What is a Microbusiness?

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Microbusinesses at times known as micro-enterprise is a business with an employee amount that ranges from 1-9 as they are considered an important part of the economy which is why government implements laws to protect them because they greatly contribute to the employment of the citizens.

Microbusiness vs small business.

Think of a microbusiness as a subset of the term “small business.” The definition of a small business varies by industry. In manufacturing, for instance, a small business is 500 employees or fewer, and for retail and service, it’s $6 million or less in average annual revenue.

Most microbusinesses are in the retail sector, construction, health care, and social assistance. 

In addition, a microbreweries can be considered microbusinesses, as they’re defined by producing no fewer than 15,000 barrels of beer each year.

Challenges of a micro-business.

Other than their size, scale, and taxes, micro businesses can be more loosely defined according to the particular challenges they face. Here, we’ll be runing through a few of the common challenges that micro business owners encounter, plus our recommended solutions for these challenges.

Securing finance.

While securing business financing isn’t necessarily easy for businesses of any size, it’s harder for micro businesses to obtain capital loans than even the smallest of definitively “small businesses.” Whether the loan is issued by a traditional bank or an online platform, lenders seek to mitigate risk wherever possible. And as micro businesses operate on such small scales financially, lenders typically view these tiny operations as less stable—and simply less able to handle debt—than larger small businesses are.

Customers and Ad budgets.

Micro businesses operate on smaller scales than small businesses on every level, including the scope of their customer base—and their ability to reach potential customers in the first place. That might put them at a competitive disadvantage to small businesses that have the funds, network, and resources to access fuller-scaled marketing campaigns.

Delivery.

As we mentioned, micro businesses are loosely defined as businesses with fewer than 10 employees, including the owner. More often than not, micro businesses are actually owned and operated by a single person.

While this pared-down staff may be the business owner’s choice, in some cases micro businesses remain “micro” only because they lack the funds to hire more employees and obtain other resources.

Of course, fewer (or zero) staff members means fewer (or zero) people to delegate your work to—which can be overwhelming, to say the least.

Possible solutions to challenges of micro-businesses.

Business Website

Micro business owners—like business owners helming enterprises of any size—should create a business website as soon as they launch.

There are lots of website-building platforms to choose from, but Squarespace and Wix are two of the more popular options for their easy-to-use templates, professional designs, and affordable price points. Importantly, too, these platforms enable you to buy your website domain name.

Both Squarespace and Wix’s templates are also built-in with SEO features, which will help you rank higher on search engines—and which, in turn, makes your business more easily visible to potential customers seeking products or services like yours. 

Networking

As a micro business owner, you’re likely going to find your customers through your personal connections and your local community, so don’t overlook the importance of networking and in-person marketing incentives. 

Outsource Tasks to Digital Tools    

Micro business owners may not have the option of delegating roles to human employees or subcontractors, but there are a wealth of digital tools that can automate and streamline most tricky, time-consuming tasks.

we’d recommend that micro business owners consider the following types of software:

1. Business Accounting Software

Depending on your needs, software from trusted digital accounting platforms like QuickBooks, FreshBooks, and Xero can help you track your sales and expenses, perform bookkeeping tasks, and calculate and file business taxes. Some platforms can automate additional tasks as well, like inventory management, time tracking, invoicing customers, and handling payroll. Alternatively, you might choose to use dedicated payroll software and/or invoice software, depending on your particular needs.     

Project Management Software

If you’re handling several projects or accounts at once (which we hope is the case!), then you might want to look into a project management tool. Platforms like Asana, Trello, and other productivity-boosting tools help you and your team (if you have one) visually organize your tasks and to-do lists to ensure that nothing falls through the cracks.

Author: Austine