Starting a small business and growing it into something bigger is a dream for many people. While being your own boss may sound appealing, running a small MSME comes with its own set of challenges.
Of course, it requires a great deal of hard work and sacrifice—not to mention challenges related to funding, planning, and a bit of luck.
Below are some of the key challenges faced by MSMEs that significantly impact business growth, along with one solution to help address them.
Challenges Faced by MSME Owners
1. Limited Funding: A Major Challenge for MSMEs
Every business needs capital to get started and keep running, but securing funding can often be difficult. Limited capital is a major obstacle that many small business owners must overcome.
On top of that, obtaining loans from banks or other lenders can be challenging, especially when the business model and financial track record have yet to be proven.
2. Difficulty in Recruiting Talented Staff
Motivated, hardworking, and loyal staff can be a key factor in a business’s success.
However, attracting such employees can be challenging if you run a small, new business and have to compete with established companies that may offer higher salaries.
3. Struggling to Make Your Business Stand Out in the Market
When it comes to competition, more established businesses can be overwhelming. Their larger scale can make them more attractive to customers.
Therefore, you need to think clearly and carefully about what your MSME offers that sets it apart from others. A unique selling proposition, supported by strong marketing and promotional strategies, will help you overcome this challenge.
4. Transitioning to a New Business Model
As experienced by many business owners, circumstances can sometimes change dramatically, forcing you to adapt your business.
This may require you to offer new products or services, or even operate your business in a new way—such as moving it online or finding new ways to connect with customers.
5. Overreliance on a Small Number of Customers
Loyal and consistent customers are a blessing for any business and should be respected and valued. However, relying too heavily on these regular customers can be risky, as it could become a disaster for your business if they suddenly stop buying.
Relying too heavily on a small number of customers also makes sales highly volatile. While it’s normal for sales to fluctuate, if you only have a few customers, the chances of consistent growth are limited.
Joining a Business Community Could Be the Solution
Even if you feel capable of standing on your own, having support and the opportunity to collaborate within a community can bring many benefits to your business. While it may not provide an immediate solution, a community offers the assistance you need.
Here are some of the benefits you can gain by being involved in a business community.
1. Helps You Learn
Even if you’ve been involved in the MSME business for a long time, you don’t know everything. Especially if you’re a new entrepreneur, there’s still so much to learn.
Being part of a business community is valuable because it gives you the opportunity to learn and gain more knowledge.
The key is to recognize that everyone in the community has their own knowledge and unique experiences that can be incredibly helpful to you.
The knowledge and experience of community members can provide fresh perspectives you need to generate better ideas.
2. Building a Network
Communities are also important for building a network. This is because the people within a community have their own networks and connections, some of which may be the very contacts you’re looking to reach.
For example, connections that help you find qualified staff or introduce you to people who can provide funding support.
Maintain good relationships and stay actively engaged with people in your community, as this will be beneficial not only in the short term but also in the long run.
3. Supporting Yourself and Your Business
Sometimes, all you need is a thumbs-up, encouragement to take a big leap, or even just a shoulder to lean on. You can find this in a supportive community that motivates you to achieve your goals.
Having emotional support and encouragement when making decisions can give you the confidence and strength to make the best choices, leading to better outcomes.
4. Providing New Perspectives
Everyone in a community not only has their own experiences and perspectives but also comes from diverse ethnic and cultural backgrounds, which shape those experiences and viewpoints.
Being part of a community filled with diverse individuals allows you to learn and become accustomed to new ways of thinking and living. This has been shown to offer many benefits, particularly in enhancing critical thinking and empathy.
5. Providing Promotional Support
Marketing today is all about numbers and high metrics. Being part of a large and/or active community is excellent for boosting your social media presence and overall marketing efforts.
For example, if you have a new idea and need online support to bring it to life, you can ask community members to help promote it, boosting engagement and reach.
These are some of the common challenges faced by MSME entrepreneurs, as well as the benefits of joining a business community. If you don’t yet belong to a community, join LabamuHub by Labamu today.
This business community for #GrowTogether is designed to foster connections and collaboration, serving as a one-stop solution to help entrepreneurs from various sectors grow their businesses and go digital.
Some of the programs offered by this community include Networking & Collaboration, which allows you to connect with other entrepreneurs, exchange experiences, and discover collaboration opportunities; and Branding & Promotion, designed to help your business become more recognized and trusted by customers.
If you’re an MSME owner looking to level up and go digital, don’t wait any longer—join LabamuHub by Labamu today!
