Thinking about starting your own business? This can be incredibly rewarding and there is no reason why you cannot find success with a good business idea and a strong work ethic, but it is also important to be aware of the fact that there are a handful of challenges that are faced by SMEs in 2021 including both general challenges and a few specific to this point in time.
Perhaps the biggest general challenge that SMEs face is cash flow and it is often this that leads startups to fail before they have really had a chance to succeed. This is why it is so important to calculate startup and ongoing costs and to secure enough funding to cover these as well as try to keep costs down in the early stages of the business.
Another general challenge that news businesses face is making people aware of their brand, particularly in competitive industries. Spending enough on digital marketing and beginning this as early as possible is key, but you also need to make sure that you are bringing something new to the table in order to stand out from the crowd. In terms of attracting new customers, you need to have a strong brand identity, develop a positive reputation for your customer service and use deals and promotions to entice people.
Cybercrime has been on the rise for a while now but it has accelerated greatly during the pandemic. Much of the focus is on larger businesses, but SMEs are frequently targeted because they often do not have strong protection in place, which is why it is critical that money is investing in high-quality cybersecurity products and that you prioritise staff training – employee negligence is often the reason that cyber attacks are successful.
Brexit & COVID Uncertainty
Of course, in 2021 you also have the uncertainty surrounding both Brexit and the COVID-19 pandemic and the impact that both of these will have on the economy in the short and long-term. Business owners need to stay current and aware of what the implications of both could be, but there are reasons to be optimistic with many experts stating that they believe it will be SMEs that drive the economic recovery as with the previous financial crisis.
The Importance of Insurance
These are a few of the biggest challenges that face an SME in 2021. The importance of business insurance cannot be overstated as it can provide financial and legal protection against many of the major threats that SMEs face, plus the pandemic has proven that anything can happen and business owners need to prepare for the worst in order to survive and for peace of mind.
While there are many challenges facing new SMEs, especially in 2021, this should not stop you from starting a new business as there are always ways to manage and overcome these challenges.