Small business owners reveal biggest challenges during first year

Researchers who polled 1,000 small business owners found taking time off is practically impossible over the first 12 months, according to 64 per cent of those who responded. 

More than a quarter worked for upwards of 12 hours a day in the first year, with four in 10 getting six hours or less sleep a night.

Other struggles include keeping on top of paperwork (23 per cent), having very little money (30 per cent), and raising their business’ profile to attract new clients and customers (28 per cent).

However, the research commissioned by Osome, which provides small businesses with financial management tools and accountants, found 91 per cent are glad they started their company. Although six in 10 admit there are things they would do differently now.

The study also revealed 29 per cent found starting a business to be more expensive than they thought it would be.

For example, in the US every business in almost every state will require a registered agent. A registered agent is the individual or business who is designated to receive important documents on behalf of the business.

This is quite an onerous requirement because the registered agent is required to be available during working hours every business day of the year. It is recommended that businesses use a registered agent service to fulfill this obligation.

Harder than expected

Eight in 10 funded the bulk of their enterprise with their own savings – and on average 76 per cent of the money used to get their company up and running came out of their own pockets.

A third also revealed they found starting their venture harder than they had expected it to be beforehand

For 28 per cent, the first 12 months is likely to have been especially challenging as they somehow held down had a second job over that period.

Small business owners also revealed what they would have done differently with hindsight – with making their social media presence more of a priority (39 per cent) a common reflection.

Getting more support with their marketing (27 per cent), finding a better solution for chasing payments (27 per cent), and making more effort to spend time with family (26 per cent) are also among the things owners would do differently.

More than half (53 per cent) also admitted they wish they’d sought out advice from a third party to help them make their business successful.

And similarly, 44 per cent think they should have utilised the services of a third party to look after their admin and keep their financial affairs in order.

Job satisfaction

But despite all the challenges, the study carried out through OnePoll found 77 per cent would recommend running a business to others.

With being your own boss (70 per cent), having satisfied customers (55 per cent), and making a profit (48 per cent) are top three best things about doing so.

Say Helena Flores, VP of accounting and tax at Osome:

 “Running your own business is very rewarding but it comes with many challenges – and arguably it’s overcoming these hurdles which can make it so satisfying.

“Getting your finances in order are the foundations of a successful business within the first year.

“Managing money coming in and going out, invoices and understanding what’s selling are the three golden rules for success.

“So, if you get through the first year, running a business usually get easier in subsequent years.”

Chris Price