and marketing strategy, and financial projections.

What are some tips for writing a successful business plan?

Here are a few tips to help you write a successful business plan:

- Do your research. Before you start writing, find out as much as you can about your industry and what it takes to start and grow a successful business in that field.

- Be realistic. Don't try to inflate your numbers or make unrealistic predictions in an effort to make your business look more successful than it is. Investors will see through this and it will damage your credibility.

- Keep it concise. No one wants to read a 100-page business plan. Try to keep your plan to 10 pages or less, with clear and concise language.

- Get help if you need it. If you're not sure where to start, there are plenty of business plan templates and examples available online. You can also hire a professional business plan writer to get the job done for you.

What are some common mistakes to avoid when writing a business plan?

Here are a few common mistakes to avoid when writing a business plan:

- Not doing your research. Before you start writing, find out as much as you can about your industry and what it takes to start and grow a successful business in that field.

- Making unrealistic predictions. Don't try to inflate your numbers or make unrealistic predictions in an effort to make your business look more successful than it is. Investors will see through this and it will damage your credibility.

- Overcomplicating things. No one wants to read a 100-page business plan. Try to keep your plan to 10 pages or less, with clear and concise language.

- Not getting help when you need it. If you're not sure where to start, there are plenty of business plan templates and examples available online.

Types of business plans:

There are two types of business plans: traditional and lean startup.

Traditional business plans

A traditional business plan is a document that typically includes detailed information about the company's products or services, marketing strategy, management team, financial projections, and more. This type of business plan is often used by banks and other investors to get a better understanding of the company before they provide funding.

Writing a traditional business plan can be a daunting task, but it doesn't have to be. By understanding the structures of traditional business plan s and what should be included in each section, you can make the process much simpler.

A traditional business plan typically includes the following sections:

- The executive summary is the first section of the business plan and it should provide an overview of the main points of the plan.

- The company description is the second section and it should provide more detail about the company, its history, its products or services, and its mission.

- The market analysis is the third section and it should provide information about the target market, the competition, and the market trends.

-The fourth section, sales and marketing strategy, should describe how the company plans to generate sales and grow the business.

-The fifth section, management team, should provide information about the company's management team and its experience.

-The sixth section, financial projections, should provide financial information about the company, such as its revenue, expenses, and profitability.

- The appendix is the last section of the plan and it should include any additional information that would be helpful for understanding the company.

Lean business plans

A Lean business plan or Lean startup business plan is a shorter and simpler version of a traditional business plan. It focuses on the key elements of the company, such as the problem that it solves, the target market, the solution, the business model, and key metrics. This type of business plan is often used by startup companies that want to get a better understanding of their business before they start raising money.

Simple business planning makes writing a plan faster and easier, and helps you get your thoughts down on paper so that you can better understand your business.

To write a lean startup business plan, you'll need to:

-Identify your target market

-Describe your solution

-Explain your business model

-Define your key metrics

-Set your milestones

How should a business plan look?

A good business plan should be:

- Concise: The best business plans are clear, concise, and to the point. They are not overly long or filled with unnecessary fluff.

- Realistic: A good business plan is realistic and achievable. It sets realistic goals and milestones, and it doesn't make promises that can't be kept.

- Flexible: A good business plan is flexible and can be adjusted as the company grows and changes.

- Focused: A good business plan is focused on a specific market or opportunity. It doesn't try to do too much or be all things to all people.

When you're writing a business plan, it's important to keep in mind that the goal is to create a document that will be used to help you run and grow your business. This means that the plan should be clear, concise, and achievable. It should also be flexible so that it can be adjusted as the company grows and changes.

Finally, it should be focused on a specific market or opportunity. By remembering these key points, you can make sure that your business plan is as effective as possible.

How to Write a Solid Business Plan, Step by Step Guide

There are some key steps that all businesses should take when writing a business plan.

1. Define the purpose of the business plan.

2. Research the market and competition.

3. Describe the company and its products or services.

4. Develop a marketing and sales strategy.

5. Create financial projections.

6. Write the executive summary.

7. assemble and organize the plan.

8 Review and revise the plan as needed.

By following these steps, you can be sure that your business plan is comprehensive and well-organized, and that it will effectively communicate your business's goals and objectives.

Challenges you face while writing a detailed business plan

Writing a business plan is not a cup of tea. It includes many tasks like establishing the business’ focus, obtaining funding, and getting new investors. Your business plan is essentially your road map to success.

It is critical to have a business plan if you are obtaining funds and the difficulty you face depends upon the type of business you have, the size of your business, and the intricacy of your desired result.

It is unique to every business as it tells about:-

The current position of your organisation,
Overall prospects of your industry(e.g., developing, stagnant or decreasing),
How you stand unique among the competitors,
What are your predictions for your sales and revenue for the next year, next five years, etc.,
How will you make your estimation realistic?

For industries like finance, there are additional regulations that have to be included.

The challenges you face while writing a business plan depend upon the type of business you have, the size of your business, and the intricacy of your desired result. However, some key challenges include:

- Getting Started: The most important and difficult part about writing a business plan is getting it started. Until and unless you make a blueprint of how you should strategize it, you will continue messing it up. When you start making a business plan, lock yourself in a room, switch off your phones, and focus.

- Defining the purpose of the plan: What is the goal of the business plan? What are you hoping to achieve with it?

- Researching the market and competition: What is the current market landscape? Who are your major competitors?

- Describing the company and its products or services: What does your company do? What are its unique selling points?

- Developing a marketing and sales strategy: How will you generate leads and convert them into customers?

- Writing the executive summary: How do you concisely and effectively communicate the key points of the plan?

- Assembling and organizing the plan: How do you structure the plan so that it is easy to read and understand?

- Reviewing and revising the plan: Is the plan realistic and achievable? Does it need to be updated as the company grows and changes?

- Financial Estimation: It is difficult to estimate the figures on a brand-new concept. There is no roadmap, nobody whom you can follow. Find a similar company and try to measure how they identify their cash flows and make the plan.

- Prove that your business idea is best: One of the challenging problems in writing a business plan is to prove the investors and lenders that your idea is worth their investments otherwise they won’t take interest in your idea.

- Realistic Business Plans: You need to be honest about the plans, generally, entrepreneurs’ dream about their business, and when they make a business plan, it challenges their assumptions about the opportunities in their market, its competition, products and growth estimations. That is where they get caught up in defining an executable business plan. Create a strategy that you will actually be working upon not just making castles in the air.

By keeping these challenges in mind, you can ensure that your business plan is as strong as possible.

Is it hard to write a business plan?

The difficulty you face depends upon the type of business you have, the size of your business, and the intricacy of your desired result.

Do I Need a Simple or Detailed Plan?

The type of business plan you need depends on your goals and objectives. If you are seeking funding, you will need a more comprehensive and detailed plan. If you are not seeking funding, a simpler and shorter plan may suffice.

How long does it take to write a business plan?

Again, the answer to this question depends on the type of business you have, the size of your business, and the intricacy of your desired result. A simple plan can be completed in a matter of hours, while a more detailed plan can take days or even weeks to complete. No matter what type of business you have, it is important to take the time to carefully craft a well-thought-out business plan.

Who can make me a business plan?

There are a number of resources available to help you write a business plan. You can hire a professional business plan writer, use a business plan template or software, or even do it yourself.

The 5 toughest things entrepreneurs face when starting a business

1. Coming up with a business idea

2. Researching the market and competition

3. Describing the company and its products or services

4. Developing a marketing and sales strategy

5. Creating financial projections

Are business plans useful?

Business plans can be an invaluable tool for any business, small or large. By taking the time to write a comprehensive and well-organized plan, you can effectively communicate your company's goals and objectives, and make sure that everyone on your team is on the same page.

A business plan can also help you raise money from investors, and keep track of your company's progress over time. Whether you are starting a new business or growing an existing one, a business plan is an essential tool.

By taking the time to research and write a well-thought-out plan, you can increase your chances of success and ensure that your business is on the right track.

8 Tips for Successful Business plan

There are a 8 key pieces that should be included in every successful business plan.

-The company's products or services: Describe the problem that your product or service solves and how it is different from other products or services on the market. Be sure to include information about the features and benefits of your product or service.

-The target market: Describe the people or businesses that you plan to sell your product or service to. Be sure to include information about their needs and how your product or service meets those needs.

-The marketing strategy: Describe how you plan to market your product or service to your target market. Be sure to include information about your sales process, pricing strategy, and promotional activities.

-The management team: Introduce the people who will be responsible for running the day-to-day operations of the business. Be sure to include information about their experience, skills, and education.

-The financial projections: Include detailed financial statements that show how much money you expect to make and spend over the next three years. Be sure to include information about your revenue, expenses, and profits.

-The company's history: Describe the history of the company, including any milestones or accomplishments.

-The risks and challenges: Discuss the risks and challenges that your business faces and how you plan to overcome them.

-The exit strategy: Describe how you plan to exit the business, such as selling it to another company or taking it public.

FAQs on Writing a Business plan

What is the biggest mistake in preparing a business plan.

The biggest mistake is not doing your homework. Make sure you understand your industry, your market, your competition, and your customers before you start writing your business plan.

Do I need a business plan if I'm not seeking funding?

While a business plan is not required if you are not seeking funding, it can still be a valuable tool for any business. A business plan can help you to clarify your goals and objectives, and keep track of your company's progress over time.

Can I use a business plan template?

Yes, there are many business plan templates available online. However, it is important to make sure that the template you choose is appropriate for your industry and business model.

How long should my business plan be?

There is no hard and fast rule for the length of a business plan. However, a good rule of thumb is to keep it as concise as possible. Your goal should be to communicate your company's key points in a clear and concise manner.

What makes a bad business plan?

A bad business plan is one that is either too long or too short, and does not effectively communicate your company's key points. It should also be free of grammar and spelling errors, and should be clear and easy to read.

How can I make my business plan stand out?

One way to make your business plan stand out is to include a cover letter that briefly introduces your company and its products or services. You should also make sure to proofread your business plan carefully, and have someone else read it as well before you submit it.

Why do some business plans fail?

There are many reasons why business plans fail. Sometimes, the company does not do enough research on the market or the competition. Other times, the plan is not well-written or organized. And sometimes, the company simply does not have a viable business model.

You should update your business plan as your company grows and changes. As your business evolves, so too should your business plan. Review and update your plan at least once a year, or more often if needed.

What are the biggest challenges in scaling a business?

The biggest challenges in scaling a business include finding new customers, expanding into new markets, and hiring new employees. As your company grows, you will need to find ways to reach new customers and continue to provide excellent customer service. Additionally, you will need to expand your operations to meet the demands of your growing business. Finally, you will need to hire new employees to support your company's growth.

A business plan is a road map to success and is critical for obtaining funding. A well-written, proofread business plan will make your company more likely to succeed. The biggest challenges in scaling a business include finding new customers, expanding into new markets, and hiring new employees.

With careful planning and execution, you can overcome these challenges and successfully scale your business. By following these tips, you can ensure that your company is well-positioned for growth. By following these tips, you can write a comprehensive and well-organized business plan that will help you achieve your desired results. With a little time and effort, you can put your company on the path to success.

By The Thrive

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How to Prepare and Write the Perfect Business Plan for Your Company Here's how to write a business plan that will formalize your company's goals and optimize your organization.

By Matthew McCreary May 5, 2021

Are you preparing to start your own business but uncertain about how to get started? A business plan ought to be one of the first steps in your entrepreneurial journey because it will organize the ideas that have been spinning around in your brain and prepare you to seek funding, partners and more.

What is a business plan?

A business plan is a detailed document that outlines a company's goals and how the business, well, plans to achieve those goals over the next three or more years. It helps define expected profits and challenges, providing a road map that will help you avoid bumps in the road.

Stever Robbins writes in an Entrepreneur article titled, "Why You Must Have a Business Plan," that a business plan "is a tool for understanding how your business is put together…. Writing out your business plan forces you to review everything at once: your value proposition, marketing assumptions, operations plan, financial plan and staffing plan." But, a business plan is about more than just reviewing the past state of your business or even what your business looks like today.

Robbins writes that a well-written business plan will help you drive the future by "laying out targets in all major areas: sales, expense items, hiring positions and financing goals. Once laid out, the targets become performance goals."

The business plan can help your company attract talent and funding, because when prospects ask about your business, you already have an articulated overview to offer them. How they react can allow you to quickly understand how others see your business and pivot if necessary.

What should you do before you write your business plan?

It might sound redundant, but you actually need to plan your business plan. Business plans can be complicated, and you'll be held accountable for the goals you set. For example, if you plan to open five locations of your business within the first two years, your investors might get angry if you only manage to open two.

That's why it's essential that, before writing your business plan, you spend some time determining exactly which objectives are essential to your business. If you're struggling to come up with a list of goals on your own, Entrepreneur article "Plan Your Business Plan" offers some questions you can ask yourself to spark some inspiration.

How determined am I to see this venture succeed?

Am I willing to invest my own money and work long hours for no pay, sacrificing personal time and lifestyle, maybe for years?

What's going to happen to me if this venture doesn't work out?

If it does succeed, how many employees will this company eventually have?

What will be the business's annual revenue in a year? What about in five years?

What will be the company's market share in that amount of time?

Will the business have a niche market, or will it sell a broad spectrum of goods and services?

What are my plans for geographic expansion? Should it be local or national? Can it be global?

Am I going to be a hands-on manager, or will I delegate a large proportion of tasks to others?

If I delegate, what sorts of tasks will I share? Will it be sales, technical work or something else?

How comfortable am I taking direction from others? Can I work with partners or investors who demand input into the company's management?

Is the business going to remain independent and privately owned, or will it eventually be acquired or go public?

It's also essential to consider your financial goals. Your business might not require a massive financial commitment upfront, but it probably will if you're envisioning rapid growth. Unless you're making your product or service from scratch, you'll have to pay your suppliers before your customers can pay you, and as "Plan Your Business Plan" points out, "this cash flow conundrum is the reason so many fast-growing companies have to seek bank financing or equity sales to finance their growth. They are literally growing faster than they can afford."

How much financing will you need to start your business? What will you be willing to accept? If you're desperate for that first influx of cash, you might be tempted to accept any offer, but doing so might force you to either surrender too much control or ask investors for a number that's not quite right for either side.

These eight questions can help you determine a few financial aspects of your planning stages:

What initial investment will the business require?

How much control of the business are you willing to relinquish to investors?

When will the business turn a profit?

When can investors, including you, expect a return on investment?

What are the business's projected profits over time?

Will you be able to devote yourself full-time to the business?

What kind of salary or profit distribution can you expect to take home?

What are the chances the business will fail, and what will happen if it does?

You should also consider who, primarily, is going to be reading your business plan, and how you plan to use it. Is it a means of raising money or attracting employees? Will suppliers see it?

Lastly, you need to assess the likelihood of whether you actually have the time and resources to see your plan through. It might hurt to realize the assumptions you've made so far don't actually make a successful business, but it's best to know early on, before you make further commitments.

Related: Need a Business Plan Template? Here Is Apple's 1981 Plan for the Mac.

How to Write a Business Plan

Once you've worked out all the questions above and you know exactly what goals you have for your business plan, the next step is to actually write the darn thing. A typical business plan runs 15 to 20 pages but can be longer or shorter, depending on the complexity of the business and the needs of your venture. Regardless of whether you intend to use the business plan for self-evaluation or to seek a seven-figure investment, it should include nine key components, many of which are outlined in Entrepreneur 's introduction to business plans:

1. Title page and contents

Presentation is important, and a business plan should be presented in a binder with a cover that lists the business's name, the principals' names and other relevant information like a working address, phone number, email and web address and date. Write the information in a font that's easy to read and include it on the title page inside, too. Add in the company logo and a table of contents that follows the executive summary.

2. Executive summary

Think of the executive summary as the SparkNotes version of your business plan . It should tell the reader in as few words as possible what your business wants and why. The executive summary should address these nine things:

The business idea and why it is necessary. (What problem does it solve?)

How much will it cost, and how much financing are you seeking?

What will the return be to the investor? Over what length of time?

What is the perceived risk level?

Where does your idea fit into the marketplace?

What is the management team?

What are the product and competitive strategies?

What is your marketing plan?

What is your exit strategy?

When writing the executive summary, remember that it should be somewhere between one-half page to a full page. Anything longer, and you risk losing your reader's attention before they can dig into your business plan. Try to answer each of the questions above in two or three sentences, and you'll wind up with an executive summary that's about the right length.

Related: First Steps: Writing the Executive Summary of Your Business Plan

3. Business description

You can fill anywhere from a few paragraphs to a few pages when writing your business description, but try again to keep it short, with the understanding that more sections will follow. The business description typically starts with a short explanation of your chosen industry, including its present outlook and future possibilities. Use data and sources (with proper footnotes) to explain the markets the industry offers, along with the developments that will affect your business. That way, everyone who reads the business description, particularly investors, will see that they can trust the various information contained within your business plan.

When you pivot to speaking of your business, start with its structure. How does your business work? Is it retail, service-oriented or wholesale? Is the business new or established? Is the company a sole proprietorship, partnership or corporation? Who are the principals and who are your customers? What do the distribution channels look like, and how can you support sales?

Next, break down your business's offerings. Are you selling a physical product, SaaS or a service? Explain it in a way that a reader knows what you're planning to sell and how it differentiates itself from the competition (investors call this a Unique Selling Proposition, or USP, and it's important that you find yours). Whether it's a trade secret or a patent, you should be specific about your competitive advantage and why your business is going to be profitable. If you plan to use your business plan for fundraising, you can use the business description section to explain why new investments will help make the business even more profitable.

This, like everything else, can be brief, but you can tell the reader about your business's efficiency or workflow. You can write about other key people within the business or cite industry experts' support of your idea, as well as your base of operations and reasons for starting in the first place.

4. Market strategies

Paint a picture about your market by remembering the four Ps: product, price, place and promotion.

Start this section by defining the market's size, structure and sales potential. What are the market's growth prospects? What do the demographics and trends look like right now?

Next, outline the frequency at which your product or service will be purchased by the target market and the potential annual purchase. What market share can you possibly expect to win? Try to be realistic here, and keep in mind that even a number like 25% might be a dominant share.

Next, break down your business's plan for positioning, which relates to the market niche your product or service can fill. Who is your target market, how will you reach them and what are they buying from you? Who are your competitors, and what is your USP?

The positioning statement within your business plan should be short and to the point, but make sure you answer each of those questions before you move on to, perhaps, the most difficult and important aspect of your market strategy: pricing.

In fact, settling on a price for your product or service is one of the most important decisions you have to make in the entire business plan. Pricing will directly determine essential aspects of your business, like profit margin and sales volume. It will influence all sorts of areas, too, from marketing to target consumer.

There are two primary ways to determine your price: The first is to look inward, adding up the costs of offering your product or service, and then adding in a profit margin to find your number. The second is called competitive pricing, and it involves research into how your competitors will either price their products or services now or in the future. The difficult aspect of this second pricing method is that it often sets a ceiling on pricing, which, in turn, could force you to adjust your costs.

Then, pivot the market strategies section toward your distribution process and how it relates to your competitors' channels. How, exactly, are you going to get your offerings from one place to the next? Walk the reader step by step through your process. Do you want to use the same strategy or something else that might give you an advantage?

Last, explain your promotion strategy. How are you going to communicate with your potential customers? This part should talk about not only marketing or advertising, but also packaging, public relations and sales promotions.

Related: Creating a Winning Startup Business Plan

5. Competitive analysis

The next section in your business plan should be the competitive analysis, which helps explain the differences between you and your competitors … and how you can keep it that way. If you can start with an honest evaluation of your competitors' strengths and weaknesses within the marketplace, you can also provide the reader with clear analysis about your advantage and the barriers that either already exist or can be developed to keep your business ahead of the pack. Are there weaknesses within the marketplace, and if so, how can you exploit them?

Remember to consider both your direct competition and your indirect competition, with both a short-term and long-term view.

6. Design and development plan

If you plan to sell a product, it's smart to add a design and development section to your business plan. This part should help your readers understand the background of that product. How have the production, marketing and company developed over time? What is your developmental budget?

For the sake of organization, consider these three aspects of the design and development plan:

Product development

Market development

Organizational development

Start by establishing your development goals, which should logically follow your evaluation of the market and your competition. Make these goals feasible and quantifiable, and be sure to establish timelines that allow your readers to see your vision. The goals should address both technical and marketing aspects.

