Question

What will be your biggest financial challenge in starting and running your business? How will you meet this challenge?

( for shoes online business)

Answer 1

While starting and running a business,the biggest challenges as an entrepreneur one can face is shortage of capital and shortage of cash flows.

At the initial stages of a business it is very difficult to attract a lot of capital into the business because investors are highly sceptical about the survival of the business and it is always high risk in order to invest into a new business because it has not been exposed to various kinds of market risk, and it cannot survive in the long run if it is not managed properly with entrepreneur, so it is always sceptical on the part of the venture capitalist to invest into such business which is very new and Idea based. So adequate amount of capital at initial stages of business is highly crucial for surviving of the business and an entrepreneur must have the adequate eligibility and proposal in order to lure prospective investor who can fund his project so that he could make it happen.

Another problem which is associated with business is running of business through shortage of cash flows, as cash flows can be the lifeblood of business but lack of cash flows would be Fatal to the company, so in order to survive in the long run there should be enough liquidity for the firm that it can pay off its debts and survive in the long run

one can meet through shortage of cash flows by having adequate cash and adequate proposal as well as adequate investors who can fun the project in the long run.