Starting a small business delivers entrepreneurs a feeling of excitement that can be only dampened by their next thought — the enormity of fine tuning hundreds of considerations such as online presence, correct licenses, financial statements, and cash flow.
AAT, The Association of Accounting Technicians, recently did a study on the lack of financial as well as legal and marketing knowledge small businesses had while launching their new enterprise. The gathered results pointed to owners wishing they had learned more about different areas of business before first starting their small business.
Struggles of Starting A Small Business
Below are some of the statistics taken from the study disclosing the shortcomings of new business owners:
• 65% struggled with at least one business area
• 20% did not have financial knowledge
• 12% struggled with marketing knowledge
• 11% struggled with legal knowledge
Research When Starting A Small Business
Conversely, the study also revealed how well prepared SME owners were in other areas while starting their business:
• 19% conducted an internet search engine when they needed information and support
• 22% said they would go to an accountant
• 11% looked on a business website
• 10% went to business networks
• 8% went to trade bodies such as the Federation of Small Businesses
• 7% said they would consult family and friends
Summary
AAT concluded that lack of knowledge in certain areas could be attributed to owners not doing research before launching their businesses. Twenty-six percent of SME owners surveyed by AAT said they put their business into motion only after less than a month of researching while only 29% devoted more than six months to researching.
Rob Alder, head of Business Development at AAT, commented on the research found.
“Starting your own business can be a daunting process. This research shows that many people who want to run their own business may need more help when they’re starting out. If you have a business idea, it’s essential you do as much research as possible to ensure your idea has the best chance to succeed. Being confident in yourself and your idea is excellent, but you should still ensure you get as much advice as you can, from multiple sources.”
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