Once the reader has a clear idea of your development goals, explain the procedures you'll develop to reach them. How will you allocate your resources, and who is in charge of accomplishing each goal?

The Entrepreneur guide to design and development plans offers this example on the steps of producing a recipe for a premium lager beer:

Gather ingredients.

Determine optimum malting process.

Gauge mashing temperature.

Boil wort and evaluate which hops provide the best flavor.

Determine yeast amounts and fermentation period.

Determine aging period.

Carbonate the beer.

Decide whether or not to pasteurize the beer.

Make sure to also talk about scheduling. What checkpoints will the product need to pass to reach a customer? Establish timeframes for each step of the process. Create a chart with a column for each task, how long that task will take and when the task will start and end.

Next, consider the costs of developing your product, breaking down the costs of these aspects:

General and administrative (G&A) costs

Marketing and sales

Professional services, like lawyers or accountants

Miscellaneous costs

Necessary equipment

The next section should be about the personnel you either have or plan to hire for that development. If you already have the right person in place, this part should be easy. If not, then this part of the business plan can help you create a detailed description of exactly what you need. This process can also help you formalize the hierarchy of your team's positions so that everyone knows their roles and responsibilities.

Finish the development and design section of your business plan by addressing the risks in developing the product and how you're going to address those risks. Could there be technical difficulties? Are you having trouble finding the right person to lead the development? Does your financial situation limit your ability to develop the product? Being honest about your problems and solutions can help answer some of your readers' questions before they ask them.

Related: The Essential Guide to Writing a Business Plan

7. Operations and management plan

Want to learn everything you'll ever need to know about the operations and management section of your business plan, and read a real, actual web article from 1997? Check out our guide titled, "Writing A Business Plan: Operations And Management."

Here, we'll more briefly summarize the two areas that need to be covered within your operations and management plan: the organizational structure is first, and the capital requirement for the operation are second.

The organizational structure detailed within your business plan will establish the basis for your operating expenses, which will provide essential information for the next part of the business plan: your financial statements. Investors will look closely at the financial statements, so it's important to start with a solid foundation and a realistic framework. You can start by dividing your organizational structure into these four sections:

Marketing and sales (including customer relations and service)

Production (including quality assurance)

Research and development

Administration

After you've broken down the organization's operations within your business plan, you can look at the expenses, or overhead. Divide them into fixed expenses, which typically remain constant, and variable, which will change according to the volume of business. Here are some of the examples of overhead expenses:

Maintenance and repair

Equipment leases

Advertising and promotion

Packaging and shipping

Payroll taxes and benefits

Uncollectible receivables

Professional services

Loan payments

Depreciation

Having difficulty calculating what some of those expenses might be for your business? Try using the simple formulas in "Writing A Business Plan: Operations And Management."

8. Financial factors

The last piece of the business plan that you definitely need to have covers the business's finances. Specifically, three financial statements will form the backbone of your business plan: the income statement, the cash-flow statement and balance sheet . Let's go through them one by one.

The income statement explains how the business can make money in a simple way. It draws on financial models already developed and discussed throughout the business plan (revenue, expenses, capital and cost of goods) and combines those numbers with when sales are made and when expenses are incurred. When the reader finishes going through your income statement, they should understand how much money your company makes or loses by subtracting your costs from your revenue, showing either a loss or a profit. If you like, you or a CPA can add a very short analysis at the end to emphasize some important aspects of the statement.

Second is the cash-flow statement, which explains how much cash your business needs to meet its obligations, as well as when you're going to need it and how you're going to get it. This section shows a profit or loss at the end of each month or year that rolls over to the next time period, which can create a cycle. If your business plan shows that you're consistently operating at a loss that gets bigger as time goes on, this can be a major red flag for both you and potential investors. This part of the business plan should be prepared monthly during your first year in business, quarterly in your second year and annually after that.

Our guide on cash-flow statements includes 17 items you'll need to add to your cash-flow statement.

Cash. Cash on hand in the business.

Cash sales . Income from sales paid for by cash.

Receivables. Income from collecting money owed to the business due to sales.

Other income. The liquidation of assets, interest on extended loans or income from investments are examples.

Total income. The sum of the four items above (total cash, cash sales, receivables, other income).

Material/merchandise . This will depend on the structure of your business. If you're manufacturing, this will include your raw materials. If you're in retail, count your inventory of merchandise. If you offer a service, consider which supplies are necessary.

Direct labor . What sort of labor do you need to make your product or complete your service?

Overhead . This includes both the variable expenses and fixed expenses for business operations.

Marketing/sales . All salaries, commissions and other direct costs associated with the marketing and sales departments.

Research and development . Specifically, the labor expenses required for research and development.

General and administrative expenses. Like the research and development costs, this centers on the labor for G&A functions of the business.

Taxes . This excludes payroll taxes but includes everything else.

Capital. Required capital for necessary equipment.

Loan payments. The total of all payments made to reduce any long-term debts.

Total expenses. The sum of items six through 14 (material/merchandise, direct labor, overhead, marketing/sales, research and development, general and administrative expenses, taxes, capital and loan payments).

Cash flow. Subtract total expenses from total income. This is how much cash will roll over to the next period.

Cumulative cash flow . Subtract the previous period's cash flow from your current cash flow.

Just like with the income statement, it's a good idea to briefly summarize the figures at the end. Again, consulting with a CPA is probably a good idea.

The last financial statement is the balance sheet. A balance sheet is, as our encyclopedia says, "a financial statement that lists the assets, liabilities and equity of a company at a specific point in time and is used to calculate the net worth of a business." If you've already started the business, use the balance sheet from your last reporting period. If the business plan you wrote is for a business you hope to start, do your best to project your assets and liabilities over time. If you want to earn investors, you'll also need to include a personal financial statement. Then, as with the other two sections, add a short analysis that hits the main points.

9. Supporting documents

If you have other documents that your readers need to see, like important contracts, letters of reference, a copy of your lease or legal documents, you should add them in this section.

Related: 7 Steps to a Perfectly Written Business Plan

What do I do with my business plan after I've written it?

The simplest reason to create a business plan is to help people unfamiliar with your business understand it quickly. While the most obvious use for a document like this is for financing purposes, a business plan can also help you attract talented employees — and, if you share the business plan internally, help your existing employees understand their roles.

But it's also important to do for your own edification, too. It's like the old saying goes, "The best way to learn something is to teach it." Writing down your plans, your goals and the state of your finances helps clarify the thoughts in your own mind. From there, you can more easily lead your business because you'll know whether the business is reaching the checkpoints you set out to begin with. You'll be able to foresee difficulties before they pop up and be able to pivot quickly.

That's why you should continue to update your business plan when the conditions change, either within your business (you might be entering a new period or undergoing a change in management) or within your market (like a new competitor popping up). The key is to keep your business plan ready so that you don't have to get it ready when opportunity strikes.

Entrepreneur Staff

Associate Editor, Contributed Content

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

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It’s a huge leap of faith, this whole entrepreneur thing. The first step is abandoning another career. It can feel like saying goodbye to an old friend. Or maybe it was more like getting out of an abusive relationship. But the rollercoaster ride doesn’t stop there. Here are the top challenges entrepreneurs face when starting a business and how to overcome them.

#1 Choosing What to Sell

Hey, if we knew exactly what everyone wanted and would pay for, we’d be rolling in dough, amirite? This is a big challenge entrepreneurs face when starting a business. What’s gonna sell, and will you earn a living doing selling it.

Let’s skip all the guessing games and go straight to the source — a freelance researcher.

Identify the field or industry your business is in, and then get a freelance researcher to mine for gold. With their expertise, you can find out which niches to explore, their profit margins, and get a complete SWOT analysis:

Opportunities

#2 Figuring Out a Marketing Strategy and Finding Customers

There are so many ways to get your offerings in front of the right people. You’ve got inbound and outbound marketing, digital marketing, traditional print marketing, and so much more. But that’s not all. How do you fit them all together into a cohesive, effective strategy?

Here’s the key to creating an airtight marketing strategy and finding customers:

Who is your audience? Where are they hanging out? How does your value proposition align with what they need and are looking for?

#3 Waiting and Self-doubt

Results are typically tardy to the party, and they take some time to show up. This doesn’t mean your business is doomed to fail. When I first started my business, it took almost nine months to get the cash flowing. And it began with a trickle.

When you’ve worked so hard at your business, and the take-off is slow going, the self-doubt starts creeping in.

Did I quit my 9-5 too soon? Will I never make enough to replace my income? Will my kids hate me and my cat run away?

All right, first of all, the answers are no, no , and no . The self-doubt you’re feeling is something that practically all of us entrepreneurs face when we’re in the early stages of a business venture. It’s natural to feel like this, but it’s not helpful.

When self-doubt strikes, let’s take a trip down memory lane.

What first drove you to become an entrepreneur? What are you passionate about? Think about all the times you hated working for a boss. Remember the excitement you felt the first time you ever sold something?

Concentrate on the good stuff, the stuff that drove you to start a business.

I know it’s hard to be patient and positive when the bills are coming in, and your kids need new shoes. But trust in the process. If you keep working hard and working smart, you’ll start replacing your old income. Which brings me to my next point.

#4 Cash Flow, Inconsistent Income, and Late Payments

Getting the cash flowing is one thing. Managing that cash flow is a whole other ball game. If you’re struggling to pay your business bills, you’re not alone.

Many new entrepreneurs hit this roadblock and have a tough time paying the bills, let alone paying themselves while they wait for the invoices to clear. So, what to do?

You’ve got to keep your business expenses separate from your personal expenses. Not only will this protect your cash flow, but it will also make tax prep and filing a lot easier.

Budgeting and planning are crucial, but I’ll be honest with you. The budget alone won’t cut it.

Get tough. Require a downpayment or a retainer for your services. If you bill for weekly recurring work, make the invoice due upon receipt. Doesn’t get paid? Then no more work. But really, just ask for down payments. Saves a lot of trouble.

What if you’re consistently dealing with late payments ? Consider giving people a discount if they pay early. That way, they’ll have an incentive to do it. Late payments get charged a penalty.

On the flip side, if you have a good relationship with your vendors, ask if they can invoice you every 45 or 60 days. This can help you stay on top of monthly bills and protect your cash flow.

#5 Time Management When You Wear Many Hats

This is a significant problem for entrepreneurs who wear many hats. If you had more time, you could accomplish it all! It’s kind of like if you had more money, all your problems would go away.

But here’s the thing about time. Like money, it doesn’t grow on trees. You’ve got to watch your spending and manage it. Getting a handle on your time management will help you strike the work-life balance you need.

So, do this:

Always ask yourself if what you’re doing is the best use of your precious time.
Create a goal list. Start big with the yearly goals. Break them down monthly, then weekly. Finally, break those down into daily goals.
Look at your daily goals. Do they absolutely positively have to be done by you? No? Great, let’s delegate.

#6 Delegating and Building Your Team

Delegating will free up so much of your time and make things more efficient. A more efficient business will equal greater cash flow in the long run.

So, what if you’ve delegated in the past, and stuff always got messed up? Well, there’s a couple of things you can do to overcome this entrepreneur challenge when starting a business.

You get what you pay for. If you keep going for the cheapest solution or contract work, you’ll get shoddy work, guaranteed. Take the blue pill. Start spending a little more on quality, and you won’t have to redo someone else’s work.
Be specific . Avoid assuming people know precisely what you want or know exactly how to do the things you need. It will take some time, but write down specific instructions. Instead of put the statistics in a spreadsheet and finish it Wednesday, instruct them to list the statistics alphabetically in an Excel spreadsheet and deliver by Wednesday 4 PM EST.

Paying more for high-quality work and giving your team specific instructions will help them succeed. A consistently high-performing team is going to have better morale and more confidence. By being specific and investing in your team and business , you’re giving them the tools they need to win and deliver great results every time.

#7 Balancing Perfection, Progress, and Keeping that Ego in Check

Are you a perfectionist? I’m raising my hand right now. When everything has to be just so it gets in the way of progress. Trust me, I know. As a bonafide perfectionist, I’ve had to learn this lesson myself.

Here’s the thing, friend. Perfect is the enemy of good. You don’t need something to be perfect. In fact, nothing is ever perfect. Ever, okay? Things just need to be good enough and get the job done. Trying to make everything perfect will waste your time.

We perfectionists struggle with letting go so others, who are just as capable, can shine and deliver. Delegate, let go of perfectionism and watch your business thrive and your team morale skyrocket.

#8 Combating Loneliness

When I became an entrepreneur, this was a challenge that I had no idea I’d face.

Most people are not entrepreneurs. They work a 9-5, and there’s nothing wrong with that. But it’s something that just isn’t for me, you know? I’m sure you can relate. When you’re the only entrepreneur in your peer group, it gets lonely . And quick.

Most people don’t know what you’re going through. It’s hard to bounce ideas off of people who’ve never been in your shoes. Most can’t relate to your struggles with cash flow, delegation, coming up with a marketing plan, all that jazz. When you’re a visionary, you might struggle with feeling like an odd duck.

Okay, so what to do? You’ve got to find your tribe.

Join entrepreneur groups. Reach out to other business owners on social media. Prioritize your closest relationships and make more time for them. It’s in these types of relationships where we feel the most understood, helping combat loneliness.

#9 Experiencing Business Growth

Business growth sounds like a good thing. And it sure is! But it also presents specific challenges. Grow, and you’ll eventually reach the point where you can’t take on any more work at your current capacity.

Here’s what you need to do.

Create new processes with a focus on task delegation. You love wearing different hats, I get it. But you’ll need to hang some up if you want to keep your business profitable and productive. If you do everything, you’ll hit the ceiling — a self-imposed one.

So, be your own best friend and not your worst enemy — breakthrough that ceiling through delegation and take yourself out of the production end. Go into management and on to pure unadulterated and blissful ownership.

#10 Navigating Work-Life Balance

Struggling to balance the demands of business and personal life?

•Establish firm boundaries between professional and personal time.
•Schedule regular breaks and allocate time for relaxation and family.

It’s essential to prioritize self-care and maintain hobbies or activities that rejuvenate you. Balancing these aspects is crucial for long-term success and preventing burnout. Remember, a well-rounded life enhances your capacity to run your business effectively.

Overcoming Common Challenges as an Entrepreneur: Action Steps

Starting a business comes with many challenges. But know this — you’re not alone, and many have traveled this road before you. Me included. I’ve figured out how to overcome these obstacles, grow, and thrive, and I know these tips will help you do the same.

You’re the builder, the designer, the chief architect of your business. You’re building this gorgeous castle and kingdom to rule over. So, how do you ensure that you’ve got a strong foundation from which to grow?

Marketing, growing, becoming profitable, and building a business you love really boils down to this:

Branding. Branding.Branding.

Get my Branding with Influence Guide . It’s a proven step-by-step process for creating cohesive brand messaging and visuals across multiple channels and platforms.

Branding is the key, the secret sauce, if you will, to building an audience and marketing your products effectively. Let’s get you on the road to success.

You’re the architect of your business and a branding guide is your foundation .

INSTAGRAM FEELS @DENISEMARIEBORRELLI

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challenges in developing business strategy

What challenges do entrepreneurs face in developing a successful business strategy?

Starting and running a business is no easy feat. As an entrepreneur, you’ll face many hurdles on the road to success. Having a sound business strategy is crucial, but crafting one that actually works takes thought, planning, and persistence.

In my decade covering startups and small businesses, I’ve seen companies triumph over challenges—and succumb to them. Through interviews with entrepreneurs, research on small business statistics, and my own observations, I’ve learned what issues trip up entrepreneurs most when strategizing.

In this post, I’ll cover the top challenges entrepreneurs face in building an effective business strategy and provide tips to tackle them. Mastering business strategy is tough, but understanding these common pitfalls can set you on the right path.

Defining the Target Customer

Knowing your ideal customer should guide every business decision you make. But many entrepreneurs launch a company without truly understanding their audience.

Questions to ask:

Who needs what I’m selling?
What are their pain points?
How can my offering solve those issues?

Pinpointing your target customer segment helps you:

Create products and services that properly meet their needs
Reach them through the right marketing channels
Better compete against others going after the same segment

For example, a bakery wanting to sell artisanal breads needs to know whether to target middle-income families looking for an affordable treat or higher-end restaurants wanting quality ingredients.

Conducting Market Research

Market research gives you essential information for structuring your strategy. It sheds light on:

Industry trends
Competitor landscapes
Customer demands
Pricing data
Growth opportunities and threats

However market research takes time and effort many entrepreneurs bypass. While you may understand your business idea well, you need concrete data on whether a profitable market exists.

Use market research to validate assumptions about your target customer, pricing models, and where you can capture market share. Aim to continually assess your market so you can adjust strategies over time.

Crafting a Unique Value Proposition

Once you identify target customers and research the competitive landscape, you need a compelling value proposition. This clear statement explains how your business solves a problem in a unique way.

Ask yourself:

What core customer need does my company address?
Why would customers buy from me vs. a competitor?
What makes my business stand out?

If your value proposition doesn’t resonate with your audience, you won’t attract customers. For example, a new pizza shop needs an angle besides just selling pizzas. Offering organic ingredients, unique toppings, or speedy delivery helps differentiate the business.

Managing Cash Flow

Money management poses one of the biggest challenges for new entrepreneurs. With little revenue at first, you need to control spending and have enough cash reserves to cover operating costs.

Smart financial strategies like these help buffer cash flow ups and downs:

Start part-time while keeping a day job
Seek investors to fund growth
Negotiate payment plans with vendors
Offer discounts or sales to boost revenue

Closely monitor income and expenses. Adjust budgets when needed but avoid growing too fast. Running out of cash is a top reason companies fail within their first year.

Hiring the Right Team

Employees play a huge role in whether your business thrives or flops. As an entrepreneur, you can only accomplish so much alone. Surround yourself with talented people who share your vision and values.

However hiring too quickly or recruiting the wrong people drains your resources. When building a team:

Write detailed job descriptions so candidates understand the role
Check references to confirm skills and experience
Ask situational questions during interviews to gauge problem-solving abilities
Start with part-time or freelance workers to fill gaps before hiring full-time

Also assess if responsibilities overlap. Clarify roles for each position so your team operates efficiently.

Adapting to Change

Markets shift, technologies advance, and crises hit. Entrepreneurs must adjust strategies to survive, especially in the early stages.

Regularly reassess your business model to see what’s working and what’s not
Watch your market for changes in trends or customer needs
Survey your target audience to spot evolving preferences
Review metrics like sales, traffic, and operational costs
Update products and marketing tactics to capitalize on new opportunities

While you need a solid foundation, inflexible business strategies crumble over time. Savvy entrepreneurs alter course quickly when circumstances warrant.

Avoiding Scope Creep

It’s tempting to expand your business ambitions over time by tweaking your core products and services. However uncontrolled growth in too many directions drains resources.

Scope creep happens when entrepreneurs:

Try to appeal to too many customer segments
Add unnecessary features and offerings
Venture into unrelated markets or geographies

Revisit your original business plan often. Eliminate elements distracting you from the heart of your company. Say no to “shiny penny” ideas that won’t deliver significant impact or revenue.

Laser focus on what makes you unique and where you can dominate the market. Don’t dilute your strengths by trying to be all things to all customers.

Overcoming Founder’s Syndrome

Many entrepreneurs struggle to delegate control. But holding onto too many decisions as your staff grows hurts productivity.

Signs of founder’s syndrome include:

Micromanaging employees rather than letting them work independently
Making all key choices yourself vs. seeking team input
Feeling threatened by talented hires taking on leadership roles

Loosen your grip by:

Hiring those smarter than you in key areas like operations, marketing, or technology
Empowering managers to make decisions within their realms
Giving up pet projects better handled by others
Instituting processes for getting buy-in on strategy

Letting go allows you to focus on high-level vision and strategy for growth. Your business will scale better if you avoid founder’s syndrome.

Key Takeaways

Know your target audience deeply before launching
Continuously research your market and adapt to changes
Craft a value proposition addressing customer needs better than competitors
Closely manage finances and cash flow
Build a skilled team but avoid overhiring
Tweak strategies when needed but prevent scope creep
Give up control and delegate responsibilities as you grow

While this list of challenges may seem daunting, thousands of entrepreneurs build thriving businesses every year. Developing an intelligent strategy with good foundations enables you to pivot when roadblocks arise. With dedication and persistence, you can overcome the most common pitfalls entrepreneurs face.

