If you run your own business, what’s your biggest challenge?
According to a study earlier this year, the answer is likely to be taking time off.
The study, commissioned by Virgin Money to celebrate the launch of their SME savings account, polled 500 entrepreneurs and resulted in a list of the top 30 challenges faced by entrepreneurs.
Four of the top five challenges and six out of the top 10 concerned work/life balance, including long hours and the loss of weekends, holidays and a social life.
Nearly one-fifth of respondents said they worked a minimum of 13-hours every day in their first year of setting up their business, with 7% putting in 16 hours or more every day. Those figures make it unsurprising that so many respondents mentioned missing out on time with family or friends.
The other issues that made it into the top 10 were having less disposable income (3), getting customers (6), dealing with the admin (7) and making a name for yourself and the business (8)
Hugh Chater, chief commercial officer at Virgin Money said: “From start-up, to scaling up and then staying ahead, there’s nothing easy about running your own business.
“Balancing the books, the relentless admin, sorting problems that come out of left field and finding balance in everyday life – are just some of the challenges for many SME owners.”
Worth the risk and worth the work?
Although many of the entrepreneurs said they had taken risks to start their business, including giving up well-paid, safe jobs, the majority also feel that it’s worth it.
“Ultimately, hard work delivers its own satisfaction, enjoyment and reward and 98 per cent of people who run their own business said they wouldn’t have it any other way,” said Hugh Chater.
The risks include funding their businesses themselves, with 54% admitting they used their own resources to start up their business. Redundancy payments and financial help from families often play a part.
The study also found start-ups need an average of £16,309 in order to launch, with an average loss of £9,420 in the first year for those in the red. More than a quarter asked for the expertise from another entrepreneur, with an equal percentage getting insight from the bank or a friend, and three in 10 wished they’d had someone on hand to go to for financial advice when launching their enterprise.
However, over half believed that hard work does pay off, with many seeing profits of nearly £7,000 in their first year, and respondents could list plenty of benefits to offset the challenges of starting your own business.
Over 80% said being your own boss is one of the best things about launching your own company, with 58% per cent stating it is more rewarding, while many said they enjoyed being in control of their career and expanding their network, believing running their own business had been character building.
“What really shines through from our research… is that the freedom and fulfilment of running and growing your own business outweighs any trials and tribulations faced,” says Hugh Chater.
“While it can be difficult setting up your own business, it’s great to see the enjoyment and rewards that can come to those who are successful.”
Top 30 challenges of starting a business:
Taking time off/holidays
Working long hours
Not having as much disposable income
Striking a work-life balance
Dealing with the admin
Making a name for yourself and the business
Never being able to switch off
Spending time with family
Ensuring accounts are up to date
Believing in yourself
Taking work home
Spending time with your partner
Finding time for hobbies/other interests
Managing finances more effectively
Socialising with friends
Being able to deal with problems
Being able to foresee problems
Understanding jargon such as P&L, Net Profit, Gross profit etc.
Writing up a five-year plan
Dating/meeting new people
Family/partner trusting you when you promise the venture would be a success
Being generally more organized
So, what IS your biggest challenge? Do you find yourself working weekends and missing out on holidays and a social life? Tell us what makes it worth it for you.
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We work very closely with our expert accountants to bring you the latest factually correct tax and accounting news. We also enjoy writing about small business news that we hope you find useful!