Small Business Problems
“Any phase of business operation that requires attention or decision might be described as problem areas” by Broom and Longenecker.
Small business enterprise also face teething trouble in the initial stages and then after the growth and expansion troubles. Business operations howsoever small it may be, do need attention and appropriate decision so that initial problems may be solved and the business may stand in the field with head-erect and eyes looking forward. And in the later stage it may stand in the comity of complex business world and come out unscathed. The small business problems can be studied in below paragraphs.
Owners Oriented Problems
There are some problems arises due to owners of small business enterprise
It is owned either by single individual or a group of individuals. This indicates that the business suffers with
- Lack of adequate funds
- Lack of time
- Lack of managerial and other skills
- Lack of continuity and flexibility
- Lack of diversified talent
- It suffers with a unique problem of management succession and continued efficiency even if the first owner is good enough in all respects
- It may suffer from effective leadership
Small business enterprises face extra ordinary financial problems both long term and short term. Most they are not viable to procure in adequate quantity and at a time when they are needed most. They owners may face largely the bureaucratic delays and problems in securing capital. Small scale business enterprise largely depends on internal resources (re-investment, on friends, relatives etc.) of the business owners. Other private services which may neither be much reliable nor may come in the desired quantity and on suitable and appropriate terms.
This naturally a major problem for small scale enterprise. They don’t suffer only from financial problems but they usually face stiff competition from big manufacturers for want of an extensive network of distribution. Sometimes government rules and regulations are also not helpful. These enterprises cannot effectively and successfully take the help of market research. They largely depends on their subjective judgment and primitive methods of knowing about the market forces. Thus naturally is not conducive to healthy growth of the organization.
Problem of Personnel
This problem again arises because small scale business enterprises function under financial strains. Securing right type of work force is a task in itself. But when an organization is not able to pay a better remuneration obviously it will be handicapped in all the matters of labour and personnel be it a training or remuneration or good employer-employee relations or any related matter.
Problems of Technology
Modern methods and changing technique have come to stay and it can be easily said that small business units are not well equipped to take advantages of the latest developments either because they are functioning under financial strains or they have not been able to gather requisite information regarding such a development.
Besides above small business problems there are many other problems like policy framers, political managers, big hawks and alike.