What questions do you have about crafting strong business strategies? What challenges have you faced in your own entrepreneurial journey? Share your thoughts and experiences in the comments below!

Partha Chakraborty

Partha Chakraborty is a venture capitalist turned entrepreneur with 17 years of experience. He has worked across India, China & Singapore. He is the founder of Tactyqal.com, a startup that guides other startup founders to find success. He loves to brainstorm new business ideas, and talk about growth hacking, and venture capital. In his spare time, he mentors young entrepreneurs to build successful startups.

How to Run a Startup on Autopilot?

Startup consulting

How i avoid unnecessary startup expenses

How I avoid Unnecessary Expenses for my Startup

1. Insufficient Business Planning

Starting a business without adequate planning is like setting off on a road trip without a map or GPS: you might have a general sense of the direction you’re headed in, but without a clear route, you’re likely to get lost along the way. Many first-time entrepreneurs underestimate the significance of planning, but having a proper business plan and doing your market research can help guide you to success.

Why Have a Business Plan?

“When you’re building a business, there are lots of opportunities that are before you. But chasing all those opportunities at the same time, when there’s only so much bandwidth to go around, produces diminishing results,” says Christian Dawson, Open Eye’s Co-founder and Executive Partner. “If you chase two rabbits, you catch none. What a business plan gives you is the opportunity to figure out which rabbit you’re going to chase.”

A good business plan should:

Articulate the company’s mission statement to ensure that all strategies, goals, and actions align with the overarching vision.
Include a SWOT analysis that identifies the business’s strengths, weaknesses, future opportunities, and potential threats.
Feature a competitor analysis that provides insights on how to refine your strategies, find your unique selling points, and seize opportunities in the market.
Have a plan for the business’s growth that can be adapted over time.

What About Market Research?

Focusing too much on the big idea can overshadow the importance of market research, leading to costly mistakes down the line. Understanding your target audience, the demand for your product or service, and potential geographical challenges, will position you for growth and help you make better informed business decisions.

2. Ineffective Marketing

Even the most innovative products or services can falter without good marketing, resulting in wasted resources, slower growth, and missed opportunities. That’s why it’s important to build a comprehensive marketing strategy that considers your target audience, competition, and the channels to reach potential customers.

“The most successful marketing campaigns really take into account the mission and the values of an organization,” says Dawson. “They should consider the specific problems that the group is trying to solve with their business plan, and show that they have a full understanding of the people that they are trying to target.”

3. Founder Knowledge and Skills Gaps

Being a business owner is a steep learning curve, and it’s not uncommon for founders to encounter questions they don’t have the answers to, or discover skill sets they need to develop. To bridge these knowledge gaps, founders should:

Commit to ongoing learning by reading industry-related books, taking online courses, attending workshops or participating in webinars.
Keep up with industry news and trends by subscribing to relevant publications, newsletters, and podcasts.
Consider finding a mentor—either through mentorship programs, business associations, or by reaching out to people in your network—with expertise in areas where you lack knowledge or skills.
If your budget allows, hire a consultant that can provide specialized guidance on specific challenges or projects.

4. Founder Well-being

Entrepreneurship can take a toll on a founder’s well-being—especially during the first year. The weight of new responsibilities, coupled with the uncertainty of the future, can often lead to self-doubt, isolation, and mental, physical, and emotional exhaustion. But your company can’t be at its best if you’re not at yours, so looking after your health isn’t just important, it’s essential.

“Hustle culture tries to squeeze as much as possible out of individuals in ways that aren’t sustainable,” says Dawson. “The most successful companies that we work with are ones that really do try to create a healthy working environment.”

To prevent burnout and reduce stress, make sure to keep active, eat well, manage your time efficiently, and prioritize work/life balance.

5. Poor Financial Management

Cash flow problems, failure to accurately forecast sales, and overspending can be detrimental for a new company, so entrepreneurs should prioritize financial literacy or enlist the help of a financial advisor.

Dawson recommends outlining metrics for success directly in your business plan, so you can track and manage expenses in a way that gives real visibility into the cost of goods sold. It’s also important to regularly monitor your financial health and, when possible, set aside funds for unexpected expenses.

6. Inadequate Funding Source

Securing money from investors or obtaining debt financing can be difficult, especially for first-time entrepreneurs. But strong financial management and strategic fundraising efforts can mitigate these challenges.

Make sure to explore various funding options, including crowdfunding or sourcing loans from angel investors or venture capitalists. Demonstrating clear value and growth potential to possible investors can increase your chances of securing external funding.

Revenue shortfalls are also common in the early stages of a business and can hinder growth. To prevent this, entrepreneurs should focus on creating a detailed financial plan that accounts for all potential expenses and revenue streams.

7. Human Resources

In the early stages of starting a business, some entrepreneurs struggle with delegating responsibilities as they transition into a leadership role, but it’s important to recognize that you can’t do everything on your own. Having a strong team behind you ensures that you can focus on the big picture without having to worry so much about the day-to-day operations.

Be sure to invest time into developing a recruitment and hiring strategy that identifies candidates who align with the company’s vision and culture. “To build a great team, you should really be articulating what kind of person will thrive in your environment,” says Dawson. “Someone may be an awesome person, but not the right fit for your team, and that’s okay.”

While starting a business can feel overwhelming at times, preparing for the challenges ahead can increase your chances of success and help you navigate the entrepreneurial gauntlet with confidence and resilience.

At Open Eye, we understand the unique challenges entrepreneurs face when starting a business. Oftentimes, startup consulting can help. If you’re looking for personalized guidance, one of our expert partners can help. Contact [email protected] for more information. Contact us here .

Christian Dawson
Strategy and Consulting

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How to Write a Business Plan

The 5 toughest things entrepreneurs face when starting a business

Starting a new business is exciting, especially when you have an idea you know will help others. But having your own business is also stressful.

Even when you take all the right steps — selecting a business model, writing a detailed business plan to attract potential investors, leveraging social media to build a customer base, and focusing on cash flow — your small business may still struggle along the way.

Here are five of the biggest challenges new entrepreneurs face, even with extensive planning and determination. Don’t be afraid of these common challenges. Almost all successful entrepreneurs overcome them at some point, and you can too.

Use Jotform’s powerful online forms to collect payments, signups, and other types of data for your business.

Lack of support

A lack of support is one of the many challenges you may face when starting your own business. It can be tough when others don’t believe in your idea, your ability to succeed, or you as a founder in general.

Get a mentor or business adviser to build support when family, friends, and colleagues aren’t there for you. Even other young entrepreneurs can provide support because they may have experienced some of these challenges and found a way to move past them. Their advice and hard work can inspire you to keep going even when those closest to you may not support your vision.

Lack of money

No one likes going without money, but you may have to forego that regular paycheck or deal with no revenue until you can get to market with your product. It’s even worse when you don’t get the venture capital funding you thought it would be easy to tap into.

Focus on what you need to do to generate revenue. Keep a lean budget so you can stretch what you do have. Learning to operate a business with little money may help you stay judicial with your finances even when the revenue is rolling in.

Lack of confidence

It’s easy to succumb to self-doubt because of your own worries, criticism from others, or lack of support from friends and family. You may wonder whether you’ll be able to succeed. These feelings may also creep in when your target audience doesn’t respond as enthusiastically as you thought they would or if external factors slow your business growth.

To get past your lack of confidence , dig deep and focus on what you’ve achieved and how far you’ve come. Make a list of achievements; this may help you realize just how much you’ve already accomplished, including barriers you’ve overcome. It may also be helpful to consult with a business coach or mentor to talk you through this mental block.

Lack of a clear pathway

Despite having a clear vision, you may reach a point where you don’t know how to align your business goals with that picture. There’s also a chance that you’ll be hit with something unexpected and have to deal with problems that you didn’t think would ever happen to you.

Stay calm and address these issues as soon as you can. Focus on moving ahead. Look at your business plan to see where you are.

Reviewing your overall strategy, time line, and tactics may clarify that pathway. If not, it may be time to conduct more market research to determine if you need to take a different approach to moving your business forward.

Not having a clear pathway may mean a pivot is necessary, which is another reason to conduct more research.

Lack of experience and knowledge

Eventually you‘ll hit a point in the learning curve where you feel clueless. Maybe you don’t know how to create an effective marketing strategy or how to develop a new product. Maybe you lack experience making a budget, negotiating, hiring talent, or balancing the books.

You may feel lost, but what’s really happening is that you’re just early in the process. Take time to learn how to do the things you’ve never done before. Benchmark what others have done rather than reinventing the wheel.

For instance, look at what the competition has done with their social media or lead generation to see what worked and what didn’t. Doing this can give you much-needed experience while helping you avoid costly missteps.

Other ways to build your knowledge include taking online courses, attending a workshop, or participating in an industry conference. Some entrepreneurs watch every YouTube video they can find on a subject and learn that way. Work one-on-one with your team members, like your developers, to better understand what they do. You can absorb that information to make better decisions about investments, tactics, and roles.

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Entrepreneurship

19 Free Resources On How To Write A Business Plan For Your Startup (That Won’t Suck)

Posted by by Vitaly Kuprenko
January 30, 2024

There are several challenges you face when starting a business. You’ll be ready to deal with anything if you’re prepared and have a strong business plan .

Before you start writing your business plan, you should outline it.

For example, your business plan sections might include:

Executive summary
Business description
Market strategies
Product design & development
Operations & management plan
Finance factors

You must add meat to the bone once you have your plan’s structure. But how do you write a business plan for your startup that will put you in a position to succeed?

Start with these 19 free business plan resources:

1. Y Combinator’s Startup Library

Y Combinator helps startups get through their first phases of funding, and their free startup library is full of helpful business planning resources.

To apply to Y Combinator and ask for their financial assistance, it is necessary to fill out an application form. The philosophy of Y Combinator founders implies a lack of total control over projects they fund, and, in their opinion, it is why startups succeed.

Of course, this service also provides a useful blog that includes articles and posts concerning how to write a startup business plan and steps to turn it into reality. So feel free to read it and get a piece of useful information.

2. Cleverroad’s Business Plan Guide

Writing a business plan for a startup doesn’t have to be boring and excessively formal. Nowadays, entrepreneurs can use a business model canvas that is a more agile form of the traditional business plan. A living document that can guide you as you grow your business.

If you want to know what you should include in your business plan, this step-by-step guide can help.

3. Entrepreneur’s 12-Step Startup Guide

Entrepreneur is a famous magazine and website that posts news, articles, and guides about entrepreneurship, business management, and everything.

Their 12-step startup guide is just one of their resources full of interesting tips on creating a business plan and launching a startup wisely.

4. Bplans

Bplans offers startups and business owners tips to enhance their business. Bplans contains many free sample business plans and provides users with tools and interactive calculators to manage their business more efficiently.

It’s a phenomenal resource for startups.

5. SCORE

SCORE is a non-profit organization that serves as a marketplace for volunteers experienced in helping small businesses grow and succeed.

The platform provides mentoring services to new entrepreneurs, including various on-demand webinars and courses ranging from startup business strategies to finances and management.

They also offer a free startup library of practical business-building resources.

6. SBA

SBA or U.S. Small Business Administration is the organization that’s been around since 1953, established to help small business owners and entrepreneurs properly build their business.

Today, the SBA’s website includes guides and tools for writing business plans and running your business successfully.

Apart from this, SBA provides customers with financial assistance and funding programs to take loans, find investors, use security bonds, etc.

7. Inc.

Inc. is an online magazine similar to Entrepreneur. It’s a great daily resource for business owners and CEOs looking for practical/useful advice on marketing, sales, raising capital, and so on.

And, of course, they have great business guides like this on how to write the perfect business plan.

8. Cayenne Consulting

CayCon is a consulting agency that specializes in drawing up business plans, creating pitch decks, and making financial forecasts.

If you’re looking for hands-on help, they can help you determine how your startup business plan should look, develop a business strategy, and present your project idea to investors.

9. Lean Planning

Lean business planning is a strategic approach to business plan writing created by Tim Berry, the founder of Bplans.

It proposes business plans should include the following areas of concern: strategy, tactics, AMMS (Assumptions, Milestones, Metrics, and Schedule), forecasts of sales, and expenses.

The Lean Planning website includes free how-to guides and tips for executing business plans that not only won’t “suck,” but they’ll also put you in a position to succeed.

10. Business Model Generation

Business Model Generation is a book written by Alexander Osterwalder and Yves Pigneur considered to be a deskbook for any who wants to change their business for the better and lead it to success.

This book has gained enormous popularity among long-time business owners and startups alike. It includes strategic ideas and tools that help businesses find and articulate their core value proposition. An excellent resource for writing a business plan.

11. Shopify’s Business Plan Guide

Shopify is a popular SaaS platform for eCommerce and its website includes a lot of helpful information for small business owners including how to write a business plan, how to set KPIs , and so on.

This business plan writing guide may be all you need to get started.

12. Mplans

Mplans is another awesome resource created by Tim Berry’s network. It offers entrepreneurs both software solutions and marketing resources including eBooks on public relations, marketing strategy, branding, and a vast number of free sample marketing plans.

Start here if you already built your plan with a detailed marketing approach.

13. ExpertHub

ExpertHub is another amazing online resource for business owners. In this article, they provide you with a comprehensive business plan format guide.

It’s a full guide to the business plan contents, including standard business plan format for these 10 basic elements:

The overview
General company description
The opportunity
Industry and market
Your strategy
Marketing plan
Operational plan
Financial plan
The appendix

14. Startups.com

Startups.com bills itself as the world’s largest launch platform for startups, providing education and tools to walk aspiring founders through the entire startup process. It includes resources on education, business planning, mentorship, customer acquisition, funding, and staffing.

Moreover, Startups.com has a library with playbooks, videos, founder stories, and expert advice. Visit a website to check out it in detail and make your idea real.

15. StartupNation

StartupNation is full of practical information about launching, running, and growing your business. It was created by two entrepreneurial brothers with loads of business experience. The site contains insightful articles from experts on a variety of business topics.

Apart from the website’s content, it also has community forums where business people can interact with each other and share their opinions and ideas.

16. Futurpreneur

Futurpreneur is a non-profit organization that offers young entrepreneurs mentoring, support, and financing. There are more than 3000 volunteer mentors who give startup advice.

Apart from coaching and mentoring, Futurpreneur also contains online resources with tools, articles, and interactive business plan writers.

17. Fast Company’s Creative Business Plan Guide

If you’re creative and considering starting a new venture or taking your work to the next level but feel unsure about the steps, this guide will get you going.

It details everything you need to know about how to write a business plan.

18. Forbes’ Business Plan Tips

In this Forbes piece, the author points out that the key issue is not whether to write a business plan but how to write a business plan.

There are many ways to do it. Some of these ways are efficient, and some of them are not. Here’s what you need to do it right.

19. Growthink’s Business Plan Template & Guide for Entrepreneurs

This business plan template and guide results from 20 years of research into the types of business plans that help entrepreneurs and executives raise funding and build thriving companies.

It’s primarily for those who have never created a business plan, but there’s plenty of advice for those who have written one or many plans.

Editor’s Note: This article is part of the blog series Start Your Business brought to you by the marketing team at Unitel, the virtual phone system priced and designed for startups and small business owners.

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8 Common Challenges Entrepreneurs Face (and How to Overcome Them)

Updated Aug. 5, 2022 - First published on May 18, 2022

By: DP Taylor

The challenges of starting a business are well-known. You wouldn't be here if you didn't wonder what you're in for as you contemplate launching the next app or developing a new beverage.

Whether you’re embarking on solopreneurship, infopreneurship, or becoming the next Steve Jobs, you will face adversity along the way. If you’ve decided to work for yourself , here are eight entrepreneurial problems you’re almost certain to face and how to handle each of them.

1. Deciding what to sell

Probably the biggest challenge of entrepreneurship is figuring out what kind of product or service to offer. It’s not an easy question because getting it wrong means your business will fail no matter how well-designed and set up it is.

Entrepreneurs must understand the customer who is likely to purchase their product, what market they are seeking to serve, what the competition looks like, what they could offer to give themselves a competitive advantage, if their target market is large enough to support the product, if their target market is too broad, and a host of other issues.

How to overcome it: Self-assess and research

There’s only one way to deal with this challenge: diligent research. You must come up with a detailed business plan that you can defend to any potential investor or partner. Your research should describe your target market in great detail and offer realistic plans for how you will become profitable -- not pie-in-the-sky predictions based on nothing more than hope.

You also have to assess yourself to determine if you have the energy to pursue this idea to fruition and whether you have the right skills and strengths for the job.

2. Marketing

To paraphrase sales guru Grant Cardone, if people don’t know you, they can't buy from you -- not won't buy from you but can't buy from you. Marketing introduces you and your brand to customers so it is possible for them to even consider buying your product and service.

But marketing is a challenge for entrepreneurs because oftentimes they’re strapped for cash, and building a brand through marketing can be expensive with no immediate benefit early on. You’ve got to decide how to market your product or service -- choose from mobile, social media, or print -- and determine whether it’s wise to work with outside agencies.

How to overcome it: Test and examine

When you’re starting out lean, you must figure out where your marketing money will get the most bang for the buck. Start small with free social media platforms and try out a few different approaches.

Consider broad, more capital-intensive approaches based on some of the results you see. Always start with a small marketing effort and collect extensive data and business metrics on various approaches before jumping in with both feet.

3. Hiring talent

Entrepreneurs who want to expand must find help. At a certain point, you can’t do it all on your own. But finding the right people is a big challenge, especially early on before you have your own human resources department and processes.

You must learn how to identify what type of people you need, how to evaluate them, and how to integrate them into your business so they are vital parts of your organization rather than “gofers” who need constant direction. You must invest time in reviewing credentials and candidates, or employees may actually hinder success.

How to overcome it: Narrow your focus

Develop a specific description of the role you’re hiring for and a detailed breakdown of what skills and personality attributes you need for the position. Then start vetting applicants, checking each box to see how many of these attributes they meet so you can compare them later. Considering using outside headhunters to take over the process.

4. Delegating authority

It’s not good enough to hire a bunch of people -- you must properly delegate work and responsibility to them. As an entrepreneur, the temptation is to try to do everything yourself, but this is not productive and will limit your company’s growth. Strike a balance between monitoring the business and trusting others to accomplish objectives.

How to overcome it: Learn to trust

Give your employees clear roles and responsibilities, as well as rewards for meeting certain benchmarks. Make them stakeholders in your company’s success. Avoid micromanaging people and processes. Give people the space to use their talents and only step in for minor course corrections. Be patient with others -- and with yourself.

5. Managing time

While it may seem like money is constantly in short supply, time is the only thing that will always be limited. Entrepreneurs must make sure their time is spent on the most important tasks, and they must avoid spending time on tasks team members can do. By freeing up this time, they can focus on the bigger-picture issues, such as how to take the company in a direction for growth.

How to overcome it: Be organized and delegate

Identify tasks that can be delegated and then delegate them. Resist the urge to do them yourself because you know you could do it perfectly. Trust your team members -- they will surprise you with how much they can get done and how well they can do it. Focus on your own strengths and let others handle everything else.

6. Guarding cash flow

Cash is always running for entrepreneurs, so you must guard it carefully. It’s a challenge to ensure revenue is consistent and can always cover costs and payroll. The last thing you want to do is start paying employees late because you didn’t plan cash flow properly, which can have ripple effects on the morale of your staff and their trust in your company and leadership.

How to overcome it: Budget and plan

Entrepreneurs need an effective billing system in place and good record-keeping, which is where accounting software can save the day. This software can account for all costs and help entrepreneurs promptly invoice for service and products. Consider working with an accounting professional if you need extra help in this area -- it’s that important.

7. Finding capital

Before they even get to worry about cash flow issues, an entrepreneur needs capital to get off the ground. This is one of the most significant problems faced by entrepreneurs, particularly those striking out on their own who aren’t well-connected to angel investors with deep pockets.

Without enough financial resources to start your business, it will be doomed to fail. You will need capital for space, equipment, or to develop and produce your product.

How to overcome it: Be resourceful and aggressive

Just like you must be a good salesman to get customers to buy your product, you must also market yourself and your company to potential investors. Consult with banks and investors in your area, or look to public platforms like Kickstarter. Consider approaching family, friends, and associates seeking investment or for connections to someone who might be willing to invest.

