Top 5 Challenges Facing Businesses Now
Regardless of size, most businesses face many of the same challenges every day. Maximizing profits, minimizing expenses and finding talented staff to keep things moving seem to be top challenges for both SMBs and large corporations.
Yet as Wasp Barcode’s State of Small Business Report revealed, the prioritization of these items can vary dramatically from one organization to another. Here are the top five challenges facing SMBs today.
1. Growing revenue.
Growing revenue was cited as the top challenge for businesses employing between 11 and 100 workers, while hiring employees was of top importance to businesses with 100 to 499 employees. This could be related to the fact that SMBs still have difficulty in capturing funds from lending institutions. Big businesses, meanwhile, think of challenges in terms of growing their customer bases and dealing with HR issues.
Even in businesses with 101-499 employees, however, growing revenue is close to the top of the list, with 43 percent of respondents stating that growing revenue is the biggest challenge.
2. Hiring employees.
For 56 percent of businesses with 101-499 employees, hiring is the biggest challenge. Finding and competing for the world’s top talent can be tough, especially if the options are confined to a small geographic area. Hiring is also important to businesses with 50-100 employees, sharing equal importance with growing revenue. Small businesses, which often operate on a skeleton crew initially, seem to feel hiring is less of an issue, with only 29 percent of businesses reporting that hiring is a top challenge. Since some of today’s top talent are opting to start their own small businesses rather than working for someone else, larger companies will likely continue to experience this obstacle in the coming years.
3. Increasing profit.
Companies with fewer than 50 employees struggle more than larger organizations to increase profit and sustain a viable cash flow. Cash flow doesn’t seem to be a concern for larger organizations, but SMBs of all sizes struggle to increase profitability on an annual basis. While larger businesses may prioritize it below other concerns, the results of the study make it clear that companies are consistently seeking to increase their profit margins. Perhaps most notable, though, is that the urgency seems to lessen as a company grows. While profitability is always important, it seems to be more of a focus in smaller organizations than larger ones.
4. Government regulations.
Government regulation seems to become a challenge once a company grows to 51-100 employees. Thirty-six percent of organizations with 51-499 employees reported government regulation as a challenge. A 2014 Gallup Poll revealed just how prevalent these challenges are, with business owners consistently required to adjust their behaviors to ensure regulatory compliance. This includes laws related to securing customer data and worrying about the impact of a minimum-wage increase on their operations. As businesses grow, governmental compliance appears to occupy a greater share of their leaders’ time.
5. Employee healthcare.
In recent years, the changes in healthcare legislation have had a direct impact on many businesses. Businesses with 51 employees or more are especially concerned about employee healthcare, listing it as one of the top five challenges. Smaller organizations don’t share that concern, though, perhaps because the mandate requires businesses with 50 employees or more to provide healthcare coverage. As businesses wade through the regulations and strive to ensure they are in compliance, employee healthcare will become an even larger part of a business’s annual concerns.
Each type of business faces its own unique challenges, but knowing that other businesses are going through the same thing can make it easier to cope. Peer networking opportunities can be a great way to discuss these challenges and learn how others are tackling them. Whether your business is grappling with government regulations or seeking to bring in more money, it can help to have support.