Establishing your own small or micro business offers many benefits: working your own hours; being your own boss; and getting to choose whether your business is a full time commitment or a side project for additional income.
But despite these advantages, it’s no secret there are obstacles impeding motivated people with great ideas from getting their business established.
I have been working with small and micro businesses in the Hunter region for seven years and I see the same challenges facing my clients over and over again. The most successful ones I see are those who stay up to date with new products and services that can assist them.
Here are five of the most commonly encountered problems.
1. The broad range of skills required
Small business owners have to wear many different hats during the course of their day: CEO, Marketing Manager, CFO, social media guru, HR manager, graphic designer, and IT manager. The complicated nature of running a small business means you need a broad range of fundamental business skills, and the lack of available resources mean there is often just yourself to provide them.
In recognition of this challenge, NAB collaborated with Telstra to launch Proquo – an online platform for small businesses to network, trade or swap services which each other, helping them to build their network with other small businesses.
2. Complexity of credit solutions
It can be hard for small business owners to make informed decisions from the range of funding options available to them. For some, this can lead to cash flow concerns and a high level of stress. Our research shows that 75 per cent of business owners need less than $50,000 to get their business off the ground. Doing a financial health check could help identify potential gaps in your business.
Recognising this major hurdle, NAB recently launched the QuickBiz Loan, providing eligible customers unsecured lending up to $50,000. This type of lending places the emphasis on the strength of your business case, rather than on bricks and mortar security.
3. Heavy administrative load and lack of planning time
When a small business owner has to spend time on non-core business activities, it results in a loss of productivity. Small business owners often describe spending too much time working ‘in’ their business, and not enough time ‘on’ their business strategy and planning for the future. A virtual assistant or digital partner can help to reduce the administrative load.
There are many options out there, such as Xero’s cloud accounting software, to help with your business needs.
4. Staffing issues
Keeping employees satisfied and working well as a team in an intimate and close working environment is a key issue for many small businesses. Training staff is a big investment, and it’s only when employees stay in the business for a length of time that the investment begins to pay off.
Over the years, I’ve observed it’s the business owners who surround themselves with good people who tend to be most successful. Having someone you trust who can serve as a sounding board for new ideas is invaluable, whether they’re part of your business or someone outside it.
5. Complicated tax compliance
There is no denying the tax and compliance on small businesses is complex and time consuming. Outsourcing to experts like accountants and bookkeepers can be costly.
If you’re a sole trader or freelancer then the solution could be at your fingertips, with digital platforms available to ease the burden of tax compliance. Airtax is a partnership with PwC and integrates expense and income data from NAB customers through their NAB transaction accounts, calculates their GST liabilities or credits and lodges the paperwork with the ATO.
The challenges facing small and micro businesses are real, but with good advice and knowledge of the new tools that are available, many of these can be alleviated. If you are thinking of starting a business, remember to speak to an advisor to learn about the full range of solutions available to you. The Micro and Small Business team at NAB Hunter Coast is always happy to help.