A word of caution on taking money from friends and family, however: That money will affect your relationship if things go south, so be very careful before taking this route.

8. Projecting confidence

Becoming an entrepreneur seems fun and exciting, and sometimes it is. But most of the time -- particularly early on -- you’re constantly battling self-doubt. Do you have the confidence it takes to be an entrepreneur ? Are you able to shake off feelings of the imposter syndrome?

Unless you are brimming with confidence and have the spirit to fight through adversity -- because you will face significant obstacles you can’t foresee -- you will struggle as an entrepreneur and will likely quit.

How to overcome it: Believe in your skills and vision

One way to deal with imposter syndrome is to remind yourself that, even when you’re failing, that’s never true. You have skills that are valuable, and your persistence and hard work is admirable and something most people aren’t even brave enough to attempt.

Seek support and advice from other entrepreneurs to get you through the tough times. And don’t completely bat away feelings of doubt. Sometimes they open your eyes to problems that you need to fix, so be honest with yourself and willing to learn from setbacks.

Before you jump in, you need a gut check

Are you excited about entrepreneurship? That’s a good attitude to have. But approaching it like a get-rich-quick scheme with no real interest in the venture itself will result in you flaming out almost immediately.

You must take entrepreneurship very seriously. There is a lot of risk, and the failure rate is high. An entrepreneurial mindset is not enough -- one thing that millionaires and billionaires don't often reveal in their books is how much money they started out with, what kind of connections they or their family had, or other advantages that you probably don't have.

Don’t be fooled by those who suggest the only thing stopping you from overnight success is ambition. Most entrepreneurs either throw in the towel after a short time, or they spend years or even decades slowly building their business.

If you want to be one of the latter, first ask yourself whether you have the stamina to work nights and weekends while you keep your day job to support yourself and your family. Is that a lifestyle you could handle? How badly do you want this?

Once you answer that, the path forward becomes a lot clearer.

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DP Taylor is a business software expert writing for The Ascent and The Motley Fool.

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12 Common Challenges Faced by Entrepreneurs in 2024

Starting a successful business from scratch can be challenging. There are many challenges and roadblocks that the average entrepreneur has to face; the most popular is cash flow management.

Entrepreneur statistics show that 20% of small businesses fail within the first year, and 70% of businesses fail within the first ten years.

As an entrepreneur looking to find a foot in a dominated market, you need to brace yourself for the challenges ahead. What separates a successful entrepreneur from an unsuccessful one is the right entrepreneurial mindset that eliminates self-doubt and weaknesses.

Identifying the common challenges is the first step; finding proactive ways of tackling them is where success lies.

This article explores the 12 common challenges of an entrepreneur and practical ways to overcome them.

Let’s get started.

1. Product or Service Selection

One of the biggest issues entrepreneurs struggle with is deciding which product or service to sell to their target market.

Deciding what to sell is important in setting up a business. Your product or service distinguishes you in the market from other competitors. Falling short in this area ultimately leads to the failure of your business, irrespective of your prior knowledge and expertise as a business person.

Choosing the product or service you aim to sell makes it easy for you to identify your target audience and competitors, giving you a competitive advantage.

Every entrepreneur needs to conduct market research for proper product or service selection. You can hire the services of a marketing firm or freelance researcher for this purpose.

Market research is necessary for setting up a business model that allows you to identify your target audience’s needs and the resources available to address them.

For example, market research can identify the lapses in a community regarding access to specific products or services. Your ability to identify and fill this gap and saturate the market with this needed product or service distinguishes you from other entrepreneurs.

2. Raising Capital

Sourcing for capital to start a business is one of the biggest challenges you face as an entrepreneur. Even if you have prior experience of how to run a business, capital is one issue that is likely to give you sleepless nights.

Capital is the working plan of a business, serving as the means to bring your ideas into firm reality. While capital can come in different forms, funds are the biggest determining factor that guarantees whether or not the business will kick start.

Startup statistics show that the biggest reason for startup failure is not receiving enough venture capital funding.

As an entrepreneur, you need to find proactive ways to source funds, as you most likely cannot fund the business yourself. Seeking donations from friends, families, or groups is one of the immediate ways of getting funding for your own business.

You can check out financial institutions that offer business loans for startups with a minimum interest rate. Depending on how big the business is, seeking out loans is the quickest option to get access to a large sum of money.

3. Sales Strategy

Sales is an important criterion for every business, serving as the mechanism by which a business achieves its set target. The number one business objective is to make a profit. As an entrepreneur, sales is one aspect that requires innovative strategies to achieve.

Before you dive into a new market, conducting the necessary research is important as it allows you to ascertain your target market.

Paving the way for yourself as an entrepreneur is a common challenge that you will face, especially in a saturated market. Ultimately, your ability to carve a niche for your business largely depends on how effective your sales strategy is to consumers.

Your sales strategy makes a big difference, helping you establish your business in the face of stern competition.

4. Marketing Strategy

A key deciding factor for every aspiring entrepreneur is how familiar your goods or services are in your target market. Irrespective of how cheap or efficient your goods or services are, there is no gain if it is not getting to your target audience.

Marketing usually comes in different forms, as it introduces your brand and the goods and services offered to the market. Whether through word of mouth or well-structured campaigns, your marketing efforts help you to put your brand out there.

Many entrepreneurs find marketing overwhelming as it requires investment to be able to pull a larger coverage in the market. The bulk of your expenses as an entrepreneur largely go to your marketing efforts.

The biggest issue with marketing efforts is the rewards are not immediate, as you tend to reap the benefits later. To ease your concern, you can start with light marketing strategies and increase the momentum as your business gains ground in the market.

Some of the most effective marketing strategies for fast business growth include content marketing, social media, SEO, influencer marketing, email marketing, and affiliate marketing.

5. Hiring Staff

Hiring skilled workers is one area that proves challenging even for big organizations. As an entrepreneur running a small business, the workload can be overwhelming, and you need capable hands to assist you in running the business.

The challenge is finding these capable hands with the constraints you have on resources. Ensure the aim of hiring employees is not defeated, as quality always beats numbers.

You need to have a concrete recruitment plan reflecting the needs of your business. Your focus should not just be on hiring names but on getting quality hands from the hiring process.

As an entrepreneur, you need to devote an ample amount of time to finding capable hands, which helps ease your workload.

6. Managing Employees

Employees are the human capital aspect of a business, forming the crucial workforce needed to bring a business to achieve its set goals. While the onus is on you to start small as an entrepreneur due to financial constraints, employees are how you expand your business.

Finding capable hands is a challenge entrepreneurs face, as access and availability are known restrictions you need to work your way around.

Even after hiring capable hands, having the right people management skills ensures your employees are properly motivated to deliver on your business goals.

Managing a group of people is a challenging task, as they all come from different backgrounds and have different ways of getting things done. Set rules to guide everyone's conduct, ensuring the interest of the business always comes first above personal interest.

7. Delegating Tasks and Authority

Entrepreneurship puts you as a business owner at the helm of affairs of the day-to-day running of the business activities.

Unless you have an advisory board or management team that provides you with constant advice, most of the tough decisions of the company rest on your shoulders.

One of the common challenges many entrepreneurs face during their entrepreneurship journey is how to delegate tasks . While a company’s success relies on teamwork, the team works effectively when each member of the team functions in their optimum capacity.

As a business owner, you need to properly define your existing processes and highlight areas where you need rapid improvement.

While a business is not guaranteed overnight success, properly delegating tasks and authority in your business serves as the oil that keeps the business engine running.

8. Time Management

Just like money, time is another luxury that will always be limited to you as a business owner. Unlike money, which is not readily available, time is readily available but becomes a luxury when not properly used.

The best way to properly utilize time is by having a concrete plan that delegates tasks to different members of the company. Working as a team is the most efficient shortcut to conquering time, allowing everyone to play a part in the business's success.

Another time management tip is to divide the business goals and objectives into smaller tasks. After this, you then run these tasks on their level of importance to the entire business goal and objective.

Your job as an entrepreneur is to ensure these tasks are carried out based on their level of importance. With these tasks prioritized, you can now manage time better by allocating more time to critical tasks and less on easy-to-complete ones.

9. Managing Cash Flow

Cash flow management is one area that poses a huge challenge to business owners as it questions the entire business process. Your business cash flow simply points out how much money the business has made over time when compared with expenditure and other costs.

The goal of every business is to make a profit and your cash flow highlights how well your business has come to achieving that goal. Having a proper cash flow management strategy helps inform you about how well your business has performed over some time.

Revenue is the key metric tracked in every business and the ultimate goal is to ensure your revenue generated outnumbers your expenses. The difference between your revenue earned and the expenses incurred determines whether your business makes a profit or loss.

Cash flow is the fuel that drives the business's day-to-day running activities and needs to be properly tracked at all times. If you do not have prior accounting knowledge as an entrepreneur, there are accounting software tools that effectively help you track your cash flow.

You can consider hiring an accounting firm to give you a professional look at your business if you have the means to afford it.

10. Expanding the Business

Growth is never an easy step, and even for us as humans, it requires us to undergo modifications that most people find challenging.

As an entrepreneur, having a growth mindset is important, as it positions you and your business to achieve bigger and greater things.

Expansion is always a difficult bridge to cross for new business owners because it requires them to make changes to their existing business processes and structure. The best way to face the issue of expansion is head-on.

Conduct a thorough analysis of the areas that are favorable to you and your business and carry out test surveys. With this, you are better informed and equipped to look beyond your normal scope of operation and attract new customers.

Expanding your business requires a new level of confidence, as you have to adapt to a new market. There would be changes to your prior business structure, goals, and objectives to accommodate these new changes.

Your focus remains to meet your intended goals and objectives, and your expansion process needs to be conducted in a way that guarantees these.

11. Maintaining a Budget

Another area that poses a challenge for entrepreneurs is how to form a budget to serve as a guide for their business operations. Unless you have prior managerial experience, coming up with a budget is a daunting task, especially with the constraints of resources.

A budget is a key aspect of every business operation, serving as a guide on how money and other resources are to be shared and spent.

Keeping track of your revenue and expenses is important as a business owner to ensure you have enough working capital for your business operations.

Drawing up a budget is one aspect of the process, but sticking to the budget is another area that often proves challenging. In the day-to-day running of your business, some areas need immediate attention, and it is always tempting to throw money at problems.

With a solid budgetary plan, you are accountable for all the income you receive, with specific instructions on how to spend it.

For challenges you did not plan for, you should include a miscellaneous expenditure to account for these unforeseen challenges. This way, you take a more structured approach to running your business.

12. Managing Competition

Competition is one of the characteristics that makes us human, as it is our nature to compete with ourselves in a constrained market. Realizing that there would be competitors in your entrepreneurial journey gives you a competitive advantage early on.

There is a huge likelihood that there is already a market for the business idea or setup you intend to venture into. After already conducting your market research and doing your due diligence, you have an idea of who the major players in the industry are.

But with a business, innovation is a major distinguishing factor that makes you stand out. Innovation is one of the biggest solutions to competition, as the market responds to you based on what you can offer.

Realizing your competitors early gives you a major advantage, as you get to form strategies early on how to capture the market. The fight among competitors is for market share. As an entrepreneur, your strategies are what guarantee you a fair fight amidst stiff competition.

Explore Further

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Best Business Quotes to Inspire Entrepreneurs
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Martin luenendonk.

Martin loves entrepreneurship and has helped dozens of entrepreneurs by validating the business idea, finding scalable customer acquisition channels, and building a data-driven organization. During his time working in investment banking, tech startups, and industry-leading companies he gained extensive knowledge in using different software tools to optimize business processes.

This insights and his love for researching SaaS products enables him to provide in-depth, fact-based software reviews to enable software buyers make better decisions.

Professional Development

Top 8 most common entrepreneur challenges, this article covers the common challenges entrepreneurs face when starting their businesses and how to overcome them — from finding the right idea to managing finance..

Being an entrepreneur can be incredibly rewarding. At the same time, there are challenges of starting a business that every entrepreneur faces. No matter how much we plan, unexpected things happen. One of the many entrepreneur challenges is to expect the unexpected and to find a solution to move forward. Keep reading to learn about common problems entrepreneurs face and how to overcome them.

Getting Into Entrepreneurship

If you haven’t already given yourself a pat on the back for starting your own business, go ahead and do that now. This is a big decision, and one you should be proud of. Entrepreneurship comes with flexibility, creative control, and a sense of freedom. It can be a rewarding career path that allows you to embark on work that you truly love and enjoy doing.

On the flip side, part of being a business owner involves understanding some of the issues in entrepreneurship. You’ll undoubtedly encounter various obstacles throughout your journey. Every business owner deals with setbacks and hurdles at some point in their career. Without a boss over you to report to, the weight of responsibilities falls on your shoulders. But don’t worry, we know you can handle it. So, what are challenges that you can expect? We’ve narrowed down some of the most common issues and solutions to prepare you for your entrepreneurial journey.

Starting your own business is an exciting endeavor. To ensure a successful and smooth experience , keep these challenges in mind so you know how to overcome them.

1. Finding the right idea

Before your business can take off, you need to have a viable, profitable business plan. This starts with your idea. Does your business offer something of value? Is there a target market for your business? Many beginners struggle with creating a business that can be sustained years down the line. Focus on the product or service you’ll offer and how it can solve a problem for your target audience.

2. Lack of funding

As a business owner, you take on the financial responsibility needed to successfully run your business. Small business owners often begin as solopreneurs, who handle all the work themselves and don’t have a need to hire employees or outsource their work—at least not yet. If your goals involve hiring a team or expanding offices and locations, you’ll need some way to secure funding in order to grow.

3. Hiring and managing employees

Assuming you have the financial resources to hire and manage a team, the next hurdle comes with finding the right people to work with you. In the age of gig work, it may be easy to find low-cost employees or contractors, but will their work be the kind of quality you’re looking for? One of the problems entrepreneurs face is hiring top-talent employees who still fit within their budget.

4. Time management

Entrepreneurs often wear multiple hats, especially during the beginning stages of their business. From the moment the decision is made to start your business, to your launch, to actually running your business, you’re constantly involved in the process. It can be more time-consuming than expected, and many entrepreneurs run the risk of burnout. Finding a healthy balance between their work and personal lives can be a challenge.

5. Marketing and sales

As with every other aspect of your business, you’re now in charge of promotion and marketing. You need to get the word out about your services or products so customers know what you offer and how to find you. A lot of time and strategy go into developing a successful marketing plan. For people who aren’t experienced in marketing or sales, this aspect of being an entrepreneur can feel daunting and intimidating.

6. Competition

Due to the sheer amount of businesses that exist today, many industries are oversaturated with people trying to establish themselves as experts in their field. Whatever type of business you decide on, it’s important to realize the competition you’ll be faced with. As the industry grows and inevitably changes, so will your competition and your strategy to stand out among the crowd.

7. Adapting to change

Part of the growth challenges as a business owner is the ability to adapt to changes within your industry or field. These changes can come in the form of a shift in market conditions, technological advancements, and customer needs. Entrepreneurs need to be mindful of industry trends and anticipate the change in order to remain competitive.

8. Managing finance

Unless you have a background in finance, many small business owners aren’t familiar with managing finances and cash flow. It’s a challenging aspect of being an entrepreneur, as keeping track of your budget and profitability isn’t an easy task. Without the proper knowledge or guidance on how to manage your finances, you run the risk of doing harm to your business’s finances.

How To Overcome Difficulties: Main Tips

Now that you’re familiar with some of the most common entrepreneur challenges business owners face, here are a few tips to help you navigate through these obstacles.

Research and planning

The best way to prepare yourself is to do your research before launching your business. As excited as you may be to start your business, creating a solid business plan will help guide you throughout your journey. You want to go into this endeavor feeling confident and secure in your marketing strategy.

Identify your priorities, potential pain points, and brainstorm ways to overcome these challenges. It’s a good idea to come up with a Plan B, maybe even a Plan C, just in case you need it. You never know what kind of situations you may encounter with your business. This is where problem-solving can come in handy and help get you through these hurdles.

Seek funding and support

Many entrepreneurs assume they have to foot the bill for their business completely on their own. For many, this might be your only option as you’re starting out. But know that there are other ways to obtain funding and support to help your business grow.

Consider applying for loans or grants to help get your business off the ground. Another option is to connect with your community and host a crowdfunding event or ask for donations. You’ll be surprised how many people are in your corner who want to support you. You can also look into participating in an incubator program, where you often receive funding, mentorship, and networking support during the early stages of your business.

Build a strong team

The best business owners and CEOs are pivotal leaders in their industry . They recognize the value of hiring top-talent employees and invest time and money into their training and development. Cultivating a team that shares your vision for your business is an integral part of being a successful business owner. Take the time to recruit the best possible candidates for your team. These are the people who will represent your company and support you in your success.

Prioritize and delegate

Part of being a good leader in the workplace is the ability to prioritize work and know when to share the responsibility of getting it done. Even though you may feel comfortable doing all the work yourself, your team is there to support you.

As your business continues to grow, you’ll find more tasks and responsibilities to share. In order to maximize your time and work efficiently, allow yourself to delegate work to other people on your team. This can also help you maintain a healthy balance between your work and personal life.

Develop and strong brand and marketing strategy

By now we know that brand voice and a strong marketing strategy are essential elements of building a business. No matter your service or product, consumers want to connect with the brand and the person behind the brand. Create your own unique brand identity that showcases your place in the market that will help you stand out.

Embrace change and innovation

Every industry goes through waves of change, so it’s important to stay up to date with the latest trends and developments in technology. As business owners, it’s our responsibility to evolve with the times. It might be scary, and it may mean investing more time and effort into these changes, but they’ll be worth it so long as you remain relevant to your audience.

Find the Right Platform For You!

Being a business owner can be truly rewarding and lead to many wonderful opportunities in your career. Will it be tough? Yes. Will it require time, some research, and a bit of planning? You bet. Do you have to do it alone? Absolutely not. Practice is your one-stop-shop CRM (customer relationship management) software to run your small business. You can manage your clients, accept payments, and you can even message your clients easily and effortlessly through our platform.

For those entrepreneurs who need a bit more customization, our Pro Plan is for you. Add a custom domain, include your own branding, plus add digital signatures into your workflow. Don’t forget our integration ability to connect Practice to all your other tools for seamless automation. Run your business with Practice for the stress-free client management system you’ve been looking for.

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Simple client management designed for teams, free form templates from practice.

Ready to start meditating? Use our Meditation Client Intake Form Template to help get your clients on the path to better mental health.

Use this Intro Call Intake Form Template to quickly and easily gather information from potential clients for your professional services!

Get the most out of your coaching sessions with this personalized New Performance Coaching Client Questionnaire. Start improving today!

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Writing a Business Plan? 13 Challenges to Overcome

Starting a business? Entrepreneurs know that dreaming up a business idea is the easy part — it’s making your dreams come to fruition that’s the real challenge. And one of the first steps to taking on that challenge is creating a business plan, a task that can be pretty daunting no matter how great your idea is.

Your business plan is essentially your map to success — it’s an outline of the goals, research and projections you have for your new company so that you can stay on the right track, and is an especially important document to have if you’re seeking funding.

Business News Daily asked business owners, strategists and experts what the most difficult part of writing a business plan is. Here are 13 challenges you’ll face writing your business plan.

Actually starting it

“The hardest part about writing a business plan is getting it started. Lock yourself in a room, turn off your phone and focus.”

– John Gavigan, executive director, 43North

Filling out your financials

“The most difficult part of writing a business plan is the financial section. It is difficult to project figures on a brand-new business with, possibly, a brand-new concept. There is not roadmap, no one to follow. The best you can do is find a similar company and try to gauge what they are making.”

– Rosemary O’Brien, owner, Pocket Parks Publishing

Knowing your demographics

“The hardest but most important piece is getting your target demographics dialed in properly. You need to know who you’ll be selling to and how big the market is to estimate with some accuracy how many people you can reach and sell your product or service to.”

– David Batchelor, founder, DialMyCalls.com

Planning for tech changes

“Predicting the unforeseen technology variables that the future holds [is a challenge]. When I started my business nearly 10 years ago, there was no marketing on Facebook, and Twitter and Instagram did not yet exist. Today, these social media platforms play a huge role in my business’ marketing strategy and directly affect sales.”

– Monif Clarke, CEO and founder, Monif C.

