The Biggest Challenges Small Businesses Face In 2018

There are a great many advantages to small businesses both from a macroeconomic and a more personal perspective. While they may not generate as much money as their larger multinational counterparts they tend to generate economic growth as they hire local, serve their local communities and pay reasonable rates of corporation tax unlike larger enterprises which have elaborate systems of offshore holdings to muddy the waters of their taxation. Moreover, they tend to offer excellent, individually focused customer service and tend to be much more malleable to the needs of individual customers than larger businesses that embrace a ‘one size fits all’ approach. While, on the face of it, small business appears to be on the rise this does not mean  that the realm of entrepreneurship is not without its challenges.  Here are some of the biggest challenges that nascent SMEs face in 2018

Winning the trust of a fickle online market

Whether they use ecommerce as an integral part of their trading or not, most small businesses understand the importance of a digital presence in the ultra competitive 21st century market. From freelancers writers to fried chicken take outs, every business today seems to need its own website, social media presence and even their own app to gain a market share.

Although some entrepreneurs have the skills and expertise to do this themselves, a great many need to outsource a lot of their online activities from their social media management to the generation of regular online content to boost their Search Engine Optimization to using a virtual office to giving the appearance of a larger enterprise without the expensive overheads. Managing all of this on top of the day-to-day operation of their business represents a considerable strain.  

The political climate

The relationship between politics and commerce has always been turbulent but recent political events including Trump’s extremely nationalistic “America First” policy and the ticking time bomb of Brexit have cast a pall of uncertainty over business for whom international trade is their bread and butter. Even great economists are unsure of how the divorce of the UK from the EU will affect international trade and with negotiations between Great Britain and the European Union becoming increasingly tense and unfriendly, we still have no way of knowing what will happen, although a recently leaked impact assessment paints a grim picture and suggests that there may not be a ‘best case scenario’.

Pricing

Many nascent businesses encounter struggles with pricing. It is, after all, one of the many natural teething problems of running a business. Selling your own products that don’t have the benefit of an RRP, calculating reasonable profit margins that allow for the possibility of discounts and promotions and paying one’s self a salary worthy of one’s skills, experience and expertise are all common pricing dilemmas with which new entrepreneurs regularly grapple.

In the gig economy, however, established customers face a new pricing quandary. As services like People Per Hour offer extremely low priced services from places like Eastern Europe and Asia many businesses find themselves constantly undercut by freelancers whose prices they simply cannot afford to compete with.