Preparing for Obstacles in Your Small Business Journey

Starting and running a small business is a thrilling experience, but it can also be fraught with challenges. You will inevitably stumble on something, if not several things… in a row… publicly (kind of kidding). As you navigate your entrepreneurial journey, it’s crucial to anticipate potential obstacles, such as not budgeting enough, delays, or fluctuating costs. Here’s how to prepare for these common hurdles to ensure your business remains resilient.

Budgeting for Unexpected Costs

One of the most common pitfalls for small businesses is underestimating costs. Whether it’s due to unexpected equipment breakdowns or higher-than-anticipated operational expenses, failing to account for these expenses can create financial strain. A good rule of thumb is to set aside a contingency fund—typically 10% to 20% of your overall budget—to cover unforeseen expenses (Yarbrough, 2020). The initial Eternal Tides budget was what it “needed to be” based on projections and a rigorous exploration of costs, but it was not enough to cover things outside of the plan. Regularly reviewing your financials and adjusting your projections will help you stay on top of potential budget shortfalls.

Delays in Getting Started

Eternal Tides was more than six weeks behind schedule even after pushing-back the schedule of opening to align with the initial deposit on the machine necessary for us to open. Starting a business involves many moving parts, and delays are almost inevitable. Whether it’s waiting for permits (check), equipment (check), or even suppliers (check), time lost can set back your plans and cost you money. A proactive approach is to plan for delays by adding extra time into your timelines. Always have a buffer period built into your schedule, especially when working with contractors or relying on third-party services (Keller, 2021). This will help manage expectations and keep operations running smoothly.

Fluctuating Costs and Market Changes

Small businesses are often vulnerable to fluctuating costs, such as raw materials, shipping fees, or wages. We also inhabit a dynamic world full of unforeseen shifts in what we”know” at any given moment; from the covid-19 pandemic, to politics and global supply chains, we all are on unstable footing now. The costs of necessities can change rapidly, impacting profitability. To mitigate this, it’s essential to diversify your suppliers, establish long-term relationships for better pricing, and regularly monitor market trends. If possible, locking in prices with vendors or suppliers for long-term contracts can also provide stability during volatile times (Garrison, 2019).

Again, this suggests a diligence in research and exploring options. The key to navigating obstacles in your small business is preparation. By budgeting for unexpected expenses, planning for delays, and adapting to market changes, you’ll be better equipped to handle whatever challenges arise and keep your business moving forward.

References

Garrison, R. (2019). How to deal with fluctuating costs in your small business. Forbes. https://www.forbes.com

Keller, M. (2021). Overcoming startup delays: What to expect when starting a business. Entrepreneur. https://www.entrepreneur.com

Yarbrough, K. (2020). Avoiding common small business mistakes: Budgeting for success. Business News Daily. https://www.businessnewsdaily.com