Being concise

“[One of the top challenges is] keeping it short and sweet. The more concise and focused a plan is, the more likely business owners are to achieve the goals they have set out for themselves and their business.”

– Rick Faulk, chairman and CEO, Intronis

Making it interesting

“The hardest thing about writing a business plan is being able to tell your story in such a way that people buy into your idea. If you tell a lousy story, people won’t want to invest.”

– MJ Pedone, president and founder, Indra Public Relations

Establishing workable goals

“Establishing clear, concise and understandable goals — these goals must also be realistic. When people can’t see the vision of the plan, they won’t take action to pursue the plan. In addition, by having set goals that align with your plan, you have measureable targets to track your progress.” – Mike Rodriguez, coach and business consultant

Staying grounded

“[You need] to be honest with yourself. Entrepreneurs are by nature dreamers and optimists and business plans require them to challenge their assumptions about market opportunity, the competition, the value of their product and growth projections. That is where they get caught up in defining an aspirational, but somewhat realistic, business plan.” – Vikram Aggarwal, CEO and founder,EnergySage

Being realistic about the outcome

“The biggest issue I see with most business plans is lack of perspective. Excited by their idea, business plan writers start from the point of view that it can’t fail and never fully identify all of the risks associated with their plan.”

– Charlie Johnson, president, Magnolia Financial

Finding the right amount of flexibility

“The hardest thing about writing a business plan is making it flexible enough to allow for change without making it so flexible that it isn’t really a plan. There is a happy medium between these worlds and this is where the most success can be found.”

– Idan Shpizear, owner and founder, 911 Restoration

Proving that your idea is worth it

“Proving monetization is undoubtedly the biggest challenge when it comes to developing business plans. Often, startups will have innovative ideas and a lot of ambition, but not necessarily a budget or the funding to bring their ideas to life. When companies come to us, we always ask [if there is] a need, because need drives business. If there is no need, you won’t be able to succeed with your business plan.”

– Kim Connors, director of strategy, Blue Fountain Media

Being unable to predict everything accurately

“No matter how detailed you make [your business plan], you will always be wrong! Predicting revenues is like looking into a crystal ball. Costs are easier to predict as they are under the company’s control and depend on overall strategy and focus, but even here, some costs may be contingent.”

– Neha Mittal, head of strategy and business development, Arrow Devices

Making your plan useful

“In my experience, the biggest challenges CEOs face is creating a business plan that can actually be successfully implemented. Many companies create plans, but too often, those plans sit on the shelf with actions not done, targets not met.”

– Renee Fellman, management expert, Renee Fellman & Associates

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11.4 The Business Plan

Learning objectives.

By the end of this section, you will be able to:

Describe the different purposes of a business plan
Describe and develop the components of a brief business plan
Describe and develop the components of a full business plan

Unlike the brief or lean formats introduced so far, the business plan is a formal document used for the long-range planning of a company’s operation. It typically includes background information, financial information, and a summary of the business. Investors nearly always request a formal business plan because it is an integral part of their evaluation of whether to invest in a company. Although nothing in business is permanent, a business plan typically has components that are more “set in stone” than a business model canvas , which is more commonly used as a first step in the planning process and throughout the early stages of a nascent business. A business plan is likely to describe the business and industry, market strategies, sales potential, and competitive analysis, as well as the company’s long-term goals and objectives. An in-depth formal business plan would follow at later stages after various iterations to business model canvases. The business plan usually projects financial data over a three-year period and is typically required by banks or other investors to secure funding. The business plan is a roadmap for the company to follow over multiple years.

Some entrepreneurs prefer to use the canvas process instead of the business plan, whereas others use a shorter version of the business plan, submitting it to investors after several iterations. There are also entrepreneurs who use the business plan earlier in the entrepreneurial process, either preceding or concurrently with a canvas. For instance, Chris Guillebeau has a one-page business plan template in his book The $100 Startup . 48 His version is basically an extension of a napkin sketch without the detail of a full business plan. As you progress, you can also consider a brief business plan (about two pages)—if you want to support a rapid business launch—and/or a standard business plan.

As with many aspects of entrepreneurship, there are no clear hard and fast rules to achieving entrepreneurial success. You may encounter different people who want different things (canvas, summary, full business plan), and you also have flexibility in following whatever tool works best for you. Like the canvas, the various versions of the business plan are tools that will aid you in your entrepreneurial endeavor.

Business Plan Overview

Most business plans have several distinct sections ( Figure 11.16 ). The business plan can range from a few pages to twenty-five pages or more, depending on the purpose and the intended audience. For our discussion, we’ll describe a brief business plan and a standard business plan. If you are able to successfully design a business model canvas, then you will have the structure for developing a clear business plan that you can submit for financial consideration.

Both types of business plans aim at providing a picture and roadmap to follow from conception to creation. If you opt for the brief business plan, you will focus primarily on articulating a big-picture overview of your business concept.

The full business plan is aimed at executing the vision concept, dealing with the proverbial devil in the details. Developing a full business plan will assist those of you who need a more detailed and structured roadmap, or those of you with little to no background in business. The business planning process includes the business model, a feasibility analysis, and a full business plan, which we will discuss later in this section. Next, we explore how a business plan can meet several different needs.

Purposes of a Business Plan

A business plan can serve many different purposes—some internal, others external. As we discussed previously, you can use a business plan as an internal early planning device, an extension of a napkin sketch, and as a follow-up to one of the canvas tools. A business plan can be an organizational roadmap , that is, an internal planning tool and working plan that you can apply to your business in order to reach your desired goals over the course of several years. The business plan should be written by the owners of the venture, since it forces a firsthand examination of the business operations and allows them to focus on areas that need improvement.

Refer to the business venture throughout the document. Generally speaking, a business plan should not be written in the first person.

A major external purpose for the business plan is as an investment tool that outlines financial projections, becoming a document designed to attract investors. In many instances, a business plan can complement a formal investor’s pitch. In this context, the business plan is a presentation plan, intended for an outside audience that may or may not be familiar with your industry, your business, and your competitors.

You can also use your business plan as a contingency plan by outlining some “what-if” scenarios and exploring how you might respond if these scenarios unfold. Pretty Young Professional launched in November 2010 as an online resource to guide an emerging generation of female leaders. The site focused on recent female college graduates and current students searching for professional roles and those in their first professional roles. It was founded by four friends who were coworkers at the global consultancy firm McKinsey. But after positions and equity were decided among them, fundamental differences of opinion about the direction of the business emerged between two factions, according to the cofounder and former CEO Kathryn Minshew . “I think, naively, we assumed that if we kicked the can down the road on some of those things, we’d be able to sort them out,” Minshew said. Minshew went on to found a different professional site, The Muse , and took much of the editorial team of Pretty Young Professional with her. 49 Whereas greater planning potentially could have prevented the early demise of Pretty Young Professional, a change in planning led to overnight success for Joshua Esnard and The Cut Buddy team. Esnard invented and patented the plastic hair template that he was selling online out of his Fort Lauderdale garage while working a full-time job at Broward College and running a side business. Esnard had hundreds of boxes of Cut Buddies sitting in his home when he changed his marketing plan to enlist companies specializing in making videos go viral. It worked so well that a promotional video for the product garnered 8 million views in hours. The Cut Buddy sold over 4,000 products in a few hours when Esnard only had hundreds remaining. Demand greatly exceeded his supply, so Esnard had to scramble to increase manufacturing and offered customers two-for-one deals to make up for delays. This led to selling 55,000 units, generating $700,000 in sales in 2017. 50 After appearing on Shark Tank and landing a deal with Daymond John that gave the “shark” a 20-percent equity stake in return for $300,000, The Cut Buddy has added new distribution channels to include retail sales along with online commerce. Changing one aspect of a business plan—the marketing plan—yielded success for The Cut Buddy.

Link to Learning

Watch this video of Cut Buddy’s founder, Joshua Esnard, telling his company’s story to learn more.

If you opt for the brief business plan, you will focus primarily on articulating a big-picture overview of your business concept. This version is used to interest potential investors, employees, and other stakeholders, and will include a financial summary “box,” but it must have a disclaimer, and the founder/entrepreneur may need to have the people who receive it sign a nondisclosure agreement (NDA) . The full business plan is aimed at executing the vision concept, providing supporting details, and would be required by financial institutions and others as they formally become stakeholders in the venture. Both are aimed at providing a picture and roadmap to go from conception to creation.

Types of Business Plans

The brief business plan is similar to an extended executive summary from the full business plan. This concise document provides a broad overview of your entrepreneurial concept, your team members, how and why you will execute on your plans, and why you are the ones to do so. You can think of a brief business plan as a scene setter or—since we began this chapter with a film reference—as a trailer to the full movie. The brief business plan is the commercial equivalent to a trailer for Field of Dreams , whereas the full plan is the full-length movie equivalent.

Brief Business Plan or Executive Summary

As the name implies, the brief business plan or executive summary summarizes key elements of the entire business plan, such as the business concept, financial features, and current business position. The executive summary version of the business plan is your opportunity to broadly articulate the overall concept and vision of the company for yourself, for prospective investors, and for current and future employees.

A typical executive summary is generally no longer than a page, but because the brief business plan is essentially an extended executive summary, the executive summary section is vital. This is the “ask” to an investor. You should begin by clearly stating what you are asking for in the summary.

In the business concept phase, you’ll describe the business, its product, and its markets. Describe the customer segment it serves and why your company will hold a competitive advantage. This section may align roughly with the customer segments and value-proposition segments of a canvas.

Next, highlight the important financial features, including sales, profits, cash flows, and return on investment. Like the financial portion of a feasibility analysis, the financial analysis component of a business plan may typically include items like a twelve-month profit and loss projection, a three- or four-year profit and loss projection, a cash-flow projection, a projected balance sheet, and a breakeven calculation. You can explore a feasibility study and financial projections in more depth in the formal business plan. Here, you want to focus on the big picture of your numbers and what they mean.

The current business position section can furnish relevant information about you and your team members and the company at large. This is your opportunity to tell the story of how you formed the company, to describe its legal status (form of operation), and to list the principal players. In one part of the extended executive summary, you can cover your reasons for starting the business: Here is an opportunity to clearly define the needs you think you can meet and perhaps get into the pains and gains of customers. You also can provide a summary of the overall strategic direction in which you intend to take the company. Describe the company’s mission, vision, goals and objectives, overall business model, and value proposition.

Rice University’s Student Business Plan Competition, one of the largest and overall best-regarded graduate school business-plan competitions (see Telling Your Entrepreneurial Story and Pitching the Idea ), requires an executive summary of up to five pages to apply. 51 , 52 Its suggested sections are shown in Table 11.2 .

Section	Description
Company summary	Brief overview (one to two paragraphs) of the problem, solution, and potential customers
Customer analysis	Description of potential customers and evidence they would purchase product
Market analysis	Size of market, target market, and share of market
Product or service	Current state of product in development and evidence it is feasible
Intellectual property	If applicable, information on patents, licenses, or other IP items
Competitive differentiation	Describe the competition and your competitive advantage
Company founders, management team, and/or advisor	Bios of key people showcasing their expertise and relevant experience
Financials	Projections of revenue, profit, and cash flow for three to five years
Amount of investment	Funding request and how funds will be used

Are You Ready?

Create a brief business plan.

Fill out a canvas of your choosing for a well-known startup: Uber, Netflix, Dropbox, Etsy, Airbnb, Bird/Lime, Warby Parker, or any of the companies featured throughout this chapter or one of your choice. Then create a brief business plan for that business. See if you can find a version of the company’s actual executive summary, business plan, or canvas. Compare and contrast your vision with what the company has articulated.

These companies are well established but is there a component of what you charted that you would advise the company to change to ensure future viability?
Map out a contingency plan for a “what-if” scenario if one key aspect of the company or the environment it operates in were drastically is altered?

Full Business Plan

Even full business plans can vary in length, scale, and scope. Rice University sets a ten-page cap on business plans submitted for the full competition. The IndUS Entrepreneurs , one of the largest global networks of entrepreneurs, also holds business plan competitions for students through its Tie Young Entrepreneurs program. In contrast, business plans submitted for that competition can usually be up to twenty-five pages. These are just two examples. Some components may differ slightly; common elements are typically found in a formal business plan outline. The next section will provide sample components of a full business plan for a fictional business.

Executive Summary

The executive summary should provide an overview of your business with key points and issues. Because the summary is intended to summarize the entire document, it is most helpful to write this section last, even though it comes first in sequence. The writing in this section should be especially concise. Readers should be able to understand your needs and capabilities at first glance. The section should tell the reader what you want and your “ask” should be explicitly stated in the summary.

Describe your business, its product or service, and the intended customers. Explain what will be sold, who it will be sold to, and what competitive advantages the business has. Table 11.3 shows a sample executive summary for the fictional company La Vida Lola.

Executive Summary Component	Content
The Concept	La Vida Lola is a food truck serving the best Latin American and Caribbean cuisine in the Atlanta region, particularly Puerto Rican and Cuban dishes, with a festive flair. La Vida Lola offers freshly prepared dishes from the mobile kitchen of the founding chef and namesake Lola González, a Duluth, Georgia, native who has returned home to launch her first venture after working under some of the world’s top chefs. La Vida Lola will cater to festivals, parks, offices, community and sporting events, and breweries throughout the region.
Market Advantage	Latin food packed with flavor and flair is the main attraction of La Vida Lola. Flavors steeped in Latin American and Caribbean culture can be enjoyed from a menu featuring street foods, sandwiches, and authentic dishes from the González family’s Puerto Rican and Cuban roots. craving ethnic food experiences and are the primary customers, but anyone with a taste for delicious homemade meals in Atlanta can order. Having a native Atlanta-area resident returning to her hometown after working in restaurants around the world to share food with area communities offers a competitive advantage for La Vida Lola in the form of founding chef Lola González.
Marketing	The venture will adopt a concentrated marketing strategy. The company’s promotion mix will comprise a mix of advertising, sales promotion, public relations, and personal selling. Much of the promotion mix will center around dual-language social media.
Venture Team	The two founding members of the management team have almost four decades of combined experience in the restaurant and hospitality industries. Their background includes experience in food and beverage, hospitality and tourism, accounting, finance, and business creation.
Capital Requirements	La Vida Lola is seeking startup capital of $50,000 to establish its food truck in the Atlanta area. An additional $20,000 will be raised through a donations-driven crowdfunding campaign. The venture can be up and running within six months to a year.

Business Description

This section describes the industry, your product, and the business and success factors. It should provide a current outlook as well as future trends and developments. You also should address your company’s mission, vision, goals, and objectives. Summarize your overall strategic direction, your reasons for starting the business, a description of your products and services, your business model, and your company’s value proposition. Consider including the Standard Industrial Classification/North American Industry Classification System (SIC/NAICS) code to specify the industry and insure correct identification. The industry extends beyond where the business is located and operates, and should include national and global dynamics. Table 11.4 shows a sample business description for La Vida Lola.

Business Description	La Vida Lola will operate in the mobile food services industry, which is identified by SIC code 5812 Eating Places and NAICS code 722330 Mobile Food Services, which consist of establishments primarily engaged in preparing and serving meals and snacks for immediate consumption from motorized vehicles or nonmotorized carts. Ethnically inspired to serve a consumer base that craves more spiced Latin foods, La Vida Lola is an Atlanta-area food truck specializing in Latin cuisine, particularly Puerto Rican and Cuban dishes native to the roots of the founding chef and namesake, Lola González. La Vida Lola aims to spread a passion for Latin cuisine within local communities through flavorful food freshly prepared in a region that has embraced international eats. Through its mobile food kitchen, La Vida Lola plans to roll into parks, festivals, office buildings, breweries, and sporting and community events throughout the greater Atlanta metropolitan region. Future growth possibilities lie in expanding the number of food trucks, integrating food delivery on demand, and adding a food stall at an area food market. After working in noted restaurants for a decade, most recently under the famed chef José Andrés, chef Lola González returned to her hometown of Duluth, Georgia, to start her own venture. Although classically trained by top world chefs, it was González’s grandparents’ cooking of authentic Puerto Rican and Cuban dishes in their kitchen that influenced her profoundly. The freshest ingredients from the local market, the island spices, and her attention to detail were the spark that ignited Lola’s passion for cooking. To that end, she brings flavors steeped in Latin American and Caribbean culture to a flavorful menu packed full of street foods, sandwiches, and authentic dishes. Through reasonably priced menu items, La Vida Lola offers food that appeals to a wide range of customers, from millennial foodies to Latin natives and other locals with Latin roots.

Business Description

La Vida Lola will operate in the mobile food services industry, which is identified by SIC code 5812 Eating Places and NAICS code 722330 Mobile Food Services, which consist of establishments primarily engaged in preparing and serving meals and snacks for immediate consumption from motorized vehicles or nonmotorized carts.

Ethnically inspired to serve a consumer base that craves more spiced Latin foods, La Vida Lola is an Atlanta-area food truck specializing in Latin cuisine, particularly Puerto Rican and Cuban dishes native to the roots of the founding chef and namesake, Lola González.

La Vida Lola aims to spread a passion for Latin cuisine within local communities through flavorful food freshly prepared in a region that has embraced international eats. Through its mobile food kitchen, La Vida Lola plans to roll into parks, festivals, office buildings, breweries, and sporting and community events throughout the greater Atlanta metropolitan region. Future growth possibilities lie in expanding the number of food trucks, integrating food delivery on demand, and adding a food stall at an area food market.

After working in noted restaurants for a decade, most recently under the famed chef José Andrés, chef Lola González returned to her hometown of Duluth, Georgia, to start her own venture. Although classically trained by top world chefs, it was González’s grandparents’ cooking of authentic Puerto Rican and Cuban dishes in their kitchen that influenced her profoundly.

The freshest ingredients from the local market, the island spices, and her attention to detail were the spark that ignited Lola’s passion for cooking. To that end, she brings flavors steeped in Latin American and Caribbean culture to a flavorful menu packed full of street foods, sandwiches, and authentic dishes. Through reasonably priced menu items, La Vida Lola offers food that appeals to a wide range of customers, from millennial foodies to Latin natives and other locals with Latin roots.

Industry Analysis and Market Strategies

Here you should define your market in terms of size, structure, growth prospects, trends, and sales potential. You’ll want to include your TAM and forecast the SAM . (Both these terms are discussed in Conducting a Feasibility Analysis .) This is a place to address market segmentation strategies by geography, customer attributes, or product orientation. Describe your positioning relative to your competitors’ in terms of pricing, distribution, promotion plan, and sales potential. Table 11.5 shows an example industry analysis and market strategy for La Vida Lola.

