According to government data, India homes around 50,000 start-ups. In 2019, approximately over 1,300 start-ups came into being with more than 3000 start-ups joining the bandwagon in its previous year.
Furthermore, India has improved its rank considerably from 77th in 2019 to 63rd in 2020 in World Bank’s Ease of Doing Business report.
These statistics go on to show that it is no longer challenging to start a business in India. Its robust infrastructure and dynamic economic policies compounded by a slew of government measures and business funding conveniences offered by financial institutions have made it considerably simple to start a business. However, out of the 50,000 start-ups, only 24 are Unicorns – companies with a billion-dollar valuation.
Therefore, while it is simple to start a business, it is not easy to set up a sustainable large-scale enterprise that can reach exceptional heights.
Here are a few challenges that businesspersons face in setting up a large-scale business –
- Sustainable planning
Most start-ups are backed by an ingenious idea that drives its wheels through the initial stages. However, when aiming to set up a large business, a mere idea does not suffice or adequately serve the cause.
Individuals need to commit to a sustainable planning model that goes beyond the initial phases and well into an established stage.
A sustainable planning model is also quintessential to acquiring seed funding, as well as funding for the subsequent stages.
Investors and financial institutions alike require concrete proof of a sustainable income model to ensure secure advancing of investment as advances.
The availability of business loan for woman entrepreneurs is on the same line too.
- Financial planning
Starting a business is not merely about ideas but also about the business funding that will go into priming it into a large-scale setup.
And, that requires proper financial planning. Individuals need to note that typically businesses do not yield profits in the initial stages.
Therefore, to remain afloat for that time, businesspersons need to have a plan to ride out of the initial financial crunch. It involves planning out cash flow, reductions of costs, managing working capital, etc.
For instance, ensuring sufficient funds to pay suppliers in time is a crucial tip for managing working capital for a manufacturing business.
It creates goodwill and grounds for negotiation on discounts. Proper financial planning can ensure that a business does not face hindrances in its operations to be able to establish a large-scale setup.
- Hiring an efficient workforce
Regardless of the scale of a business, it cannot survive or grow successfully in the absence of an efficient workforce.
A primary difficulty in a large-scale setup is the abundance of employees required, which makes it challenging to detect inefficiency or cut fat from the process.
Therefore, individuals might consider basing it on a small-scale model and think along the lines of building the right workforce for a small business.
Basing a large-scale hiring process on the same will facilitate a more productive workforce building due to the focus on job roles and responsibilities, and getting it done with the least possible resources. Thus, it ensures cost reduction, effective utilisation of business funding, and overall efficiency.
Another critical challenge in setting up a large-scale business is marketing to potential clientele or customer bases. Businesses need to devise effective marketing channels to garner the attention of target customers.
Once that is achieved, they need effective measures to sell their service or product while ensuring customer retention at the same time.
For that, business owners and marketing strategists need to extensively research on competitors to identify effective implementations and roadblocks.
However, when setting up a large-scale business, business funding is often tight, and there’s little wiggle room for a marketing budget.
Businesspersons can consider a business loan to avoid encumbrances on their financial standing while adequately injecting funds into marketing.
Nevertheless, apart from these challenges, large-scale setups can also come across challenges like risk management and inexperienced understanding of market conditions.
Therefore, it is crucial to study the market thoroughly in advance, including researching for funding options like a business loan for woman entrepreneurs to minimise hiccups later.