10 causes of stress for small business owners, and how to cope
Here are the top 10 causes of stress for small business owners, and how to deal with them. Our business rescue advice for World Mental Health Day.
10 October 2021 is World Mental Health Day
World Mental Health Day 2021 is run by the World federation for Mental Health and takes place on 10 October every year. It’s a vital opportunity to publicly address the high levels of stress that millions of us experience in our daily lives, which has been piled on over the last 20 months whilst the world went through the COVID pandemic with the UK having three full lockdowns which drastically affected businesses finances.
Stress is perhaps one of the greatest public health challenges of our time. While being a significant factor in mental health problems, it just isn’t taken as seriously as physical health. It’s important that business owners take the time to understand what is causing them personal stress, which can affect their business decision making processes. To work out the steps we can take to reduce it.
The Stress of Small Business Ownership
Stress is a huge problem for small business owners. A third say they are too busy to even think about supporting mental health in the workplace. And almost half believe that they should be doing more.
There is no escaping the fact that running a small business is one of the most stressful things you can possibly do. You can, however, take steps to address the issues causing the stress.
Here we take a look at the 10 most common stress triggers for small business owners, based on the “Small Business, Big Stress” report by Xero. With a few suggestions on how you can take steps to reduce the pressure.
#1. Managing staff (42 per cent)
No matter what your business, employees are usually the most important asset you have.
It is no surprise then that 42 per cent of SME owners feel staff management is their biggest cause of stress. Getting the right team, going in the right direction, while remaining happy and productive is no mean feat.
Remember: Business owners are in charge of leadership, but it is the quality of the team that powers a business. And giving your team the chance to improve will improve your business.
Nurture employees. Offer training and support, ditch micromanagement, and have an open door policy. As Richard Branson said: “If you take care of your employees, they will take care of your business”.
A happy employee means better productivity, less staff turnover, more specialist knowledge, a collective responsibility for the business success and a strong business brand in the world.
#2 Admin. Admin. Admin. (35 per cent)
We all know bureaucracy and red tape can stifle company growth. 35% of entrepreneurs say admin is a “major obstacle” for their business.
The Federation for Small Businesses (FSB) and Starling Bank estimated that the average micro-business and SME owner spends between 60 to 70 hours per month on such tasks as tax returns, reliefs, employment contracts, pensions, auto-enrolment or health and safety assessments.
Single-handedly managing a company might seem like honest hard work but it can be damaging to your personal and business health.
If possible, delegate. Find a part time assistant or a VA who will take over admin tasks.
Consider outsourcing specialist tasks, such as accounts for financial planning and business advice.
#3. Feeling responsible for the company success, or failure (31 per cent)
A third of SME owners find key decision making very stressful. Knowing that expensive mistakes could impact the company’s future success. It is a huge burden to bear.
Try creating a culture where you, and your teams, celebrate small everyday successes. Acknowledge “near wins” and make business planning priority. Be micro ambitious and set up short-term growth goals.
We regularly meet distressed directors who unnecessarily feel ashamed for letting everyone down. When actually, facing up to a business’s failings may be the best way of turning things around. Speaking to an independent specialist will not only provide you with expert knowledge but also will help to manage your fears.
#4. Keeping up with compliance (26 per cent)
Complying with regulatory changes can be costly for businesses, no matter the size. It’s not surprising that 26% of SME owners reported finding it stressful.
Compliance often requires businesses to rethink their processes and workflows. Like the GDPR in 2018 or recent introduction of Making Tax Digital regulation.
Our advice is not to fear the change. Instead, treat it as an opportunity to test the company’s agility.
The regulatory environment is always evolving. So get prepared and embrace the change.
#5. Overheads and expenses (24 per cent)
Poor cash flow and booking has always been one of the top reasons companies close down. So keeping on top of small business expenses is vital, but stressful.
Get to know your way around your small business accounts. This may not come naturally to everyone, but learning the accounting basics will mean that you are more likely to make good business decisions in the future.
#6. Clients, and keeping them happy (23 per cent)
Customers are the lifeblood of your company. Unfortunately they usually know this. Keeping them happy, so they come back, while still making a profit may feel like a high-wire a balancing act.
Be clear on what your business is offering them, and when you will deliver. So, they know what to expect and will be happy with the result.
Never over promise. The extra stress as you try to deliver, and the likelihood of an unhappy client if you don’t, is simply not worth the stress. To you or your business.
Communication is key. Let them know you want to make their experience better, and listen to their feedback. They will appreciate your business more.
#7. Imposter syndrome (20 per cent)
Small business owners can feel like impostors. Hardly surprising when a business owner needs to wear so many hats.
Having to deal with an array of issues on a daily basis, and life throwing those crafty business curve balls, it may feel like you are not really qualified for the job.
The truth is that we all have experienced an impostor syndrome at some point.
Research suggest that the best way to overcome is to accept your inadequacies, accept that it is a part of the learning process.
Own your successes, don’t rely too much on external validation. Be true to yourself and transparent to your clients. Laugh and embrace your failures. But most of all, ask for help when you need it!
#8. Filing taxes (19 per cent)
There is no escaping taxes. Or the stress of filing your small business tax returns.
It’s a complicated process that can be simplified using the right software. Ditch those intricate, but time consuming spreadsheets. And make sure you get an accounts software package that complies with the latest digital returns requirements. We promise you won’t look back.
Better yet, if you haven’t got one already, get an accountant! A good accountant will save you money. As well as a great deal of time and stress.
#9. Time pressure (17 per cent)
Running your own business is time consuming. With so many things that ‘must’ be done it may feel there is never enough time in the day.
These time pressures force many small business owners into working extremely long hours. This puts enormous stress on your health and mental well being.
Simplify your processes can make your workload more manageable.
Make time for yourself. Learning how to self-care and how to manage our minds can make a huge difference. It’s proven to help you become more productive!
#10. Multitasking (14 per cent)
Small business owners often find themselves multitasking. Squeezed between ever increasing workloads and time demands, it seems to be the only answer.
Multitasking has somehow become synonymous with being ‘productive’. In modern work culture even it’s almost expected that this is a new “skill” to master.
In reality multitasking is counterproductive. It actually reduces your performance, increases stress, anxiety, and can even cause depression.
Small Business Ownership: Coping with Stress
One of the easiest, but most overlooked stress solutions for small business owners is asking for help.
As the business owner you automatically feel everything stops with you. But there are limits.
During these uncertain times we understand the impact of financial difficulty can be devasting both on your business and your quality of life.
If you are feeling stressed, ask for help. Don’t try and tackle everything yourself.
And if your business is struggling, get help sooner rather than later. For the sake of your health, and that of your business.
To help you understand the insolvency decision-making process, we have prepared an Insolvency Options flowchart exploring the three insolvency routes in an easy to use, jargon-free way.
It is not always clear which options are the right ones for your business. The first step is to call us. We offer a free initial confidential business rescue consultation.
You don’t know what we can do until you ask.
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