Industry Analysis and Market Strategy	According to ’ first annual report from the San Francisco-based Off The Grid, a company that facilitates food markets nationwide, the US food truck industry alone is projected to grow by nearly 20 percent from $800 million in 2017 to $985 million in 2019. Meanwhile, an report shows the street vendors’ industry with a 4.2 percent annual growth rate to reach $3.2 billion in 2018. Food truck and street food vendors are increasingly investing in specialty, authentic ethnic, and fusion food, according to the report. Although the report projects demand to slow down over the next five years, it notes there are still opportunities for sustained growth in major metropolitan areas. The street vendors industry has been a particular bright spot within the larger food service sector. The industry is in a growth phase of its life cycle. The low overhead cost to set up a new establishment has enabled many individuals, especially specialty chefs looking to start their own businesses, to own a food truck in lieu of opening an entire restaurant. Off the Grid’s annual report indicates the average typical initial investment ranges from $55,000 to $75,000 to open a mobile food truck. The restaurant industry accounts for $800 billion in sales nationwide, according to data from the National Restaurant Association. Georgia restaurants brought in a total of $19.6 billion in 2017, according to figures from the Georgia Restaurant Association. There are approximately 12,000 restaurants in the metro Atlanta region. The Atlanta region accounts for almost 60 percent of the Georgia restaurant industry. The SAM is estimated to be approximately $360 million. The mobile food/street vendor industry can be segmented by types of customers, types of cuisine (American, desserts, Central and South American, Asian, mixed ethnicity, Greek Mediterranean, seafood), geographic location and types (mobile food stands, mobile refreshment stands, mobile snack stands, street vendors of food, mobile food concession stands). Secondary competing industries include chain restaurants, single location full-service restaurants, food service contractors, caterers, fast food restaurants, and coffee and snack shops. The top food truck competitors according to the , the daily newspaper in La Vida Lola’s market, are Bento Bus, Mix’d Up Burgers, Mac the Cheese, The Fry Guy, and The Blaxican. Bento Bus positions itself as a Japanese-inspired food truck using organic ingredients and dispensing in eco-friendly ware. The Blaxican positions itself as serving what it dubs “Mexican soul food,” a fusion mashup of Mexican food with Southern comfort food. After years of operating a food truck, The Blaxican also recently opened its first brick-and-mortar restaurant. The Fry Guy specializes in Belgian-style street fries with a variety of homemade dipping sauces. These three food trucks would be the primary competition to La Vida Lola, since they are in the “ethnic food” space, while the other two offer traditional American food. All five have established brand identities and loyal followers/customers since they are among the industry leaders as established by “best of” lists from area publications like the . Most dishes from competitors are in the $10–$13 price range for entrees. La Vida Lola dishes will range from $6 to $13. One key finding from Off the Grid’s report is that mobile food has “proven to be a powerful vehicle for catalyzing diverse entrepreneurship” as 30 percent of mobile food businesses are immigrant owned, 30 percent are women owned, and 8 percent are LGBTQ owned. In many instances, the owner-operator plays a vital role to the brand identity of the business as is the case with La Vida Lola. Atlanta has also tapped into the nationwide trend of food hall-style dining. These food halls are increasingly popular in urban centers like Atlanta. On one hand, these community-driven areas where food vendors and retailers sell products side by side are secondary competitors to food trucks. But they also offer growth opportunities for future expansion as brands solidify customer support in the region. The most popular food halls in Atlanta are Ponce City Market in Midtown, Krog Street Market along the BeltLine trail in the Inman Park area, and Sweet Auburn Municipal Market downtown Atlanta. In addition to these trends, Atlanta has long been supportive of international cuisine as Buford Highway (nicknamed “BuHi”) has a reputation for being an eclectic food corridor with an abundance of renowned Asian and Hispanic restaurants in particular. The Atlanta region is home to a thriving Hispanic and Latinx population, with nearly half of the region’s foreign-born population hailing from Latin America. There are over half a million Hispanic and Latin residents living in metro Atlanta, with a 150 percent population increase predicted through 2040. The median age of metro Atlanta Latinos is twenty-six. La Vida Lola will offer authentic cuisine that will appeal to this primary customer segment. La Vida Lola must contend with regulations from towns concerning operations of mobile food ventures and health regulations, but the Atlanta region is generally supportive of such operations. There are many parks and festivals that include food truck vendors on a weekly basis.

Industry Analysis and Market Strategy

According to ’ first annual report from the San Francisco-based Off The Grid, a company that facilitates food markets nationwide, the US food truck industry alone is projected to grow by nearly 20 percent from $800 million in 2017 to $985 million in 2019. Meanwhile, an report shows the street vendors’ industry with a 4.2 percent annual growth rate to reach $3.2 billion in 2018. Food truck and street food vendors are increasingly investing in specialty, authentic ethnic, and fusion food, according to the report.

Although the report projects demand to slow down over the next five years, it notes there are still opportunities for sustained growth in major metropolitan areas. The street vendors industry has been a particular bright spot within the larger food service sector.

The industry is in a growth phase of its life cycle. The low overhead cost to set up a new establishment has enabled many individuals, especially specialty chefs looking to start their own businesses, to own a food truck in lieu of opening an entire restaurant. Off the Grid’s annual report indicates the average typical initial investment ranges from $55,000 to $75,000 to open a mobile food truck.

The restaurant industry accounts for $800 billion in sales nationwide, according to data from the National Restaurant Association. Georgia restaurants brought in a total of $19.6 billion in 2017, according to figures from the Georgia Restaurant Association.

There are approximately 12,000 restaurants in the metro Atlanta region. The Atlanta region accounts for almost 60 percent of the Georgia restaurant industry. The SAM is estimated to be approximately $360 million.

The mobile food/street vendor industry can be segmented by types of customers, types of cuisine (American, desserts, Central and South American, Asian, mixed ethnicity, Greek Mediterranean, seafood), geographic location and types (mobile food stands, mobile refreshment stands, mobile snack stands, street vendors of food, mobile food concession stands).

Secondary competing industries include chain restaurants, single location full-service restaurants, food service contractors, caterers, fast food restaurants, and coffee and snack shops.

The top food truck competitors according to the , the daily newspaper in La Vida Lola’s market, are Bento Bus, Mix’d Up Burgers, Mac the Cheese, The Fry Guy, and The Blaxican. Bento Bus positions itself as a Japanese-inspired food truck using organic ingredients and dispensing in eco-friendly ware. The Blaxican positions itself as serving what it dubs “Mexican soul food,” a fusion mashup of Mexican food with Southern comfort food. After years of operating a food truck, The Blaxican also recently opened its first brick-and-mortar restaurant. The Fry Guy specializes in Belgian-style street fries with a variety of homemade dipping sauces. These three food trucks would be the primary competition to La Vida Lola, since they are in the “ethnic food” space, while the other two offer traditional American food. All five have established brand identities and loyal followers/customers since they are among the industry leaders as established by “best of” lists from area publications like the . Most dishes from competitors are in the $10–$13 price range for entrees. La Vida Lola dishes will range from $6 to $13.

One key finding from Off the Grid’s report is that mobile food has “proven to be a powerful vehicle for catalyzing diverse entrepreneurship” as 30 percent of mobile food businesses are immigrant owned, 30 percent are women owned, and 8 percent are LGBTQ owned. In many instances, the owner-operator plays a vital role to the brand identity of the business as is the case with La Vida Lola.

Atlanta has also tapped into the nationwide trend of food hall-style dining. These food halls are increasingly popular in urban centers like Atlanta. On one hand, these community-driven areas where food vendors and retailers sell products side by side are secondary competitors to food trucks. But they also offer growth opportunities for future expansion as brands solidify customer support in the region. The most popular food halls in Atlanta are Ponce City Market in Midtown, Krog Street Market along the BeltLine trail in the Inman Park area, and Sweet Auburn Municipal Market downtown Atlanta. In addition to these trends, Atlanta has long been supportive of international cuisine as Buford Highway (nicknamed “BuHi”) has a reputation for being an eclectic food corridor with an abundance of renowned Asian and Hispanic restaurants in particular.

The Atlanta region is home to a thriving Hispanic and Latinx population, with nearly half of the region’s foreign-born population hailing from Latin America. There are over half a million Hispanic and Latin residents living in metro Atlanta, with a 150 percent population increase predicted through 2040. The median age of metro Atlanta Latinos is twenty-six. La Vida Lola will offer authentic cuisine that will appeal to this primary customer segment.

La Vida Lola must contend with regulations from towns concerning operations of mobile food ventures and health regulations, but the Atlanta region is generally supportive of such operations. There are many parks and festivals that include food truck vendors on a weekly basis.

Competitive Analysis

The competitive analysis is a statement of the business strategy as it relates to the competition. You want to be able to identify who are your major competitors and assess what are their market shares, markets served, strategies employed, and expected response to entry? You likely want to conduct a classic SWOT analysis (Strengths Weaknesses Opportunities Threats) and complete a competitive-strength grid or competitive matrix. Outline your company’s competitive strengths relative to those of the competition in regard to product, distribution, pricing, promotion, and advertising. What are your company’s competitive advantages and their likely impacts on its success? The key is to construct it properly for the relevant features/benefits (by weight, according to customers) and how the startup compares to incumbents. The competitive matrix should show clearly how and why the startup has a clear (if not currently measurable) competitive advantage. Some common features in the example include price, benefits, quality, type of features, locations, and distribution/sales. Sample templates are shown in Figure 11.17 and Figure 11.18 . A competitive analysis helps you create a marketing strategy that will identify assets or skills that your competitors are lacking so you can plan to fill those gaps, giving you a distinct competitive advantage. When creating a competitor analysis, it is important to focus on the key features and elements that matter to customers, rather than focusing too heavily on the entrepreneur’s idea and desires.

Operations and Management Plan

In this section, outline how you will manage your company. Describe its organizational structure. Here you can address the form of ownership and, if warranted, include an organizational chart/structure. Highlight the backgrounds, experiences, qualifications, areas of expertise, and roles of members of the management team. This is also the place to mention any other stakeholders, such as a board of directors or advisory board(s), and their relevant relationship to the founder, experience and value to help make the venture successful, and professional service firms providing management support, such as accounting services and legal counsel.

Table 11.6 shows a sample operations and management plan for La Vida Lola.

Operations and Management Plan Category	Content
Key Management Personnel	The key management personnel consist of Lola González and Cameron Hamilton, who are longtime acquaintances since college. The management team will be responsible for funding the venture as well as securing loans to start the venture. The following is a summary of the key personnel backgrounds. Chef Lola González has worked directly in the food service industry for fifteen years. While food has been a lifelong passion learned in her grandparents’ kitchen, chef González has trained under some of the top chefs in the world, most recently having worked under the James Beard Award-winning chef José Andrés. A native of Duluth, Georgia, chef González also has an undergraduate degree in food and beverage management. Her value to the firm is serving as “the face” and company namesake, preparing the meals, creating cuisine concepts, and running the day-to-day operations of La Vida Lola. Cameron Hamilton has worked in the hospitality industry for over twenty years and is experienced in accounting and finance. He has a master of business administration degree and an undergraduate degree in hospitality and tourism management. He has opened and managed several successful business ventures in the hospitality industry. His value to the firm is in business operations, accounting, and finance.
Advisory Board	During the first year of operation, the company intends to keep a lean operation and does not plan to implement an advisory board. At the end of the first year of operation, the management team will conduct a thorough review and discuss the need for an advisory board.
Supporting Professionals	Stephen Ngo, Certified Professional Accountant (CPA), of Valdosta, Georgia, will provide accounting consulting services. Joanna Johnson, an attorney and friend of chef González, will provide recommendations regarding legal services and business formation.

Operations and Management Plan Category

Content

Key Management Personnel

The key management personnel consist of Lola González and Cameron Hamilton, who are longtime acquaintances since college. The management team will be responsible for funding the venture as well as securing loans to start the venture. The following is a summary of the key personnel backgrounds.

Chef Lola González has worked directly in the food service industry for fifteen years. While food has been a lifelong passion learned in her grandparents’ kitchen, chef González has trained under some of the top chefs in the world, most recently having worked under the James Beard Award-winning chef José Andrés. A native of Duluth, Georgia, chef González also has an undergraduate degree in food and beverage management. Her value to the firm is serving as “the face” and company namesake, preparing the meals, creating cuisine concepts, and running the day-to-day operations of La Vida Lola.

Cameron Hamilton has worked in the hospitality industry for over twenty years and is experienced in accounting and finance. He has a master of business administration degree and an undergraduate degree in hospitality and tourism management. He has opened and managed several successful business ventures in the hospitality industry. His value to the firm is in business operations, accounting, and finance.

Advisory Board

During the first year of operation, the company intends to keep a lean operation and does not plan to implement an advisory board. At the end of the first year of operation, the management team will conduct a thorough review and discuss the need for an advisory board.

Supporting Professionals

Stephen Ngo, Certified Professional Accountant (CPA), of Valdosta, Georgia, will provide accounting consulting services. Joanna Johnson, an attorney and friend of chef González, will provide recommendations regarding legal services and business formation.

Marketing Plan

Here you should outline and describe an effective overall marketing strategy for your venture, providing details regarding pricing, promotion, advertising, distribution, media usage, public relations, and a digital presence. Fully describe your sales management plan and the composition of your sales force, along with a comprehensive and detailed budget for the marketing plan. Table 11.7 shows a sample marketing plan for La Vida Lola.

Marketing Plan Category	Content
Overview	La Vida Lola will adopt a concentrated marketing strategy. The company’s promotion mix will include a mix of advertising, sales promotion, public relations, and personal selling. Given the target millennial foodie audience, the majority of the promotion mix will be centered around social media platforms. Various social media content will be created in both Spanish and English. The company will also launch a crowdfunding campaign on two crowdfunding platforms for the dual purpose of promotion/publicity and fundraising.
Advertising and Sales Promotion	As with any crowdfunding social media marketing plan, the first place to begin is with the owners’ friends and family. Utilizing primarily Facebook/Instagram and Twitter, La Vida Lola will announce the crowdfunding initiative to their personal networks and prevail upon these friends and family to share the information. Meanwhile, La Vida Lola needs to focus on building a community of backers and cultivating the emotional draw of becoming part of the La Vida Lola family. To build a crowdfunding community via social media, La Vida Lola will routinely share its location, daily if possible, on both Facebook, Instagram, and Twitter. Inviting and encouraging people to visit and sample their food can rouse interest in the cause. As the campaign is nearing its goal, it would be beneficial to offer a free food item to backers of a specific level, say $50, on one specific day. Sharing this via social media in the day or two preceding the giveaway and on the day of can encourage more backers to commit. Weekly updates of the campaign and the project as a whole are a must. Facebook and Twitter updates of the project coupled with educational information sharing helps backers feel part of the La Vida Lola community. Finally, at every location where La Vida Lola is serving its food, signage will notify the public of their social media presence and the current crowdfunding campaign. Each meal will be accompanied by an invitation from the server for the patron to visit the crowdfunding site and consider donating. Business cards listing the social media and crowdfunding information will be available in the most visible location, likely the counter. Before moving forward with launching a crowdfunding campaign, La Vida Lola will create its website. The website is a great place to establish and share the La Vida Lola brand, vision, videos, menus, staff, and events. It is also a great source of information for potential backers who are unsure about donating to the crowdfunding campaigns. The website will include these elements: . Address the following questions: Who are you? What are the guiding principles of La Vida Lola? How did the business get started? How long has La Vida Lola been in business? Include pictures of chef González. List of current offerings with prices. Will include promotional events and locations where customers can find the truck for different events. Steps will be taken to increase social media followers prior to launching the crowdfunding campaign. Unless a large social media following is already established, a business should aggressively push social media campaigns a minimum of three months prior to the crowdfunding campaign launch. Increasing social media following prior to the campaign kickoff will also allow potential donors to learn more about La Vida Lola and foster relationship building before attempting to raise funds.
Facebook Content and Advertising	The key piece of content will be the campaign pitch video, reshared as a native Facebook upload. A link to the crowdfunding campaigns can be included in the caption. Sharing the same high-quality video published on the campaign page will entice fans to visit Kickstarter to learn more about the project and rewards available to backers.
Crowdfunding Campaigns	Foodstart was created just for restaurants, breweries, cafés, food trucks, and other food businesses, and allows owners to raise money in small increments. It is similar to Indiegogo in that it offers both flexible and fixed funding models and charges a percentage for successful campaigns, which it claims to be the lowest of any crowdfunding platform. It uses a reward-based system rather than equity, where backers are offered rewards or perks resulting in “low-cost capital and a network of people who now have an incentive to see you succeed.” Foodstart will host La Vida Lola’s crowdfunding campaigns for the following reasons: (1) It caters to their niche market; (2) it has less competition from other projects which means that La Vida Lola will stand out more and not get lost in the shuffle; and (3) it has/is making a name/brand for itself which means that more potential backers are aware of it. La Vida Lola will run a simultaneous crowdfunding campaign on Indiegogo, which has broader mass appeal.
Publicity	Social media can be a valuable marketing tool to draw people to the Foodstarter and Indiegogo crowdfunding pages. It provides a means to engage followers and keep funders/backers updated on current fundraising milestones. The first order of business is to increase La Vida Lola’s social media presence on Facebook, Instagram, and Twitter. Establishing and using a common hashtag such as #FundLola across all platforms will promote familiarity and searchability, especially within Instagram and Twitter. Hashtags are slowly becoming a presence on Facebook. The hashtag will be used in all print collateral. La Vida Lola will need to identify social influencers—others on social media who can assist with recruiting followers and sharing information. Existing followers, family, friends, local food providers, and noncompetitive surrounding establishments should be called upon to assist with sharing La Vida Lola’s brand, mission, and so on. Cross-promotion will further extend La Vida Lola’s social reach and engagement. Influencers can be called upon to cross promote upcoming events and specials. The crowdfunding strategy will utilize a progressive reward-based model and establish a reward schedule such as the following: In addition to the publicity generated through social media channels and the crowdfunding campaign, La Vida Lola will reach out to area online and print publications (both English- and Spanish-language outlets) for feature articles. Articles are usually teased and/or shared via social media. Reaching out to local broadcast stations (radio and television) may provide opportunities as well. La Vida Lola will recruit a social media intern to assist with developing and implementing a social media content plan. Engaging with the audience and responding to all comments and feedback is important for the success of the campaign. Some user personas from segmentation to target in the campaign:

Financial Plan

A financial plan seeks to forecast revenue and expenses; project a financial narrative; and estimate project costs, valuations, and cash flow projections. This section should present an accurate, realistic, and achievable financial plan for your venture (see Entrepreneurial Finance and Accounting for detailed discussions about conducting these projections). Include sales forecasts and income projections, pro forma financial statements ( Building the Entrepreneurial Dream Team , a breakeven analysis, and a capital budget. Identify your possible sources of financing (discussed in Conducting a Feasibility Analysis ). Figure 11.19 shows a template of cash-flow needs for La Vida Lola.

Entrepreneur In Action

Laughing man coffee.

Hugh Jackman ( Figure 11.20 ) may best be known for portraying a comic-book superhero who used his mutant abilities to protect the world from villains. But the Wolverine actor is also working to make the planet a better place for real, not through adamantium claws but through social entrepreneurship.

A love of java jolted Jackman into action in 2009, when he traveled to Ethiopia with a Christian humanitarian group to shoot a documentary about the impact of fair-trade certification on coffee growers there. He decided to launch a business and follow in the footsteps of the late Paul Newman, another famous actor turned philanthropist via food ventures.

Jackman launched Laughing Man Coffee two years later; he sold the line to Keurig in 2015. One Laughing Man Coffee café in New York continues to operate independently, investing its proceeds into charitable programs that support better housing, health, and educational initiatives within fair-trade farming communities. 55 Although the New York location is the only café, the coffee brand is still distributed, with Keurig donating an undisclosed portion of Laughing Man proceeds to those causes (whereas Jackman donates all his profits). The company initially donated its profits to World Vision, the Christian humanitarian group Jackman accompanied in 2009. In 2017, it created the Laughing Man Foundation to be more active with its money management and distribution.

You be the entrepreneur. If you were Jackman, would you have sold the company to Keurig? Why or why not?
Would you have started the Laughing Man Foundation?
What else can Jackman do to aid fair-trade practices for coffee growers?

What Can You Do?

Textbooks for change.

Founded in 2014, Textbooks for Change uses a cross-compensation model, in which one customer segment pays for a product or service, and the profit from that revenue is used to provide the same product or service to another, underserved segment. Textbooks for Change partners with student organizations to collect used college textbooks, some of which are re-sold while others are donated to students in need at underserved universities across the globe. The organization has reused or recycled 250,000 textbooks, providing 220,000 students with access through seven campus partners in East Africa. This B-corp social enterprise tackles a problem and offers a solution that is directly relevant to college students like yourself. Have you observed a problem on your college campus or other campuses that is not being served properly? Could it result in a social enterprise?

Work It Out

Franchisee set out.

A franchisee of East Coast Wings, a chain with dozens of restaurants in the United States, has decided to part ways with the chain. The new store will feature the same basic sports-bar-and-restaurant concept and serve the same basic foods: chicken wings, burgers, sandwiches, and the like. The new restaurant can’t rely on the same distributors and suppliers. A new business plan is needed.

What steps should the new restaurant take to create a new business plan?
Should it attempt to serve the same customers? Why or why not?

This New York Times video, “An Unlikely Business Plan,” describes entrepreneurial resurgence in Detroit, Michigan.

