Business owners, entrepreneurs, solopreneurs, founders, freelancers, the self-employed – there are many names for the person who chooses to take initiative and earn a living through their own means instead of working for someone else. But the independence of entrepreneurship is a bit of a double-edged sword.
The level of accountability, long hours, and hard work that go into owning a successful business are commonly cited reasons for stress in business owners. Business owners in general deal with higher levels of stress than most of the population.
Small business owners who responded to the Small Business Owner Report survey said the stress of business ownership was twice as high as the stress of maintaining a healthy romantic relationship and nearly three times as stressful as managing their personal finances – the two leading stressors in the general population for non-business owners.
Studies have consistently reported that there are 4 core worries that contribute to most of the stress in business owners. Understanding these worries is essential to more effectively managing your stress levels. These are the 4 core worries that are the leading causes of stress in business owners.
Most Stress in Business Owners Stems From 4 Core Worries
The best part of this finding is that by identifying what your core worries are and understanding how they contribute to your overall stress level, you can take steps to reduce your stress levels and enjoy life more.
Core worry #1: Hiring employees
Hiring employees is the leading cause of stress in business owners. 56% of business owners said hiring employees was their top business challenge. It’s not just because of money – with unemployment rates continuing to fall, businesses increasingly compete for the limited candidate pool available. It’s not easy to find qualified candidates that are in your area, satisfied with your salary offer, and loyal to your company.
To cope with this core worry – Try implementing a different solution. If hiring full-time employees is costly and time-consuming, look into outsourcing the work you need done to a qualified provider. Consider hiring a freelancer or part-time employee to take care of the workload and ease your stress while you figure out a more permanent solution.
Core worry #2: Growing revenue
Growing revenue is the 2nd leading cause of stress in business owners. It’s a core worry because it doesn’t go away – in fact, the longer a company is in business, the more prominent this worry becomes. Almost half of companies with 11-100 employees say growing revenue is their biggest challenge in business.
To cope with this core worry – Do a quick marketing audit. Take a closer look at your marketing channels and the expenses involved with each. Compare the channel you’re investing the most resources (employee time and salaries, budgets, tools, etc.) into the channel that drives the most revenue.
Don’t think a marketing audit will help with stress? Almost 60% of business owners said their website was an ‘integral part of the business,’ even though more than half said their website generated less than 11% of their annual revenue. Don’t make the stress-inducing mistake of investing in the wrong channels.
Core worry #3: Cash flow
Cash flow is another core worry that causes stress in business owners. Every business surveyed said increasing profit or cash flow was one of the top business challenges they face each year. Banks are giving out less loans overall, and that includes small business loans. More competition for smaller pools of qualified candidates, spending resources on ineffective marketing channels and advertising, economic shifts, and a growing need for more advanced technology all contribute to the stress of maintaining or increasing company cash flow.
To cope with this core worry – Make cuts where you can, but don’t obsess over slashing your budgets. That in itself increases stress. As mentioned above, you can opt to outsource or hire freelancers to keep costs down without neglecting important tasks. If you need a lot of capital, connecting with the right lender will ease your stress. Take Maria Contreras-Sweet’s advice (she’s the head of the Small Business Administration): “There’s a lot of capital out there for small businesses. . .consider U.S. Small Business Administration loans, which have less restrictions and requirements.”
Core worry #4: Government regulations
Keeping up with government regulations is the final core worry that affects stress in business owners. The worry applies to both companies positioned in industries where government regulations must be met in order to do business (like the healthcare industry) and companies that are facing regulation in relation to employee healthcare.
Survey data shows that effects from the Affordable Care Act on small businesses really came into play during 2015-2016. Thirty-six percent of owners said specifically that the Employer Shared Responsibility Payment was a cause of stress this year.
To cope with this core worry – Do your research. If you know the rules of the game, it isn’t as stressful to play. Make sure you fully understand any government regulations that apply to your business, and if you aren’t sure you understand, seek assistance from someone who does.