48 Chris Guillebeau. The $100 Startup: Reinvent the Way You Make a Living, Do What You Love, and Create a New Future . New York: Crown Business/Random House, 2012.
49 Jonathan Chan. “What These 4 Startup Case Studies Can Teach You about Failure.” Foundr.com . July 12, 2015. https://foundr.com/4-startup-case-studies-failure/
50 Amy Feldman. “Inventor of the Cut Buddy Paid YouTubers to Spark Sales. He Wasn’t Ready for a Video to Go Viral.” Forbes. February 15, 2017. https://www.forbes.com/sites/forbestreptalks/2017/02/15/inventor-of-the-cut-buddy-paid-youtubers-to-spark-sales-he-wasnt-ready-for-a-video-to-go-viral/#3eb540ce798a
51 Jennifer Post. “National Business Plan Competitions for Entrepreneurs.” Business News Daily . August 30, 2018. https://www.businessnewsdaily.com/6902-business-plan-competitions-entrepreneurs.html
52 “Rice Business Plan Competition, Eligibility Criteria and How to Apply.” Rice Business Plan Competition . March 2020. https://rbpc.rice.edu/sites/g/files/bxs806/f/2020%20RBPC%20Eligibility%20Criteria%20and%20How%20to%20Apply_23Oct19.pdf
53 “Rice Business Plan Competition, Eligibility Criteria and How to Apply.” Rice Business Plan Competition. March 2020. https://rbpc.rice.edu/sites/g/files/bxs806/f/2020%20RBPC%20Eligibility%20Criteria%20and%20How%20to%20Apply_23Oct19.pdf; Based on 2019 RBPC Competition Rules and Format April 4–6, 2019. https://rbpc.rice.edu/sites/g/files/bxs806/f/2019-RBPC-Competition-Rules%20-Format.pdf
54 Foodstart. http://foodstart.com
55 “Hugh Jackman Journey to Starting a Social Enterprise Coffee Company.” Giving Compass. April 8, 2018. https://givingcompass.org/article/hugh-jackman-journey-to-starting-a-social-enterprise-coffee-company/

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The 4 Biggest Challenges of Starting a Business (and How to Overcome Them)

Starting a business isn't for the faint of heart. Identifying and tackling your challenges are crucial for success.

There are many excellent reasons to start a business, including working for yourself, earning more money, having a flexible work schedule and expanding your skill set. However, like all worthwhile endeavors, starting and building a new business is challenging.

If you’re passionate about your business idea, don’t let inevitable entrepreneurial pain points keep you from following through and making your business ownership dream a reality. As most small business owners will tell you, the risks and challenges are usually worth the rewards.

The biggest challenges of starting a business

Consider the following four challenges most entrepreneurs face when starting a business and start thinking about how you’ll overcome them.

1. Running the show alone is a business ownership challenge.

New business owners wear many hats as they get their operations up and running, often handling sales, marketing, accounting, information technology (IT) and more. However, they likely don’t excel in all areas and may end up feeling overwhelmed.

Entrepreneurs often find themselves moving from task to task, putting out fires with one hand while completing everyday tasks with the other. As experienced business owners know, handling everything for too long is bad for your mental and physical health and can take a toll on business productivity .

How to overcome the challenges of running the operation alone

Be honest about your strengths and weaknesses and understand that your time is precious when running a business. While you can certainly embrace professional growth and learn more, sharing the load is key.

Editor’s note: Looking for the right loan for your business? Fill out the below questionnaire to have our vendor partners contact you about your needs.

Here are some tips for handling the myriad tasks required when running a business:

Look for outside help: Seek help in the areas where you struggle. For example, hire a virtual assistant, use a marketing agency or find an IT partner . Hire full-time and part-time employees as you grow to lighten your load.
Utilize Small Business Association (SBA) resources: Explore the SBA’s Office of Small Business Development Centers . This SBA program provides one-stop assistance to current and prospective small business owners, with experts in local offices throughout the United States. sharing information on handling many aspects of running a business.
Get organized: To combat feeling overwhelmed, make your business more organized . Write down and define your daily tasks and goals. Once you’ve identified your tasks, list them in order of priority and cluster-related tasks. Prioritizing helps you determine which tasks and goals to tackle at the most productive time of your day. Organizing and clustering help you handle similar tasks in the same period instead of sporadically.

2. Finding funding is a crucial challenge when starting a business.

Finding investors and funding is one of the biggest startup challenges new business owners face. Not every business needs an immediate, significant cash infusion, but you must ensure you can keep the business running for the long term.

How to overcome funding challenges

When starting a business, you’ll likely apply for small business loans , seek a line of credit, self-fund the business or raise capital.

Here are some best practices for overcoming startup funding challenges:

Utilize SCORE resources: SCORE offers mentors, education and advisors to help small businesses succeed. Speak with a mentor at SCORE to get their thoughts on the best funding course of action for your business based on your goals.
Consider a microloan: Microloans ― typically for less than $50,000 ― are another option for new business owners. Because they’re smaller, microloans are easier to qualify for and provide borrowing opportunities that may not otherwise be available to you. You can use a microloan for a startup project, to get a business off the ground, as working capital or to fund equipment purchases, office leases or new hires. Different microlenders have various rules about using the funds and different qualification requirements (such as a minimum credit score ).
Consider an SBA loan: SBA small business loan programs aim to help entrepreneurs who want to start or expand a business. (The SBA also has a microloan program, so contact your local SBA office to learn more.)
Create an investor pitch: Before presenting your business idea to investors , perfect your pitch. Investors, banks and other lenders will want to understand your vision for success. The better you articulate this vision, the more likely you’ll get the funding you need.

3. Finding and attracting customers is a business startup challenge.

Attracting customers is an area where many new businesses stumble. After all, if no one buys what you’re selling, you can’t succeed. Ideally, you conducted market research before launching your business to ensure your offerings had a receptive market. Now you must identify your target audience , understand their needs and determine what they’re willing to pay.

How to overcome the challenge of attracting customers:

To find and attract customers, you must create a marketing plan that identifies the following:

Your target market
Your product’s strengths and weaknesses compared to the competition
Your marketing position and message
Where you plan to market your product
Your marketing budget

Many new businesses have slim marketing budgets, so low-cost ways to make a big impact are essential. For example, marketers on a budget can consider the following:

Creating social media marketing campaigns
Setting up co-marketing agreements with companies that sell complementary products
Creating email marketing campaigns
Utilizing video marketing to create brand trust
Hosting events or initiatives the media will cover

4. Maintaining a work-life balance is challenging when starting a business.

Any seasoned entrepreneur can tell you about the challenges of maintaining a positive work-life balance . It’s easy to find yourself on the computer from early morning to dinner, only to spend another few hours at night crossing more items off your list. You may suddenly find yourself manic about work and business-related tasks, neglecting responsibilities in other areas of your life. Exercise, time with friends and family and sleep are often taken for granted.

How to overcome work-life balance challenges

As difficult as it might be, establishing a routine that sets clear boundaries between work and free or family time is crucial. Everyone manages their days differently, but if putting “run three miles at lunchtime” on your calendar makes you stick to the commitment, do it.

If you cross everything off your to-do list by 8 p.m., don’t start diving into tomorrow’s tasks. Spend that extra time with family or consider going to bed early. Your body and mind will thank you.

Resources for starting a business

In addition to the SBA and SCORE, many resources can help entrepreneurs set up and run new businesses.

1. Turn to your local chamber of commerce.

Your local chamber of commerce likely has educational materials and videos on starting a business. But even more impactful is meeting, mingling with and getting advice from established business people in your area. They can help you navigate local government requirements, point you in the right direction when you need vendors and give you industry-specific advice.

Your chamber of commerce also likely offers various networking and marketing opportunities, including networking events ― (particularly helpful if you have a business-to-business (B2B) business ― directories, trade shows, job fairs, leadership events and lunch-and-learn events.

2. Create a LinkedIn profile.

Consider creating a LinkedIn business profile . In addition to peer-to-peer communication and networking, LinkedIn helps business owners learn about and participate in free webinars, market their businesses and participate in industry-specific or topic-specific groups. LinkedIn also has a small business resource center with free online courses, written resources on various business topics and virtual events.

3. Find a mentor.

Do you know someone with experience in the type of business you’re starting? Ask them to become your mentor. A mentorship is an informal arrangement where a more experienced person agrees to help and discuss business questions and challenges with you. Mentors can give you great advice, pose questions and issues you may not have considered, help keep you focused and balanced and introduce you to potential customers, partners or funding sources.

4. Check out HR.com.

Although you may start with no employees, you’ll probably need to hire some as you grow your business. HR.com is an excellent HR resource that can help you stay on top of employee and workplace-related regulations , taxes and benefits. It has free HR compliance posters you can download and print, industry trends and research reports and thousands of educational webcasts. After you hire your first HR person , they can take HR certification prep courses at HR.com and earn recertification credits.

4. Access Google’s business resources.

As soon as your business is up and running, create a Google Business Profile so you can control your business’s information across all of Google’s services. Your Google Business Profile will help you appear in local searches, improve your website’s SEO strategy , give your company credibility and allow you to gather reviews.

Google also provides tools for entrepreneurs at a nominal price ($6 per user per month) via Google Workspace, which includes Gmail, Google Drive, Google Meet, Google Calendar, Google Chat, Google Docs, Sheets and Slides to enable seamless communication and collaboration. Google Analytics , which is free, shows you how many people visit your website, how long they stay, where they come from and other information.

If you have a topic you want to learn more about, Google for Small Business provides courses on marketing-related topics like SEO, gathering insights, starting an online store and using email marketing and digital advertising. Most (if not all) of these courses will point you toward Google’s products, but since it’s the 600-pound gorilla of search and digital advertising, it’s valuable information.

Dave Thomas contributed to this article.

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A Detailed Guide to Writing a Business Plan

A business plan is a comprehensive document that explains what a business will do, how and what the goals are. All entrepreneurs should write a business plan before they get started. Why? There are several key reasons.

Why You Need a Business Plan

First and foremost, the process of creating a business plan gives an entrepreneur the opportunity to think through every aspect of their business and make sure that their time, energy and money will be well invested in bringing their idea into fruition.
When you’ve got past this stage and are in the process of launching your business , you will be incredibly busy. Every day you’ll be faced with myriad important decisions and challenges to surmount. Your business plan will provide a valuable road map to support you through that difficult first part of the journey.
You will need to convince others that your idea is a good one . Those people may include potential business partners, skilled employees you’re hoping to work with and critically, investors. Your business plan should prove to them that your company will be successful .

How to Write Your Business Plan

A business plan is not a sales tool or the place for elaborate marketing copy. It needs to convince readers that the business is viable, but through objective facts and logic rather than hyperbole.

When writing your business plan think about the intended audience. Just as you would tailor your CV and cover letter before applying to a particular job, you might want to consider tailoring aspects of your business plan to appeal to readers with different priorities . It is important to know your audience and play to their needs.

A Business Plan Appealing to Investors

When investors review a business plan they won’t just be considering if they should invest, but also when and how they could exit the business. Your business plan should include financial projections that make it clear when the business will become profitable . Similarly, if your ultimate goal includes going public, buying out investors or selling the company, this should be included.

Additionally, investors are typically more interested in market-driven businesses than technology-driven ones. For a greater chance of receiving investment, make sure you include an in-depth analysis of the existing and potential markets for your idea.

A Step b y Step Guide to Writing Your Business Plan

The following steps will take you through the process of putting together your business plan, while helping you to understand if and how your idea could become a profitable business.

1. Executive Summary

The first section of your business plan is the executive summary. Think of this as the hook. It’s your chance to infect the reader with excitement about what you have to offer. The executive summary should include only the most pertinent information from each of the sections that follow . You should explain in brief:

What your business will do and how.
The market for your idea.
What the growth potential is.
What you need to make it happen (if you are applying for funding).

2. Business Overview

This section should include an overview of your business, including a description of your brand, values and mission . You should answer the following questions:

What will your company do?
How will you deliver it?
Why is there a need for your product or service?
What does your brand stand for?
Who are your customers?
How will you reach them?
What have you done so far? For example, have you got a website or any social media channels? Have you started trading?
How will your company be structured?
Do you have any existing partners or shareholders and if so, what is their stake in the business?

3. Market Research

The aim here is to demonstrate that a market exists for your idea. To do this you need to include data on the size of the market, explain relevant trends within the market, and show where your business fits within that landscape . Some key elements to include are:

The size of the overall market for your product or service.
The size of any niches within the market.
Where your business fits.
Whether the market is stable or growing.
Whether it is a new or mature market.
What trends exist and what drives them.

4. Competitor Analysis

Knowing who you are up against is essential to winning any competition. And understanding other companies operating in the same space can help you to refine your approach. What’s more, demonstrating to potential investors that you are familiar with the competition and can clearly differentiate your offering will help them to feel confident that you and your business are a good investment.

This section should include who your biggest competitors are, what they offer and their strengths and weaknesses . Don’t just think about existing players. If your idea is addressing a gap in the market, other entrepreneurs like you may have also recognized the opportunity. Anticipating new competition and explaining how you will respond will prepare you for success when this does eventually happen.

You should also take note of what others are charging for similar products or services. This information will give you an idea of what customers are happy to pay and what the range is. Your pricing strategy should take into account your brand positioning , as well as customer perception of what constitutes value for money, and how much quality costs.

5. Customer Research

What you include in this section will depend on the stage you are at. If you are already trading and have existing customers, how have they responded to your product? Is your audience growing? Alternatively, have you created a prototype and engaged with potential customers to see their reactions? Have you conducted focus groups to explain your idea and discover if there is appetite for it?

Whatever your method, this section needs to demonstrate that you have done the research and proven there is demand for the business you want to create. Understanding your customer will also give you a clear idea of the size of your audience, which will in turn inform your sales forecast .

Interacting with potential customers also offers a vital opportunity for you to refine your offering. Feedback from focus groups and one-on-one conversations could give you the insights needed to make tweaks that will improve your chances of success. Be prepared to discover and respond to new opinions and perspectives. Although it can be hard to hear criticism, no matter how well intended, making changes now will make all the difference when it comes to launching your business.

6. Marketing and Sales Plan

A strong marketing plan is the difference between success and failure. When you first start, it is important to focus on determining the most effective channels and platforms for reaching leads and converting them into customers . Money spent on marketing needs to bring a return on investment. A smart marketing plan includes targeted testing and a continuous feedback loop to refine and improve your efforts. Rather than taking a scattergun approach and spending a little of your valuable time and money on each channel, pick the most important for your business and concentrate on them.

The following elements should be included in an effective marketing plan:

Detailed customer profiles. Determine who your customers are, what their personal goals and needs are, and use these insights to deduce where you can reach them. Starting with a very targeted approach will ensure your efforts are effective. No matter how universal you may believe your product to be, you won’t be able to use the same language and channels to reach a teenager and a pensioner. Be specific about who you are talking to and how.
Which channels will you utilize? It can be tough to know where to start. If you’re not sure, focusing a part of your marketing budget on search engine optimization ( SEO ), pay per click search engine advertising ( PPC ) and email marketing is a good strategy. These channels have proven to be effective time and again for a broad range of businesses and will reach most customer segments.
How will you announce your launch? Are there any opportunities to engage press?
Do you have any personal contacts, an existing database or professional network that may be helpful in publicizing your business?

Your marketing plan should also include a budget and details of how you will measure success.

7. Operations

This section covers all the practical elements that are needed to make your business work . What to include in here depends entirely on the type of business you are establishing. Nonetheless, the following bullet points will help make sure you’ve considered all the operational requirements for your company:

Who are you and why are you starting this business? Before explaining your company structure and describing your team, it is a good idea to describe yourself, your skills and your motivation. Startup investors are often interested in the people behind the idea as much as the idea itself.
Do you have any employees? Will you be employing anyone in the near future? Here you need to account for salaries you will be responsible for, as well as demonstrating you have the skills you need on board to achieve success. However, don’t go overboard. More salaries means greater responsibility and risk. Startup job descriptions are often very broad for this reason.
If you’ve never started a business before, showing you have experts to hand who can support you, whether as board members, mentors or co-founders, will reassure investors and others.
Do you have, or will you need, a physical space? Whether an office or a shop front, you should explain what, why, where and how much it will cost to acquire and maintain. If location is important to your success, for example if you are opening a restaurant, you need to explain why you have chosen the location and include an analysis of similar businesses in the area.
Do you have, or will you need, any suppliers or partners? Include a list and explain how they are connected to the business.
A risk assessment is a vital part of the puzzle. Take this opportunity to think through any challenges that could prevent your business from operating. How would you overcome them and what will you to do mitigate the risk of them happening? For example, if you are sourcing materials from another country, what happens if borders are closed and the product cannot be shipped?
Are there any legal considerations or regulations you need to adhere to? You should also include details of your insurance policy.
Have you acquired, or are you in the process of acquiring, a trademark, copyright or patent? Include the status of your application if relevant.

8. Financials

Your business plan needs to include detailed financial information that shows the current financial state of the company, what it will cost to run your business, what income you expect to make, and when you predict the company will start generating profit .

It is imperative that the financial information you include is thorough and detailed, especially if you are seeking investment. You need to know your numbers and be able to answer questions about them. If you don’t feel you have the expertise to do this well, you should either work with an accountant to produce the documents you need, or seek a partner who has the skills to take care of this side of the business.

The following documents should be included in this section:

Balance sheet. This will show the current financial state of the company. Have you ordered any stock or committed to paying rent, for example?
Income statement. This projects the expected income and expenditure for a specific period.
Cash flow. This shows how cash flows through the business and ensures that key payments, such as salaries, will be able to be paid.
Operating budget. How much will your business cost to run? This will include everything from salaries to utility bills.
Break-even analysis. As the name suggests this will determine how long it will take for your business to become profitable.

When projecting income for the years ahead make sure that you have taken market readiness into account. If you are launching a particularly innovative product or are entering a slow-moving market, the rate of sales may be slower. This should be accounted for in your business plan as it will have a significant impact on the overall financial health of your business.

Where To Begin When Building a Business

There is a lot to consider when launching your own company. However, anyone can do it, it just takes patience, dedication and willingness to learn. There are plenty of helpful templates available on the internet, particularly for some of the financial documents you will need to include, which will help you get started.

If you have an idea and would like to learn from experienced entrepreneurs how to take it to market, explore the business programs we have on offer at EU Business School. Our faculty are working professionals who draw on their own experiences to equip students with the skills, knowledge and mindset needed to succeed. What’s more, our global community of over 27,000 alumni are eager to support students by sharing their skills and expertise.

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The 10 biggest challenges every entrepreneur faces (and how to conquer them).

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To be an entrepreneur means to be someone who takes on challenges. It is absolutely synonymous. It also means you are a problem solver. Knowing what is ahead is half the battle.

The list below is compiled from the challenges that I have recognized from interviewing some of the most successful entrepreneurs on the DealMakers Podcast .

1) Taking the First Leap

The biggest struggle for most would be entrepreneurs is taking that first leap. It may be quitting a job, putting up a website, entering a startup accelerator program, approaching someone with your first pitch, or just announcing your venture to the world and family and committing the dollars and credit you have.

This normally comes after a fair amount of brainstorming and planning. That can be a time when your mind frequently plays tricks on you. Fear and doubt creep. You can make plenty of excuses. There are more than enough to choose from. Including timing of your launch.

From all the super successful entrepreneurs I’ve interviewed two things stand out here. The first is that many of the most successful billion dollar startups were launched and acquired in what most would consider the worst crises and economic times. The timing is always better than you think. Figuring it out as you go is one of the most fun and rewarding parts of being an entrepreneur. Just do it.

2) The Time it Takes for Results to Show Up

Big ‘overnight’ success is really the culmination of steady, consistent small efforts over time. That applies to sales, press, and fundraising. Unfortunately, the vast majority of entrepreneurs fold and quit right before the big pay off hits.

If only they would have held on for another day, week or month, everything would have come together. Often far bigger than they imagined.

In fact, just like Muhammad Ali, the big startup winners are often just those who held out longer, and kept going when everyone else quit and went home. Determine to hang in there. It’s worth it.

3) Cash Flow

Cash flow shortages are one of the most common reasons for new business failures is cash flow management.

During his interview on the DealMakers Podcast, the founder of the hot TRX suspension training brand, Randy Hetrick, warns that you can go broke in your best month ( listen to the full episode here ). In fact, that’s often when it happens. You may have just taken a record number of orders. Yet, you also may have a record amount of expenses to deliver on those promises before you get paid and put the money back in the bank. A hurricane could come through and stall your income for a month. A government shutdown could kick in and freeze all the payments from a big government contract.

Beat this by paying attention to your cash flow needs and projections. Then make sure you have insurance and have some financial reserves. Or at least some emergency credit. Always raise more money than you think you’ll need.

4) Fundraising for Your Startup

There’s a lot more work to startup fundraising than most new entrepreneurs realize. Not having a full understanding of the process and what it takes can lead to a lot of frustration, if not failed rounds, or at least miserable terms.

Raising a round can take from 6 to 12 months. Even the best startups and founders can face 200 no’s for every check they bring in. Then it all starts again.

When it comes to fundraising it is all about mastering storytelling and capturing the essence in 15 to 20 slides. For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel ( see it here ) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash. Moreover, I also provided a commentary on a pitch deck from an Uber competitor that has raised over $400M ( see it here ).

5) Due Diligence

What really becomes challenging in fundraising is the due diligence process after you get funding commitments. The same applies to exits.

Learn as much about this process in advance, and get expert advice on how to manage it well. Not only in terms of execution, strategy and investor updates, but mentally and physically surviving the mayhem and stress as well.

6) Time Management

We all, always want more time. Why can’t there be 48 hours in a day, and 10 days in a week

Unfortunately, we all share exactly the same number of hours in a day. Some will have far fewer days than others.

There will be a lot more to juggle than you imagine if you are hoping to build a true fast growth startup. You’ll be wearing many hats, and probably doing tasks you never imagined. Yet, you can’t allow that to rob you of time for a full life either. There are no do-overs when it comes to relationships.

Set some boundaries in advance. Remember what is truly most important. Harness all the best time and productivity hacks you can.

7) Delegating

Many great entrepreneurs and business owners still really struggle with this. They may preach it. They may be very intelligent and talented. They just can’t get out of their own way. So, they get stuck owning a small business or being a freelance agent, instead of scaling a true startup and industry disrupting company.

The bottom line is that you aren’t going very far unless you learn to hire, outsource, delegate, and more importantly, empower those people to do awesome work. Hire the best. They might not do it 100% like you, but they may actually generate even better results.

8) Balancing Perfection & Progress

The above is a great way to break the chains of getting bogged down in the never ending pursuit of perfection and detailed minutiae.

Do pay attention to the details and polish. It can make a difference. Yet, you aren’t getting anywhere unless you actually take action.

As Seth Godin puts it, you need to recognize the difference between almost barely good enough, and perfect enough.

9) Keeping Ego Under Control

So far this list has focused on challenges in getting to the top. Well, success can bring more. Chief among them is ego. Your ego can lead you to make many mistakes, bad decisions, and generally let your inner beast go on rampage at the cost of your relationships, if you aren’t mindfully keeping it in check.

10) Seeing The Company Fail After an Exit

It’s a lot sexier to talk about raising big rounds of VC money and selling companies for billions of dollars. What few talk about is the challenge and pain in seeing a company once loved not be used, underperform or go bankrupt after an exit.

If you’re lucky you might be able to buy it back at a discount. A better strategy is to find a great home and custodian for it when you decide to sell. That may be far more valuable to you than the price you get.

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2. money management, 4. founder dependence, 5. balancing quality and growth, what is the biggest problem for small businesses, what is the biggest mistake small businesses make, what are the disadvantages facing owners of small businesses, the bottom line.

Small Business

5 Biggest Challenges Facing Your Small Business

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Why Small Businesses Fail

Starting a business is a significant achievement for many entrepreneurs, but maintaining one is the larger challenge. There are many challenges that every business—large or small—faces. Hiring the right people, building a brand, and developing a customer base are some common challenges. However, there are some unique challenges to operating a small business.

Here are the five most significant challenges for small businesses.

Key Takeaways

It's important that a small business is never dependent on a single client.
Small businesses can struggle with money management; hiring a professional to help with money management can free up time to focus on operating concerns.
Overworking is another challenge of operating a small business; it's essential to find the right balance between working long hours and business success.
Many small businesses can become dependent on their founder; a small business owner should not create a situation where the business cannot continue in their absence.
Starting a small business may be different than simply working as a freelancer.

If a single client makes up more than half of your income, you are operating in a way that more closely resembles an independent contractor than a business owner. Diversifying your client base is vital to growing a business, but it can be difficult—especially when the client in question pays well. (Having a client who pays on time for a service is a godsend for many small businesses.)

Unfortunately, client dependence can result in a longer-term handicap; even if you have employees, you may still be technically operating as a subcontractor for another business. This arrangement allows the client to avoid any of the risks of adding payroll to an area of its business operations where work may dry up at any time; as a result, all of that risk is transferred from the larger company to your small business (and your employees). This arrangement is risky, but it can work if your main client has a consistent need for your product or service.

Having enough cash to cover the bills is necessary for any business, but it is also necessary for your personal finances. Between your business and your personal finances, one of these will likely emerge as a capital drain and put pressure on the other. To avoid this problem, small business owners must be heavily capitalized—or secure extra income to shore up cash reserves when needed. Many small businesses start with the founders working a job and building a business simultaneously. While this split focus can make it challenging to grow a business, running out of cash actually makes growing a business impossible.

Money management becomes even more important when cash is flowing into the business. Although handling business accounting and taxes may be within the purview of most business owners, professional help is usually a good idea . The complexity of a company’s books increases with each client and employee; seeking out assistance on bookkeeping tasks can prevent it from becoming a reason not to expand.

The hours, the work, and the constant pressure to perform wear on even the most passionate individuals. Many business owners—even successful ones—get stuck working much longer hours than their employees. Moreover, small business owners may fear their business will stall in their absence and avoid taking any time away from work to recharge.

Fatigue can lead to rash decisions about the business, including the desire to abandon it altogether. Finding a pace that keeps the business humming, without wearing out the owner, is a challenge that can come up early in the evolution of a small business.

It is generally better for a business to have a diversified client base to pick up the slack when any single client quits paying.

A business that can't operate without its founder is a business with a deadline. Many businesses suffer from founder dependence; this is often caused by the founder being unable to let go of certain decisions and responsibilities as the business grows.

In theory, meeting this challenge is easy—a business owner needs to give more control to employees or partners. In practice, however, this is a significant stumbling block for founders because it usually involves compromising (at least initially) the quality of work being done.

Growth should never be the enemy of quality. A small business needs both.

Even when a business is not founder-dependent, there comes a time when the challenges that arise as a result of the business's growth are equal to (or even outweigh) the benefits. Whether it's a service or a product, at some point a business must sacrifice quality to scale up. This may mean not being able to personally manage every client relationship or not inspecting every component of a final product.

Unfortunately, it may be that level of personal engagement and attention to detail that makes a business successful. Therefore, many small business owners find themselves tied to these habits. There is a large middle ground between shoddy work and an unhealthy obsession with quality; it is up to the business owner to navigate its processes toward a compromise that allows growth without hurting the brand.

While small business owners face many challenges in growing and scaling their businesses, it is an excellent time to be a small business owner in the U.S. today. Between March 2021 and March 2022, 1.4 million new small businesses opened in the U.S. When opening a small business, many founders struggle with finding qualified, hardworking employees. Another big problem that small businesses face is a lack of funds. If even one client fails to make a payment, it can have huge consequences for the business. Finally, many businesses struggle with balancing growth and quality. Sometimes it may be necessary to sacrifice quality in order to scale in size.

Starting a small business is undoubtedly challenging, even for the most experienced entrepreneur; the statistics about the high number of businesses that close within a year are a testament to these challenges. However, there are certain mistakes you can avoid in the short term to make success in the long term more likely. One of the most common mistakes that small business owners make is not creating a comprehensive business plan in the beginning. This business plan should include a large amount of research. (Research that should be done before starting the business.) The business plan should include information about how the profit model of the business, market research about the local competition and demand for the product, the operations of the business, an outline of all sales and marketing efforts, investment data, and financial projections.

There are many advantages to being an entrepreneur. First and foremost, working for yourself can offer a level of freedom you cannot find working in a traditional job, with a boss or manager. However, owners of small businesses face many disadvantages that employees do not face. Top of mind for many people considering opening a small business is the high probability of income instability. There is also a significant amount of financial risk that you incur if you finance your small business with a business loan. You may also work longer hours than a traditional employee. Plus, you'll lack the guidance or direction of a traditional employee, who has a boss or manager to provide support. In the beginning stages of starting a business, seek out the help of a mentor or a consultant.

The problems faced by small businesses are considerable, and one of the worst things a would-be owner can do is go into business without considering the challenges ahead . We’ve looked at ways to help make these challenges more accessible, but there is no avoiding them.

On the other hand, a competitive drive is often one of the reasons people start their own business, and every challenge represents another opportunity to compete.

U.S. Chamber of Commerce. " 5 Ways to Achieve Better Work-Life Balance Even Though Your Business Never Stops ."

U.S. Small Business Administration. " 2023 Small Business Profiles for the States, Territories, and Nation ."

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Leading in the next era of corporate sustainability

Fewer things, done better, with greater impact.

Our Growth Action Plan addresses these challenges head-on. In the coming years, our focus will be on four sustainability priorities .

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Our ambition is to deliver net zero emissions across our value chain.

Our ambition is to deliver resilient and regenerative natural and agricultural ecosystems.

Our ambition is an end to plastic pollution through reduction, circulation and collaboration.

Livelihoods

Our ambition is to ensure a decent livelihood for people in our global value chain, including by earning a living wage.

The next era of corporate sustainability

The first era was about ringing the alarm. The second was about setting long-term ambitions. The third is about delivering impact faster , by making sustainability progress integral to business performance.

We intend to lead in this new era by being:

More focused in allocating our resources

using capital allocation to make progress across our sustainability priorities.

More urgent in our actions

with roadmaps, clear accountability and reward.

More systemic in our advocacy

through deeper collaboration and more assertive policy advocacy.

"Our updated commitments are very stretching, but they are also intentionally and, unashamedly, realistic. We are determined that Unilever will deliver against them." Hein Schumacher, CEO Read our CEO Hein Schumacher’s views

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Our updated Climate Transition Action Plan (CTAP) sets out Unilever’s ambitious new climate targets. Discover how we’re focusing our efforts so we can deepen our impact by 2030, and why we believe taking urgent climate action now is good for our business in the long term.

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UN plastics treaty: reasons to be optimistic

With the fourth round of negotiations for a UN treaty to end plastic pollution now concluded, Unilever CEO Hein Schumacher reflects on the progress made and the road ahead.

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How we’re improving livelihoods across our value chain

Head of Social Sustainability, Anouk Heilen, explains how we’re ensuring a living wage for everyone we work with and why better living standards can build a stronger business.

Pablo Costa, Unilever’s Global Head of Packaging in a blue shirt and navy suit

How we’re aiming for greater impact with updated plastic goals

30 April 2024

We recently announced an evolved sustainability agenda to make more tangible progress on the big complex challenges we face. Pablo Costa, Global Head of Packaging, explains what that means for our approach to plastic, and how our updated goals are aimed at making greater impact.

Lucas Urbano, wearing jeans and a checked shirt, stands in front of a field with two green and yellow tractors behind.

How powerful partnerships are helping grow resilient agricultural supply chains

22 April 2024

It’s set to be a year of acceleration for our projects that implement regenerative agriculture practices. Lucas Urbano, our Head of Regenerative Agriculture, Business Operations, explains why partnerships with both farmers and tech experts will be key to scaling up the programme.

Looking for more on sustainability?

Find out about our approach to sustainability and our ongoing commitment to responsible business.

Our commitment to responsible business

Find out more about our progress and reporting on issues such as positive nutrition, business integrity, and safety.

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Human rights

Human rights continue to underpin our sustainability agenda. Find out more about our progress.

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Equity, diversity and inclusion

Find out more about how we are working towards a society where everyone is treated equally.

Unilever Annual Report

Read more about our Growth Action Plan and how we are stepping up our execution to deliver improved performance.

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14 Challenges of Entrepreneurship with Opportunities
Entrepreneurial challenges and how to overcome them
3 Challenges Entrepreneurs Face When Starting a Business
6 Challenges Entrepreneurs Face with Writing Goals
5 Biggest Business Challenges Entrepreneurs Face
4 Major Challenges Faced By Entrepreneurs

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How To Start Business
Avoid These Top 10 Deadly Entrepreneurial Mistakes
How To Write A Business Plan?
How to write a Business Plan?
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3 Big Business challenges to start a business

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5 big challenges when writing a business plan & how to ...
Here are 5 of the biggest challenges people face when writing a business plan, and some suggestions on how to overcome them. 1. Actually starting it. Speaking from experience, this is a tricky one ...
13 Common Challenges When Developing Your First Business
4. Overcoming Your Fear. For most people starting their first business, the biggest challenge seems to be fear. They plan out everything, they see the ideal market, but also lack the experience ...
Nine Common Business Plan Mistakes To Avoid As A New Entrepreneur
5. Forgetting Cash Flow. New entrepreneurs focus a lot on their profitability in their business plan, so they forget to focus on cash flow. Profitability often does not equal cash flow. Many ...
Challenges You Face While Writing a Business Plan: 8 Tips for Success
6. Write the executive summary. 7. assemble and organize the plan. 8 Review and revise the plan as needed. By following these steps, you can be sure that your business plan is comprehensive and well-organized, and that it will effectively communicate your business's goals and objectives.
11 Challenges Entrepreneurs Face and How To Overcome Them
Here are 11 challenges that entrepreneurs might face and how they might approach them: 1. Selecting a service or product. An entrepreneur may have the skills and passion to start a company, but one important factor in starting a business is deciding what to sell. To start, they may identify a demand in their community they could meet.
Developing A Business Plan? 11 Common Mistakes New Entrepreneurs Make
8. Analysis Paralysis. A common mistake I see is analysis paralysis. Although a business plan is important, doing is more important. Too many entrepreneurs get trapped in the preparation. Their ...
How to Write a Business Plan
Add in the company logo and a table of contents that follows the executive summary. 2. Executive summary. Think of the executive summary as the SparkNotes version of your business plan. It should ...
10 Challenges Entrepreneurs Face When Starting a Business and How to
There are so many challenges entrepreneurs face when starting a business. But know this — they can be overcome and you can grow and thrive. Embark on your entrepreneurial journey with confidence. Our guide demystifies the common challenges of starting a business, offering practical solutions for everything from product selection to cash flow management.
What challenges do entrepreneurs face in developing a successful
In this post, I'll cover the top challenges entrepreneurs face in building an effective business strategy and provide tips to tackle them. Mastering business strategy is tough, but understanding these common pitfalls can set you on the right path. Contents hide. 1 Defining the Target Customer. 2 Conducting Market Research.
The Biggest Challenges Entrepreneurs Face When Starting a Business
While starting a business can feel overwhelming at times, preparing for the challenges ahead can increase your chances of success and help you navigate the entrepreneurial gauntlet with confidence and resilience. At Open Eye, we understand the unique challenges entrepreneurs face when starting a business. Oftentimes, startup consulting can help ...
The 5 toughest things entrepreneurs face when starting a business
Lack of support. A lack of support is one of the many challenges you may face when starting your own business. It can be tough when others don't believe in your idea, your ability to succeed, or you as a founder in general. Get a mentor or business adviser to build support when family, friends, and colleagues aren't there for you.
How To Write A Plan That Won't Suck
9. Lean Planning. Lean business planning is a strategic approach to business plan writing created by Tim Berry, the founder of Bplans. It proposes business plans should include the following areas of concern: strategy, tactics, AMMS (Assumptions, Milestones, Metrics, and Schedule), forecasts of sales, and expenses.
How to Overcome Common Challenges Faced by Entrepreneurs
How to overcome it: Be organized and delegate. Identify tasks that can be delegated and then delegate them. Resist the urge to do them yourself because you know you could do it perfectly. Trust ...
12 Common Challenges Faced by Entrepreneurs in 2024
11. Maintaining a Budget. Another area that poses a challenge for entrepreneurs is how to form a budget to serve as a guide for their business operations. Unless you have prior managerial experience, coming up with a budget is a daunting task, especially with the constraints of resources.
Eight Mistakes Entrepreneurs Make When Writing Their First Business Plan
2. Assessing The Marketplace. Entrepreneurs often fail to execute a lean strategy to qualify whether the supply and demand exist — and what pivots need to happen to satisfy the consumer base ...
Top 8 Most Common Entrepreneur Challenges
At the same time, there are challenges of starting a business that every entrepreneur faces. No matter how much we plan, unexpected things happen. One of the many entrepreneur challenges is to expect the unexpected and to find a solution to move forward. Keep reading to learn about common problems entrepreneurs face and how to overcome them.
Writing a Business Plan? 13 Challenges to Overcome
Business News Daily asked business owners, strategists and experts what the most difficult part of writing a business plan is. Here are 13 challenges you'll face writing your business plan. Actually starting it. "The hardest part about writing a business plan is getting it started. Lock yourself in a room, turn off your phone and focus.".
11.4 The Business Plan
There are also entrepreneurs who use the business plan earlier in the entrepreneurial process, either preceding or concurrently with a canvas. For instance, Chris Guillebeau has a one-page business plan template in his book The $100 Startup. 48 His version is basically an extension of a napkin sketch without the detail of a full business plan ...
How to Overcome the Challenges of Starting a Business
Tip. Keep your workspace neat and use the best document management software to store and organize your files. 2. Finding funding is a crucial challenge when starting a business. Finding investors and funding is one of the biggest startup challenges new business owners face.
A Detailed Guide to Writing a Business Plan
A Step by Step Guide to Writing Your Business Plan. The following steps will take you through the process of putting together your business plan, while helping you to understand if and how your idea could become a profitable business. 1. Executive Summary. The first section of your business plan is the executive summary.
The 10 Biggest Challenges Every Entrepreneur Faces (And How To ...
Knowing what is ahead is half the battle. The list below is compiled from the challenges that I have recognized from interviewing some of the most successful entrepreneurs on the DealMakers ...
5 Biggest Challenges Facing Your Small Business
Finding a pace that keeps the business humming, without wearing out the owner, is a challenge that can come up early in the evolution of a small business. It is generally better for a business to ...
(PDF) Challenges Faced by New Entrepreneurs and ...
competition, unforeseen business challenges and others. Besides that, the study's findings have also. revealed several suggestions which can help t o meet those challenges faced by entrepreneurs ...
Leading the next era of corporate sustainability
30 April 2024. We recently announced an evolved sustainability agenda to make more tangible progress on the big complex challenges we face. Pablo Costa, Global Head of Packaging, explains what that means for our approach to plastic, and how our updated goals are aimed at making greater impact. News article.
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What Is a Business Plan?

Why do I need a business plan?

How often should I update my business plan?

What are the three main purposes of a business plan?

What are the key components of a business plan?

What are some tips for writing a successful business plan?

What are some common mistakes to avoid when writing a business plan?

Types of business plans:

Traditional business plans

Lean business plans

How should a business plan look?

How to Write a Solid Business Plan, Step by Step Guide

Challenges you face while writing a detailed business plan

Is it hard to write a business plan?

Do I Need a Simple or Detailed Plan?

How long does it take to write a business plan?

Who can make me a business plan?

The 5 toughest things entrepreneurs face when starting a business

Are business plans useful?

8 Tips for Successful Business plan

FAQs on Writing a Business plan

Do I need a business plan if I'm not seeking funding?

Can I use a business plan template?

How long should my business plan be?

What makes a bad business plan?

How can I make my business plan stand out?

Why do some business plans fail?

What are the biggest challenges in scaling a business?

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How to Write a Business Plan

What do I do with my business plan after I've written it?

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KARTRA TEMPLATES

#1 Choosing What to Sell

#2 Figuring Out a Marketing Strategy and Finding Customers

Here’s the key to creating an airtight marketing strategy and finding customers:

#3 Waiting and Self-doubt

When self-doubt strikes, let’s take a trip down memory lane.

Concentrate on the good stuff, the stuff that drove you to start a business.

#4 Cash Flow, Inconsistent Income, and Late Payments

#5 Time Management When You Wear Many Hats

So, do this:

#6 Delegating and Building Your Team

#7 Balancing Perfection, Progress, and Keeping that Ego in Check

#8 Combating Loneliness

#9 Experiencing Business Growth

#10 Navigating Work-Life Balance

Overcoming Common Challenges as an Entrepreneur: Action Steps

Branding. Branding.Branding.

INSTAGRAM FEELS @DENISEMARIEBORRELLI

What challenges do entrepreneurs face in developing a successful business strategy?

Defining the Target Customer

Conducting Market Research

Crafting a Unique Value Proposition

Managing Cash Flow

Hiring the Right Team

Adapting to Change

Avoiding Scope Creep

Overcoming Founder’s Syndrome

Related Posts

Key Takeaways

Partha Chakraborty

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